Obama hit by withdrawal of Republican nominee
President Barack Obama's trouble filling key cabinet posts continued with the announcement that his latest choice for commerce secretary had dropped out.
Republican Judd Gregg withdrew his nomination citing "irresolvable conflicts" with the White House on issues including the near-800 billion US dollar stimulus package and a politically-sensitive census due to take place next year.
It is the fourth withdrawal of a nominee - and the second of a would-be commerce secretary - to affect the nascent Obama administration.
Announcing his decision, Mr Gregg - one of three Republicans who were to be drafted into the cabinet - said: "We are functioning from a different set of views on many critical items of policy."
He added: "I have found that on issues such as the stimulus package and the census, there are irresolvable conflicts for me.
"Obviously the president requires a team that is fully supportive of his initiatives."
The 61-year-old New Hampshire senator was Mr Obama's second choice for the post of commerce secretary.
His first, New Mexico Governor Bill Richardson decided to step away from the post last month amid questions over a state contract given to one of his political donors.
Further questions over Mr Obama's vetting process for nominees were raised last week when two other key aides were forced to withdraw.
Tom Daschle and Nancy Killefer withdrew from the posts of health secretary and chief performance officer respectively.
Both stepped down following revelations of personal tax failings, an issue that has also dogged Treasury Secretary Tim Geithner.
Speaking after Mr Daschle and Ms Killefer's withdrawal, Mr Obama said he had "screwed up".
In a round of TV interviews at the time he added: "I'm frustrated with myself, with our team."
The withdrawal of Mr Gregg will come as another setback as Mr Obama attempts to form his cabinet.
It will also further strip the new administration of its claims to aspire to a degree of bi-partisanship.
All but a handful of Republicans in Congress have given their support for the President's stimulus plan, which is aimed at kick-starting the stalled US economy.
The withdrawal of Mr Gregg also highlights the divide over the forthcoming census.
Prior to the announcement, political opponents of the President had complained of increasing White House involvement in the count. The Census Bureau comes under the remit of the Commerce Department.
The issue is deemed to be so important due to the fact that the count, which takes place every 10 years, affects how money is distributed in funding for schools, roads, hospitals and other large spending projects.
It also determines representation in the House.
Minority groups had raised concern over the nomination of Mr Gregg. They claimed that as chairman of the Senate panel overseeing the Census Bureau, he sought to cut funding leading to an undercount of minorities.
In a statement, Senate Republican leader Mitch McConnell of Kentucky said Mr Gregg "made a principled decision to return and we're glad to have him.
"He is among the smartest, most effective legislators to serve in the Senate - Democrat or Republican - and a key adviser to me and to the Republican Conference. It's great to have him back."
Responding to the withdrawal, White House Press Secretary Robert Gibbs said: "Senator Gregg reached out to the President and offered his name for Secretary of Commerce.
"He was very clear throughout the interviewing process that despite past disagreements about policies, he would support, embrace, and move forward with the President's agenda.
"Once it became clear after his nomination that Senator Gregg was not going to be supporting some of President Obama's key economic priorities, it became necessary for Senator Gregg and the Obama administration to part ways.
"We regret that he has had a change of heart."