Jim Johnson Falls on His Sword

June 11, 2008— -- Obama VP vettter Jim Johnson resigned on Wednesday, a mere 24 hours after Barack Obama was caught flat-footed answering questions about the former Fannie Mae executive's business ties.

"I would not dream of being a party to distracting attention from that historic effort," Johnson said in a statement. "I believe Barack Obama's candidacy for President of the United States is the most exciting and important of my lifetime."

Johnson said he had done nothing wrong, saying "blatantly false statements and misrepresentations'' had been written about him.

Johnson came under scrutiny over the weekend when The Wall Street Journal reported that he had received $7 million in loans for mortgages with rates below market averages from a special account controlled by the CEO of Countrywide Financial Corp, Angelo Mozilo.

Per ABC's Jake Tapper, the "perceived chasm" between Obama's rhetoric and his association with Johnson served as "a distraction for his campaign and an opportunity for his critics."

Obama and his aides have railed against Countrywide for its role in the on-going mortgage crisis.

While Johnson's decision to step aside will keep "vetting the vetters" in the headlines for the next 24 hours, it gives Obama a chance eventually to move on.

Both the presumptive Democratic nominee -- and his top surrogates -- had been struggling over the past couple of days to answer questions about the Washington insider who conducted vice presidential searches for John Kerry in 2004 and Walter Mondale in 1984.

Obama got the awkwardness rolling on Tuesday when he sought to downplay Johnson's importance by telling ABC's Sunlen Miller that his VP vetter was merely a volunteer.

"I am not vetting my VP search committee for their mortgages," said Obama. ". . . I would have to hire the vetter to vet the vetters."

While praising the leak-free process Johnson ran in 2004, John Kerry found himself downplaying Johnson's importance in the Obama campaign by saying on a Wednesday conference call with reporters that Johnson "hasn't been proposed for a confirmable position."

"He's not at a position to do anything except provide information to somebody who wants information," said Kerry.

Howard Dean also found himself parroting Obama's "he's-just-a-volunteer" line on Wednesday, per ABC's David Chalian.

"Jim Johnson doesn't work for the campaign. He doesn't get paid," Dean told reporters at a Christian Science Monitor breakfast. "He is a volunteer."

The McCain campaign reacted to Johnson's resignation by arguing that it called into question Obama's judgment.

"Jim Johnson's resignation raises serious questions about Barack Obama's judgment," said McCain spokesman Tucker Bounds in a statement. "Selecting the vice presidential nominee is the most important decision a presidential candidate can make and one even Barack Obama has said will 'signal how I want to operate my presidency.'"

"By entrusting this process to a man who has now been forced to step down because of questionable loans," he continued, "the American people have reason to question the judgment of a candidate who has shown he will only make the right call when under pressure from the news media. America can't afford a president who flip-flops on key questions in the course of 24 hours. That's not change we can believe in."

The kicker:

"[T]his is one of those, sort of, you know, Washington grab stories."

--John Kerry on Jim Johnson prior to the resignation. Kerry made his remarks on an Obama campaign conference call with reporters.

On the campaign front. . .

BARACK OBAMA

-- 1:00 pm ET: Attends town hall meeting, Kaukauna, WI.

As for the Republicans. . .

JOHN MCCAIN

-- 11:30 am ET: Meets with media, Boston, MA.

-- 1:30 pm ET: Attends town hall meeting in Nashua, NH.

-- 7:00 pm ET: Attends town hall meeting, New York, NY.

At the White House. . .

PRESIDENT BUSH

-- 4:55 am ET: Participates in a roundtable on business exchanges, Rome, Italy.

-- 6:30 pm ET: Meets with the President of Italy, Rome.

-- 7:20 am ET: Lunch with the President of Italy, Rome.

-- 12:00 pm ET: Meets with the Prime Minister of Italy, Rome.

-- 1:20 pm ET: Joint news availability with the Prime Minister of Italy, Rome.

-- 2:10 pm ET: Working dinner with the Prime Minister of Italy, Rome.

FIRST LADY LAURA BUSH

-- 3:35 am ET: Speaks at the International Conference in Support of Afghanistan, Paris, France

-- 7:50 am Speaks to the World food Program Executive Board, Rome, Italy.

POLITICAL NEWS STORIES ON ABCNEWS.COM

ABC News' Jake Tapper: Jim Johnson Quits Obama's VP Search Team LINK

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ABC News' Ron Claiborne: Colbert Issues 'Green Screen' Challenge to McCainiacs LINK

ABC News' David Chalian: DNC Chief Attempts to Take Back Seat to Obama LINK

ABC News' Jake Tapper: DNC Hammering McCain on "Not Too Important" Comments LINK

ABC News' Molly Hunter: Clinton Supporters to Women: Don't Vote For McCain LINK

ABC News' Jake Tapper: Couric: Clinton "Received Some of the Most Unfair, Hostile Coverage I've Ever Seen" LINK

ABC News' Jake Tapper: Playing the Age Card? Obama Camp Calls McCain "Confused," Jumps On McCain Comments on Iraq LINK

ABC News' Jake Tapper: McCain's VP Vetter Vetted Bork LINK

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