Richardson Withdraws As Commerce Secretary Pick

New Mexico Gov. Bill Richardson has withdrawn his nomination to be commerce secretary in the Obama administration. Richardson took his name out of the running amid a federal grand jury investigation into government contracts.

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ARI SHAPIRO, host:

It's Morning Edition from NPR News. I'm Ari Shapiro.

STEVE INSKEEP, host:

And I'm Steve Inskeep. President-elect Barack Obama faces two awkward situations this week. One is the debate over filling his Senate seat, and we'll have more on that in a moment.

SHAPIRO: But we start with the other awkward situation. Obama's choice for commerce secretary has withdrawn from consideration. New Mexico Governor Bill Richardson faces questions about whether a company paid to get a state contract.

INSKEEP: The Albuquerque Journal first reported the allegations in August, so the Obama transition team had plenty of warning. NPR's Ted Robbins reports.

TED ROBBINS: The deal in question goes back to 2004. That's when CDR Financial Products, a California consulting firm, got contracts to advise the state of New Mexico on a bond issue to fund highway and light rail projects. The contracts were worth $1.4 million.

Meanwhile, in 2003 and '4, CDR and its president, David Rubin, gave $100,000 to two Richardson committees. One to register Hispanic and American Indian voters, the other to help the governor pay expenses at the 2004 Democratic Convention. CDR did not answer our request for comment. But no one, at least no one publicly, has said there was a link between the two actions.

So what has changed since Richardson was named to the Cabinet December third? Well, it's been widely reported, only in the last three weeks, that a grand jury in Albuquerque has begun investigating the allegations. Joe Monahan, who writes a blog called New Mexico Politics, says political tolerance toward alleged favors for money has also tightened in the last month.

Mr. JOE MONAHAN (Blogger, New Mexico Politics): I think the obvious thing that's changed is the situation with the Illinois governor and the pay-to-play allegations surrounding the appointment of that U.S. Senate seat. And that's shone a spotlight, perhaps more brightly, on the situation in New Mexico, causing, you know, more severe political problems for Richardson than the Obama team anticipated.

ROBBINS: In a written statement Sunday, Governor Richardson said he has done nothing wrong, but is pulling out as commerce secretary because the quote, "ongoing investigation also would have forced an untenable delay in the confirmation process," end quote. Few politicians in America have the breadth of experience that Bill Richardson has. He was a congressman, U.N. ambassador, and energy secretary before becoming governor. Trip Jennings covers state politics for the online New Mexico Independent. He says despite Richardson's experience, not everyone is happy to see him stay on as governor.

Mr. TRIP JENNINGS (Reporter, New Mexico Independent): You know, I think there's some folks in the legislature who were kind of breathing a sigh of relief that Governor Richardson was leaving New Mexico. They were wishing him well, but I think there were some folks in the legislature - not just Republicans, some Democrats, who viewed him as a bully.

ROBBINS: On the other hand, New Mexico Speaker of the House Manual Lujan says Richardson's return is a blessing in disguise. Like many states, New Mexico faces a budget deficit. Lujan says Richardson is up to speed on the issues, unlike Lieutenant Governor Diane Denish, who would have become governor if Richardson left. Lujan is a longtime Richardson ally who says the governor will come through the scandal unscathed. [POST-BROADCAST CORRECTION: The New Mexico Speaker of the House is named BEN Lujan.]

State Representative BEN LUJAN (New Mexico Speaker of the House): I have no doubt that he will be fine, and he himself, I'm sure, feels that way.

ROBBINS: President-elect Obama, in his own written statement, accepted Richardson's withdrawal. But he left open the possibility, even the desire, to have Bill Richardson as part of his administration in the future. Ted Robbins, NPR News.

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Richardson Withdraws Bid For Commerce Secretary

New Mexico Gov. Bill Richardson says he is withdrawing his name from consideration as commerce secretary with "great sorrow" amid an investigation into a company that did business with his state.

A grand jury is investigating how a company that contributed to Richardson's campaign won a lucrative New Mexico state contract. Richardson says he and his administration acted properly, but that the investigation would force a delay in the confirmation process. He says he could not, in good conscience, ask the president-elect to delay important Commerce Department work in the face of the economic situation the nation is facing.

President-elect Barack Obama says he accepted Richardson's decision with deep regret, and says he will move quickly to fill the void left by Richardson's withdrawal.

Richardson says he will remain as New Mexico's governor, and that he told Obama he is eager to serve in the future. The president-elect says he looks forward to Richardson's future service to the country — and in the Obama administration.

Correction Jan. 6, 2009

The story incorrectly identified New Mexico's speaker of the House as Manuel Lujan. His name is Ben Lujan.

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