Daschel withdraws HHS nomination

Former Senator Tom Daschle Tuesday withdrew his nomination to be Health and Human Services Secretary after admitting his failure to pay taxes.

It's an embarrassment to President Obama, who's trying to focus on the economy and his stimulus plan in the senate.

The number was just too big.

The former Senate Majority Leader admitted not paying $128,000 in taxes due from use of a friend's car and driver.

He withdrew his nomination Tuesday as HHS secretary, saying the controversy would be a distraction.

A blow to President Obama, who also lost an senior economic aide Tuesday over tax problems.

"They both decided and recognized that their nominations would distract from the important goals and the critical agenda that the president put forward," said Whitehouse spokesman Robert Gibbs.

All this as the senate debated the Obama economic recovery plan

Democrats want more spending for road repairs, 25 billion more and 12 billion more for water and mass transit projects.

"Investing in construction projects is tried and true way to put people back to work," said democratic Senator Patty Murray of Washington State.

But the president on Tuesday nominated a republican, senator Judd Gregg, as his Commerce Secretary and Mr. Obama is warning fellow democrats to do more to win over republicans to the stimulus plan, meaning less spending.

"With the stakes this high we cannot afford to get trapped in same old partisan gridlock," said the President.

One republican proposal aims at spurring home sales, that rebounded a bit last month.
"Let's start lowering interest rates on mortgages," said republican senator Bob Bennett of Utah.

Banks could make 30 year home loans at 4% guaranteed by the government plan.