Thomas A. Daschle, President Obama's choice to be secretary of health and human services, withdrew his nomination today, citing the distractions that followed his failure to pay $146,000 in taxes in recent years.

His decision came shortly after another prominent Obama nominee, Nancy Killefer, withdrew her nomination to be chief performance officer because of similar -- although smaller -- tax lapses.

In a round of interviews this afternoon with major television networks, Obama accepted responsibility for the Daschle debacle, saying he regretted the implication that there is one set of rules for prominent people and another for ordinary taxpayers.

"I think this was a mistake," he said on CNN. "I think I screwed up."

Daschle, a former Senate majority leader, had come under pressure since Friday, when it was reported that he did not pay some taxes over the past three years, primarily for the use of a car and driver given to him by an associate. He met yesterday with members of the Senate Finance Committee to explain the omission and apologized. But some Republicans had questioned whether the nomination should go forward, and his confirmation vote had been postponed until at least the middle of next week.

Obama said yesterday that he supported Daschle's nomination "absolutely."

But after days of mounting questions about the apparent ethical loopholes in the new administration, the president said today that he had accepted Daschle's decision to withdraw.

"This morning, Tom Daschle asked me to withdraw his nomination," Obama said in a statement. "I accept his decision with sadness and regret." Obama said Daschle had "devoted his life to public service and health care reform, so that every American has access to health care they can afford."

His statement added: "Tom made a mistake, which he has openly acknowledged. He has not excused it, nor do I. But that mistake, and this decision, cannot diminish the many contributions Tom has made to this country, from his years in the military to his decades of public service."

Daschle, in a statement, said being chosen for the post had been "one of the signal honors of an improbable career."

"But if 30 years of exposure to the challenges inherent in our system has taught me anything, it has taught me that this work will require a leader who can operate with the full faith of Congress and the American people, and without distraction," Daschle said. "Right now, I am not that leader."

Daschle had been appointed to two posts -- both the HHS secretary and the health-care czar, with an office at the White House. He will not serve in either job, officials said.

"I will not be the architect of America's health-care reform, but I remain one of its most fervent supporters," Daschle said.

At his daily press briefing, White House press secretary Robert Gibbs was peppered with questions about the twin withdrawals, and he indicated that they were part of an effort by Obama to restore a sense of trust in the transparency he had promised as a candidate.

"You can't set a standard of responsibility but accept a different standard of who serves," Gibbs said.

Asked whether there were other nominees in trouble, Gibbs indicated there are not. "The president is quite confident in the people he has chosen to serve in government," Gibbs said, "that we've put a standard of ethics and accountability unseen and unmatched by any previously seen."

Gibbs said that Daschle had made the decision to remove his name from consideration.

"Let me step back and do a little bit broader answer," Gibbs said. "We're at a critical juncture in our nation's history, and a crossroads economically, and the president has a robust agenda to deal with many of those problems. As Senator Daschle said in the statement that we released . . . he did not want to be a distraction to that agenda."

Gibbs struggled to explain why Daschle and Killefer withdrew their nominations but Treasury Secretary Timothy F. Geithner did not. Geithner had failed to pay tens of thousands of dollars in taxes as well but was eventually confirmed by the Senate.

Asked whether anyone at the White House had taken responsibility for the inadequate vetting process, Gibbs said: "We all take responsibility; the president takes responsibility."

Key lawmakers were barely given notice of Daschle's decision. Sen. Max Baucus (D-Mont.), chairman of the Finance Committee, who gave his support to Daschle after the 75-minute committee meeting yesterday, said he was told 15 minutes before the news broke.

"The tone was almost collegial, it was not acrimonious," Baucus said of the meeting, during which senators reviewed the report on Daschle's finances and then met with him personally behind closed doors.

"Based on that meeting, I'm a little surprised by Senator Daschle's decision," Baucus said.

Sen. Richard J. Durbin (Ill.), the Senate Democratic whip, said Daschle "did the honorable thing." He said Daschle probably "would have prevailed in the end, but it would have taken a while."

Durbin said the withdrawal could be a serious setback for health-care reform, because of Daschle's unusually strong legislative background and long interest in the issue. "It sets us back," Durbin said.

"He didn't really have a choice," said Sen. John Cornyn (R-Tex.), after calling earlier in the day for Daschle to step aside.

Daschle also faced criticism in a New York Times editorial today, which called for him to withdraw his nomination because of his tax problems and his ties to the health-care industry.

In the earlier withdrawal, Killefer indicated that controversy over failure to pay taxes by Daschle and Geithner had persuaded her to decline the new president's request to join his administration. Killefer had a tax lien placed on her house by the D.C. government in 2005 because she had not paid unemployment taxes for her household help. She resolved the problem five months after the lien was filed, but the Associated Press wrote about it shortly after Killefer was nominated in early January.

"I recognize that your agenda and the duties facing your Chief Performance Officer are urgent," Killefer wrote in a letter to Obama, which was released by the White House this morning. "I have also come to realize in the current environment that my personal tax issue of D.C. Unemployment tax could be used to create exactly the kind of distraction and delay those duties must avoid. Because of this I must reluctantly ask you to withdraw my name from consideration."

Obama nominated Killefer to be deputy director for management at the Office of Management and Budget and to take on a new White House post, chief performance officer for the entire federal government. Both positions require Senate confirmation. Obama had said Killefer would work on "identifying where there are areas that we can make big change that lasts beyond the economic recovery plan and save taxpayer money over the long term."

It was not immediately clear who would replace her.

Killefer's confirmation would have been handled by the Senate Committee on Homeland Security and Governmental Affairs, which is chaired by Sen. Joseph I. Lieberman (I-Conn.) and has jurisdiction over OMB appointments. The White House never officially referred her nomination to the panel and a committee staff background investigation had only recent started, according to committee spokeswoman Leslie Phillips.

"Sen. Lieberman is disappointed the nomination process for this important position has been delayed," Phillips said in a written statement. "He hopes the Obama Administration quickly appoints a new nominee so the critical business of making government more efficient and responsive to the American people can be carried out with energy and vigor."

Killefer is a senior director at McKinsey & Co., an international management consulting firm with private- and public-sector clients. From 1997 to 2000, she served as assistant secretary for management and chief financial officer and chief operating officer at the Treasury Department.

At McKinsey -- where she worked before joining Treasury, and after her stint there -- she has consulted with the retail, hotel and pharmaceutical industries on management, marketing and efficiency issues. Killefer also chaired the IRS Oversight Board from 2001 to 2005 and has served on the board of the Partnership for Public Service since 2006. She has drawn wide praise from colleagues.

"She's a very talented person, and we have a lot of important issues that she was going to be charged with addressing," Max Stier, president and chief executive of the Partnership for Public Service, said this morning. "My hope is that the Obama administration works with great dispatch and works to find someone with her caliber, who will give as much prioritization to the matter as the president was giving these issues."

When Obama named Killefer to the post in early January, Stier said she was a top pick because she had excelled both in the private and governmental sectors.

"What Nancy brings is a wealth of experience of working in the government on management issues," Stier said then. "That combination of expertise from the public and private sectors will be what she needs to draw on to do a very challenging job."

During the presidential campaign, Obama proposed the creation of a "SWAT team" composed of "top-performing and highly trained government professionals" that would work with government agency leaders and the Office of Management and Budget to eliminate government waste and improve efficiency.

"The CPO will work with federal agencies to set tough performance targets and hold managers responsible for progress," according to the campaign proposal. "The president will meet regularly with cabinet officers to review the progress their agencies are making toward meeting performance improvement targets."

The District government alleged that after Killefer left Treasury, she failed to pay unemployment compensation tax for a household employee. After 18 months, a lien for $946.69 was placed on her home in the Wesley Heights neighborhood of Northwest Washington -- including $298 in unpaid taxes, $48.69 in interest and $600 in penalties.

The lien was filed March 7, 2005, and resolved July 29.

At the time, her son and daughter were teenagers, according to the Associated Press. But, the wire service said, she told Harvard business students at the time that she had two nannies and a personal assistant to run her life when she was on the road.

Staff writers Paul Kane and Ceci Connolly contributed to this article.

www.washingtonpost.com/wp-dyn/content/story/2009/02/03/ST2009020301282.html