A tricky first day back as Obama takes incoming on Petraeus affair

President's plan to outline his economic policy is eclipsed by military sex scandal

As he attempted to draw battle lines yesterday before negotiations start with Congress on taxes and spending cuts, President Barack Obama inevitably found himself dragged into the maelstrom surrounding last week's resignation of David Petraeus from the CIA and other allegations of misconduct.

In a first press conference since winning a second term, Mr Obama vowed not to abandon a campaign promise to raise taxes on the wealthy. But he was also bombarded by questions about Mr Petraeus' extramarital affair with his biographer, Paula Broadwell, and the ensuing revelations about email exchanges between the US commander in Afghanistan, General John Allen, and another woman in the case. Although the Petraeus resignation and its fall-out are for now eclipsing all other business in Washington, the President was at pains to keep his distance from the upheaval.

"My main hope right now is that he and his family are able to move on. General Petraeus has had an extraordinary career," Mr Obama said, adding that "so far" he had no evidence that any classified information had been exchanged between the parties.

More politically treacherous, however, was a rising clamour on Capitol Hill for answers from Mr Petraeus – and the President himself – on what exactly it was that led to the attack on the US consulate in Benghazi, Libya, on 11 September and the killing of four Americans including US ambassador, Christopher Stevens.

Mr Petraeus, who reportedly made a secret visit to Libya in the aftermath of the attack, is now expected to make a first appearance behind closed doors before the Senate Intelligence Committee as early as today.

The Petraeus debacle and the Benghazi affair are gravely complicating Mr Obama's plans for a cabinet reshuffle. Leading Republicans in the Senate, notably John McCain, vowed earlier to block Mr Obama from promoting Susan Rice, Ambassador to the UN, possibly to the job of Secretary of State, because of statements she made after the attack. These suggested that it was carried out by rioters who ran amok, rather than being perpetrated by militants as is now known to be the case. The President described the criticism of Ms Rice as "outrageous".

Fighting to save his career, General Allen has privately denied to the Pentagon that he ever had an affair with Jill Kelley, a socialite with a long history of entertaining top-ranking military from Central Command at MacDill Air Force base near her home.

Ms Kelley triggered the FBI investigation that led to the downfall of Mr Petraeus after asking the agency to look into threatening anonymous emails she had been receiving.

It turned out they had come from Mr Petraeus's mistress, Ms Broadwell. Ms Broadwell had also been sending emails to General Allen. He forwarded those to Ms Kelley.

Pending the outcome of the Pentagon investigation, Mr Obama has acceded to a request by the Defence Secretary, Leon Panetta, to put on hold a request that General Allen be confirmed as the next commander of US European Command as well as the Nato Supreme Allied Commander in Europe.

At issue is the nature of up to 30,000 pages of communications, most of them in the form of emails, exchanged over two years between General Allen and Ms Kelley.

Visiting Aust-ralia, Mr Panetta said he retained confidence in General Allen's ability to lead the International Security Assistance Force in Afghanistan pending the outcome of the Pentagon investigation.

"No one should leap to any conclusions here. General Allen is doing an excellent job," he said. "He certainly has my continued confidence to lead our forces and continue the fight."

In a further muddying of the military's reputation, Mr Panetta demoted General William "Kip" Ward, a former head of US Africa Command, for funding a lavish personal lifestyle by filing inflated expenses to the tune of tens of thousands of dollars.

He will retire now as a three-star general instead of as a four-star one.

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