Another one bites the dust:


Obama's budget czar quits in new tax storm

WASHINGTON (AFP) — President Barack Obama's government ethics crusade took a fresh blow Tuesday when Nancy Killefer, his pick for White House budget czar withdrew, and become the latest nominee to fall foul of tax issues.

Killefer said in a letter to Obama released by the White House that she was "reluctantly" asking to step aside as his pick for the government's first "chief performance officer" because of a "personal tax issue" in Washington.

Obama said in January that the choice of Killefer was "among the most important I will make" and her withdrawal follows tax storms which swirled around two other cabinet nominees that have rocked Obama's young government.

Treasury Secretary Tim Geithner and health secretary designate Tom Daschle have been forced to apologize during their confirmation process for past tax transgressions.

The controversies erupted even though the Obama transition team introduced what has been termed the most exhaustive vetting operation ever mounted for nominees for top government jobs in a bid to avoid confirmation missteps.

Killefer, a blue chip management consultant, was tapped to bring modern business practices to the White House, and to slash government waste with a long-term budget deficit of up to a trillion dollars looming.

As the economic crisis raged, she had been tasked by Obama to lead a thorough review of government spending and long-term commitments including Social Security retirement benefits and Medicare health insurance for seniors.

"I recognize that your agenda and the duties facing your Chief Performance Officer are urgent," Killefer said in her letter to the president.

"I have also come to realize in the current environment that my personal tax issue of DC 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."
Reports had circulated that Killefer had in the past failed to pay unemployment taxes due for employing a household helper.

Killefer was formerly a senior director at McKinsey & Company in Washington and was a former assistant secretary for management, chief financial officer, and chief operating officer at the Treasury Department.