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Mr. Richardson Withdraws
A campaign finance controversy sinks a Cabinet nominee.

Monday, January 5, 2009

NEW MEXICO Gov. Bill Richardson (D) made the right call in withdrawing as President-elect Barack Obama's choice for commerce secretary. Given the ongoing grand jury investigation into his administration's awarding of state contracts to a firm whose president contributed generously to Mr. Richardson's political committees, his confirmation would inevitably have been delayed and the controversy an unnecessary distraction for the new Obama administration. What's less clear is whether Mr. Richardson did anything wrong -- he claims that the investigation will show that "I and my administration have acted properly in all matters" -- or whether he is simply the victim of exquisitely bad political timing, with the pay-to-play scandal involving Illinois Gov. Rod Blagojevich (D) making otherwise survivable questions about Mr. Richardson's own fundraising activities untenable. It's also unclear whether Mr. Obama's transition team failed to adequately scrutinize Mr. Richardson -- after all, the Albuquerque Journal reported the grand jury probe in August -- or whether the political ground simply shifted on them in the wake of the Blagojevich arrest.

In the end, we suspect that the Richardson nomination will have little impact on the incoming administration, which will be judged on its handling of the much larger problems confronting it. Mr. Richardson's withdrawal is an unpleasant embarrassment, but it's an unusual administration that does not confront some trouble with a Cabinet nominee, and the trouble was resolved before it became an issue. The larger question raised by the withdrawal is, as with Mr. Blagojevich, the inevitable problems created by the unseemly intersection of large campaign contributions and even larger government contracts.

In Mr. Richardson's case, a California firm, CDR Financial Products Inc., received consulting contracts worth $1.48 million with the New Mexico Finance Authority for advice on transportation bond financing. In 2003 and 2004, around the time the contracts were awarded, CDR President David Rubin donated about $100,000 to two political committees connected to Mr. Richardson. Both Mr. Richardson and the company say that the two transactions are unrelated. Yet it is nearly impossible to avoid the stench of pay-to-play politics when campaign finance laws allow for large contributions and when those seeking state business are allowed to donate. Mr. Richardson's conduct may have been entirely legal, but his predicament underlines how important it is to change the flawed system of which he has been both beneficiary and victim.

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