Examiner | April 1, 2010
By Kathy Shaidle

On March 25, yet another Obama administration nominee was forced to withdraw under a cloud. Jon Cannon had been President Barack Obama’s choice as second in command at the Environmental Protection Agency (EPA), until allegations of financial “irregularities” surfaced at the now-defunct America’s Clean Water Foundation, where Cannon once served on the board.

Two days later, Scott Polakoff was forced to take an open-ended “leave of absence” from the Treasury Department, after internal audits uncovered his allowance of backdated capital infusions, “which,” as one news report put it, “could amount to cooking the books for IndyMac and other institutions” that are key players in the current financial system meltdown.

Polakoff had been appointed second in command at the Office of Thrift Supervision (OTS) by George W. Bush – the position he held during the time period now under investigation by the Inspector General. He had then been appointed acting director of the OTS in February by President Obama, after John Reich’s retirement.

As reported by CNN, when Federal Reserve Chairman Ben Bernanke told the Senate Budget Committee on March 3 that American International Group (AIG) “exploited a huge gap in the regulatory system” and that “there was no oversight of the Financial Products division,” (...) he “was not quite accurate.”

"Just two days later a man hardly anybody has ever heard of explained to yet another Senate committee that — hold the presses — there WAS a regulator for the Financial Products unit of AIG.

"That man was Scott Polakoff..."

This pair of ignoble departures from the ranks of the new administration is another embarrassment for President Obama, whose term in office has already been marred by a series of disastrous high-level appointments.

The first days of Barack Obama’s administration has witnessed a host of controversial appointees, such as “energy and environment czar” Carol Browner; two of these individuals – Tom Daschle and Charles Freeman, were later obliged to remove their names from consideration in the wake of embarrassing revelations: Daschle owed $140,000 in back taxes, which he eventually repaid, while Freeman’s connections with Saudi Arabia and China raised questions about possible conflicts of interest.

Of the 385 posts at Cabinet-level agencies that a president must appoint, Obama had sent 100 names to the Senate as of March 24. So far, 38 of those individuals have been confirmed. The President has also announced over twenty-five additional nominations which have yet to be submitted to the Senate. Nine weeks into the new administration, hundreds of other posts remain vacant.

Other high level appointees have also forced to step aside during Obama’s first few weeks in office.

Former Governor of New Mexico Bill Richardson was the first famous name to withdraw. Widely touted during the Presidential campaign as a possible Secretary of State in an Obama administration, Richardson was tapped for the position of Commerce Secretary after Hillary Clinton landed the job at State. However, Richardson withdrew his name on January 4 due to a federal grand jury probe into “pay-to-play” contract influence allegations in his state.

Obama’s second choice for Commerce Secretary was a Republican, Senator Judd Gregg of New Hampshire, who later withdrew as well, citing policy differences.

An outspoken critic of the Iraq war, retired four-star Marine General Anthony C. Zinni, former Imperial commander in the Middle East, had been promised the job as Ambassador to Iraq in late January – then unceremoniously dropped from consideration.

On a single day, three different nominees backed out of senior positions with the Obama administration: Annette Nazareth, the nominee for Treasury deputy secretary; Dr. Sanjay Gupta, the senior medical correspondent with CNN who had been slated to step in as Surgeon General; and Caroline Atkinson, who’d been chosen to serve as undersecretary of international affairs by U.S. Treasury Secretary Timothy Geithner (who’d been confirmed after paying $35,000 in back taxes.)

Nancy Killefer was supposed to become Washington’s “first official waste watchdog”, but Obama’s choice to take the newly created post of White House Chief Performance Officer was also forced to withdraw due to pay unemployment taxes “on household help.”

(In her oddly worded official withdrawal statement, Killefer seemed eager to place blame for her decision elsewhere: “I recognize that your agenda and the duties facing your Chief Performance Officer are urgent. 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.”)

Meanwhile, last week Obama’s choice for “urban policy czar”, Adolfo Carrion, was named in an investigation into possible wrongdoing. According to the New York Daily News, Carrion paid only $24,400 for a $50,000 home renovation project when he was still Bronx Borough President, raising concerns about possible favoritism.

Asked about the troubles plaguing the Obama administration, Susan Collins of Maine, the top Republican on the Homeland Security and Governmental Affairs Committee, said that the White House’s “earlier vetting system was clearly flawed.” 

However, she added, “Now I think the administration may have gone to the other extreme and is being so stringent in its requirements and going through such a lengthy process that it is difficult for [nominees who] are willing to serve.”

The situation shows no sign of improving. Senator Orrin G. Hatch (R-Utah) is critical of two upcoming nominees for both ambassador to Iraq and for assistant attorney general at the Justice Department.
 
“There are a raft of others,” Hatch said. “I come at these matters with a desire to help the president, have him get the people he wants around him. But I’m really getting alarmed at some of the — I don’t want to call them all radicals — but some of the radical people who are being put into these sensitive, big-time positions.”

President Obama had promised a smooth transition from the previous administration of George W. Bush, as well as a thorough, transparent vetting process to ensure each appointee’s suitability for each job. This string of aborted appointments has so far tainted his brief time in the White House.

It seems ironic that Obama’s former rival and current Secretary of State, Hillary Clinton, a woman whose surname is practically synonymous to many with “corruption”, has so far proven to be the most worry-free member of the President’s team.