Truth Or Consequences: Bill Richardson Withdraws As Commerce Designee

The obvious question: Where was the vetting of Bill Richardson, since there have long been reports about a "pay to play" scheme in New Mexico, questions about how a financial investment firm won a state contract shortly after making contributions to Richardson's political action committees. A grand jury has been on this for months. Richardson's former chief of staff, David Harris, was interviewed by the FBI last summer.

Trip Jennings writes in The New Mexico Independent that Richardson informed the Obama transition team about the federal investigation prior to his being named by Obama last month. But it's not that simple:

There is no indication that the probe will end soon. In fact, the federal grand jury asked to review evidence in the case during 2008 has been released from its duty, meaning a new grand jury empaneled this year must take up the case all over again, including witness testimony. And that could mean a drawn-out inquiry.

The surprising but shouldn't-have-been-surprising action: Richardson withdrew yesterday as President-elect Obama's choice for secretary of commerce. The New Mexico governor said he feared the investigation could prove to be a distraction to Obama and his new team. He denied any wrongdoing and said he would stay on as governor. (He is term-limited and cannot run again in 2010.) With "pay to play" coming under major scrutiny in Illinois -- albeit a bit late -- there was no way the new administration was going to allow a potential scandal to explode in its infancy. (For the record, no one is suggesting Richardson is a target of the investigation. But the investigation will no doubt look to what, if anything, the governor's office knew or did regarding the contributions and subsequent contract.)

The details: CDR Financial Products, based in California, made at least $110,000 in political contributions to Richardson's PACs. Not long after, it received a $1.48 million contract to work with the state. Coincidence? Absolutely.

Did he jump, or was he pushed? No one knows for sure. According to the New York Times' Sheryl Gay Stolberg:

Mr. Obama did not ask Mr. Richardson to step aside, associates close to both men said. But when Mr. Richardson offered to withdraw, the officials said, Mr. Obama simply accepted, without trying to persuade Mr. Richardson otherwise.

Now what: Richardson has to deal with the $450 million budget shortfall. It's one thing to travel the world's hot spots, meeting with world leaders. It's another banging heads with state legislators in Santa Fe.

Not so fast: Lt. Gov. Diane Denish (D) was measuring the drapes in the governor's office, having already named a transition team. She was long planning to run in 2010, but now it's unlikely she'll do so as an incumbent governor. Unless the investigation clears Richardson and he gets another administration post. Or unless there's more to the Richardson investigation than we know.

The next secretary of commerce? Some of the names suggested are those who were thought to be finalists for other Cabinet positions, such as Michigan Gov. Jennifer Granholm, Kansas Gov. Kathleen Sebelius or Rep. Xavier Becerra of California. But the betting is that Obama could pick someone completely new out of the hat. (With Richardson gone, Latino groups may renew their lobbying efforts on behalf of Becerra.)

Gone but not forgotten: Other administration would-have-beens-but-never-were include Linda Chavez, President Bush's choice for labor secretary; Zoe Baird and Kimba Wood, President Clinton's choices for attorney general; and Theodore Sorensen, President Carter's choice to head up the CIA.

1:01 PM ET | 01-05-2009 | permalink

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