The Obama administration is reportedly set to announce a plan that would cap executive pay and end bonuses at firms receiving future taxpayer bailouts. The New York Times reports an executive at a bailed-out company could make a maximum $500,000. However, the caps would not be retroactive and would only apply to future bailouts, not the money already disbursed. The move would come days after it was revealed Wall Street firms paid out more than $18 billion in bonuses last year.

Tom Daschle has withdrawn his nomination to become Secretary of Health and Human Services following scrutiny of his failure to pay tens of thousands of dollars in personal taxes. The Obama administration had initially ignored criticism after the disclosure Daschle had avoided paying more than $126,000 in taxes for the use of a friend’s chauffeur and car service. White House Press Secretary Robert Gibbs announced Daschle’s withdrawal.

White House Press Secretary Robert Gibbs: “As Senator Daschle said in the statement that we released and told the President on the phone, that he did not want to be a distraction to that agenda. Senator Daschle has served this country for almost three decades with distinction, and I think America can be proud of that service.”

The news came just two hours after Obama’s nominee to be chief White House performance officer, Nancy Killefer, also pulled her name from consideration because of unpaid payroll taxes for a household employee. Later in the day, President Obama took responsibility for the Daschle controversy.

President Obama: “Well, no, I don’t think Washington wins. I mean, look, the fact of the matter is Tom Daschle pulled out today. And I’m here on television saying
I screwed up. And that’s part of the era of responsibility, is not never making mistakes, it’s owning up to them and trying to make sure you don’t repeat them. And that’s what we intend to do.”

President Obama, meanwhile, has nominated Republican Senator Judd Gregg of New Hampshire to be Commerce secretary. If confirmed, Gregg would become the third Republican in Obama’s cabinet. If Gregg leaves the Senate, New Hampshire’s Democratic governor would choose his replacement.

The Senate has boosted the cost of the economic stimulus plan to more than $900 billion. On Tuesday, the Senate added new provisions funding medical research and tax breaks for car buyers. Meanwhile, the Senate rejected an amendment to add $25 billion in public works projects, including highway construction and public transportation.

The US could be losing its last military base in Central Asia and a critical part of its occupation of Afghanistan. Kyrgyzstan has announced it’s closing the Manas Air Base because of public outcry and a US refusal to pay a higher fee. The US has also refused to revoke the immunity of a US soldier who fatally shot a Kyrgyz truck driver in late 2006. The announcement came after Kyrgyzstan reached a $2 billion loan deal with Russia. Pentagon official dismissed the announcement, calling it “political posturing” to extract more money for the base’s use.

Meanwhile, in Pakistan, militants have destroyed a key bridge used to supply US-led troops in Afghanistan. The attack on the Khyber Pass is being described as the most serious attempt to threaten US supply routes in Afghanistan to date.

Iran has successfully launched its first domestically made satellite. Iran says the satellite is meant for research and communications. The launch comes amidst celebrations marking the thirtieth anniversary of the Iranian revolution that deposed the US-backed Shah from power and redefined Iran as an Islamic Republic.

In the Gaza Strip, the UN is accusing Hamas of seizing aid intended for needy residents. A UN spokesperson said Hamas police raided a UN warehouse storing blankets and food parcels. Israel has said Hamas has routinely taken UN supplies. But the UN says it’s the first time on record. Gazans continue to struggle to get desperately needed aid denied by the Israeli blockade. On Tuesday, a resident of Gaza City waited for hours at an aid center in Gaza City.

Resident: “I have seven children. They don’t work. Our situation is very bad. There is no gas, no fuel. We only use wood, and we have been waiting from the morning until the afternoon, and even so, we can’t fill our tanks. What can we do? May God revenge for this.”

Meanwhile, the Israeli government has announced another new West Bank settlement expansion that will violate the US-backed road map. Israel says it will establish a new settlement to replace a settlers’ outpost it hadn’t approved. Up to 1,400 housing units will be built under the plan. Last month, the Israeli group Peace Now reported settlement expansion increased nearly 60 percent in 2008.

At the State Department, Middle East envoy George Mitchell returned from his first trip abroad to announce a follow-up visit later this month.

Middle East envoy George Mitchell: “The situation is obviously complex and difficult, and there are no easy or risk-free courses of action. But I’m convinced, after a week there, that my original assessment, that with patient, determined and persevering diplomacy, we can help to make a difference and that we can assist those in the region achieve the peace and stability that people on all sides long for.”

Mitchell appeared with Secretary of State Hillary Clinton, who called for “an independent and viable” Palestinian state in the West Bank and Gaza. Ten years ago, the Clinton administration was forced to distance itself from Clinton when she made similar remarks as First Lady.

The satellite network DirecTV is being accused of censorship after reportedly refusing to air a commercial critical of US backing for Israel’s attack on the Gaza Strip. The spot was produced by the US Campaign to End the Israeli Occupation. It lists the number of Palestinian dead from Israeli attacks and criticizes Israel for blocking aid and supplies. It then calls for cutting US military aid to Israel, concluding, “President Barack Obama, we need a change of policy toward Israel/ Palestine.” The group says DirecTV abruptly refused to air the ad after having reached an agreement.

The Obama administration is reportedly readying a plan to offer Russia a major reduction to each country’s stockpile of nuclear weapons. The Times of London reports President Obama will propose to reduce stockpiles by 80 percent to 1,000 weapons each. Obama will also pledge to “review” the Bush administration’s missile program in eastern Europe. A newly created White House nonproliferation office would oversee the talks.

And in Minneapolis, the trial of a young activist accused of making Molotov cocktails during the Republican National Convention has ended in a mistrial. The accused protester, David Guy McKay, has said he fell victim to entrapment from an activist turned government informant named Brandon Darby. McKay says Darby came up with the idea for the firebombs and encouraged the activists to make them. McKay has been set free until a new trial begins next month.