Lake and Clinton reached the decision together in a private meeting yesterday afternoon in the White House living quarters, a senior White House official said.
"I have believed all my life in public service. I still do," Lake, the former White House national security adviser, said in a letter to Clinton. "But Washington has gone haywire. I hope that sooner, rather than later, people of all political views beyond our city limits will demand that Washington give priority to policy over partisanship, to governing over 'gotcha.'"
He called the nomination process "a political circus," a sentiment echoed by angry White House aides who waged an eleventh-hour campaign to persuade Lake to fight what they called a bruising, partisan confirmation process.
Clinton tried to talk Lake out of the withdrawal, White House spokesperson Mike McCurry said. He also quoted the president as saying Lake's treatment at the hands of the Senate Intelligence Committee was "inexcusable" and said Clinton was "angry and close to being despondent."
The withdrawal was a surprise because Lake had weathered several GOP attacks to emerge relatively unscathed from last week's confirmation hearings. The questioning was less harsh than expected, and Republicans on the intelligence committee said privately he would probably be confirmed.
Lake's nomination triggered a steady stream of questions. They included his support for a secret 1994 policy that allowed Iranian arms to flow to Bosnia and his failure to sell $280,000 worth of energy stock after being told to do so to avoid possible conflicts of interest.
More recently, Lake said that as national security adviser he was never told by subordinates about FBI suspicions that China was looking to influence U.S. congressional elections.
Questions also were raised about the NSC's role in White House policy that allowed several big-money Democratic donors access to the White House during the 1996 elections.
Lake's withdrawal raised immediate questions as to whether a new allegation cropped up to submarine his nomination.
But senior administration officials said no one development or new revelation prompted Lake to bow out.
Instead, it was a cumulative effect of Republican accusations. The last straw, aides said, was a White House determination this week that the intelligence committee would dither over his nomination for weeks, and not put it to a vote before summer.
Aides also said Lake's doctors were worried about his high blood pressure. Another factor was massive legal expenses incurred to answer questions about the stock transaction.
A senior aide, speaking on condition of anonymity, said Lake wrote the first draft of his withdrawal letter before the hearings began. He pocketed the letter after Clinton and a host of administration officials persuaded the popular aide to stick it out.
Lake's letter yesterday expressed concern about the apparent decision by Sen. Richard Shelby, (R-Ala.), chair of the Senate Intelligence Committee, to insist that all committee members review Lake's FBI file before voting on whether to recommend his confirmation to the full Senate.
While the senior official insisted that the file contained interviews that were uniformly favorable toward Lake, the nominee said he was concerned about setting a precedent which would open sensitive files to wide review.
In his letter of withdrawal, Lake said: "I had doubts about the precedent we have already set in allowing (Shelby) and the (committee's) vice chairman, (Sen. Bob Kerrey, D-Neb.), such access. To bend principle further would even more discourage future nominees to this or other senior positions from entering public service."
Lake and Clinton discussed a possible successor choice to head the $30 billion U.S. intelligence bureaucracy, but senior officials would not discuss the list of potential candidates. One aide said officials "are too sick over this" to consider replacement right away.
One name likely to be under consideration is action CIA director George Tenet, a CIA veteran and an official who appears to have cordial relations with lawmakers of both parties on Capitol Hill.
"There is no prospect for a near-term vote on the floor and every chance it will be extended as long as your political opponents can do so," Lake wrote Clinton. "I have gone through the past three months and more with patience and, I hope, dignity, but I have lost the former and could lose the latter as this political circus continues indefinitely."