The state senator from Proctor accused Baucus and national Democrats of hitting below the belt with a negative campaign ad that implied he was a gay former hairdresser. Baucus is seeking his fifth term and had a 19-point lead in a recent poll by Lee Newspapers.
Taylor's withdrawal immediately raised comparisons to New Jersey's Sen. Bob Torricelli, who dropped out when he was trailing badly and was scarred by a Senate ethics investigation. Democrats got the State Supreme Court to let them replace Torricelli with Sen. Frank Lautenberg, over objections from the GOP, who unusccessfullly challenged it in the U.S. Supreme Court.
Montana Republicans haven't indicated what they will do but with Baucus's huge lead, a pinch-hit GOP or a write-in candidate would have a tough time winning. Taylor owned a chain of hair care salons and sold beauty products before entering politics.
The $100,000 ad in question, reportedly paid for by the Montana Democratic Party and the Democratic National Committee in Washington, shows Taylor on the daily television show he hosted in the early 1980s for his Salon and Beauty School. A clip features a younger, fully bearded Taylor in a tight-fitting leisure suit with a big-collared open shirt and gold chains, rubbing lotion on a man's face.
Disco music plays in the background as an announcer reads:
"State Sen. Mike Taylor once ran a beauty salon and a hair care school, until the Department of Education uncovered Taylor's hair care scam for abusing the student loan program and diverting money to himself -- abuse that causes innocent students to default on their loans, abuse that cost taxpayers thousands and lined Taylor's pockets. Mike Taylor. Not the way we do business here in Montana."
Taylor threatened to sue. He told Fox News the ad attacked his character and implied he was gay in the 1980s. He said he was not homosexual and "the innuendoes that I lined my pockets are totally untrue."
Democrats said Taylor paid $27,250 to settle audit allegations by the U.S. Department of Education and the Colorado Student Loan Program and they have documentation to prove it.
Third-party candidates make debate hay
It was a historic moment Wednesday night when for the first time all five candidates for governor in Massachusetts took the stage to debate taxes and the economy. Four of them were women.
The major party candidates -- Republican Mitt Romney and Democratic state Treasurer Shannon O'Brien -- generally ignored the presence of three third-party hopefuls and focused their remarks on each other. Romney, the former head of the Salt Lake City Winter Olympics, criticized O'Brien's record of supporting tax hikes.
"I'm sure she's going to say she doesn't want to raise taxes, but the truth is, that's what she's done in the past. That's what she'd do in the future as governor," Romney said.
O'Brien charged Romney with distorting her record in what she called a new "gutter" campaign ad.
"It's pretty clear that the Mitt Romney campaign grows desperate as they see themselves trailing," O'Brien said, referring to a recent poll that had her inching ahead.
Shut out in previous debates, Green Party candidate Jill Stein, Libertarian Carla Howell and Independent hopeful Barbara Johnson made the most of their time during the hour-long televised debate to draw attention to their platforms.
Howell touted her ballot initiative to eliminate the income tax in Massachusetts and cut $9 billion from the state's budget.
"Carla, almost everybody's angry about taxes," Romney said. "But I don't see how you have no income tax and still be able to afford our schools and care for the elderly."
O'Brien agreed that eliminating the income tax would cause widespread problems.
"You can't just eviscerate state government and expect that you're not going to hurt lots of people," O'Brien said.
Former President Bill Clinton came to Boston Thursday to lend his support to O'Brien's campaign.
Mud misses mark in California
Republican Bill Simon's stretch-run in the California governor's race misfired again this week when an attempt to "prove" incumbent Democrat Gray Davis was in violation of campaign finance laws fizzled in an embarrassing fashion.
The Simon camp had touted a "grip-and-grin" photo of Davis accepting a campaign contribution check from a police advocacy group in 1998 as having been taken in the lieutenant governor's office in the state Capitol, which would be a violation of state law.
The problem is that the photo was not taken in the off-limits Sacramento office but rather was caught on film in a private home in Santa Monica. As a result, Simon was put on the defensive with less than a month before the election.
"What should have been a large bomb going off in the Davis administration was turned instead on Simon," a Republican insider told the San Francisco Chronicle. "You would think they would have had something this important nailed down."
Simon has attempted to downplay the incident and stick to what he sees as the issues -- Davis's reputed lack of leadership and lust for campaign contributions. The police advocacy group that released the photo has tried to take the blame for the error.
The Davis campaign called a news conference Thursday at the home in Santa Monica where the photo was taken to discuss the "defamatory allegations."
New York Mayor Michael Bloomberg isn't worried about political fallout over his invitation to cast members of the HBO hit "The Sopranos" to march in the Columbus Day Parade.
Dominic Chianese, who plays Uncle Junior on the popular cable television show about the trials and tribulations of New Jersey mob boss Tony Soprano and his family, will appear with actress Lorraine Bracco, a native New Yorker who plays Dr. Jennifer Melfi, Tony's psychiatrist.
The Columbus Citizens Foundation, which has organized the annual Italian-American parade for 58 years, said the Sopranos weere negative stereotypes of Italians and asked Bloomberg to withdraw the invitation.
Bloomberg said he's "Da boss" and that it's impossible to do anything in New York City without upsetting somebody.
"I'm not here to win an ideological competition," Bloomberg told reporters. "This is New York. You can't do anything without people being upset.
"I apologize if anyone is offended. But you know, if you are offended, don't wave back when they wave at you."
It's a case of déjà vu all over again. Tony and the boys were upset about Native American protests against Columbus at the parade in a recent episode of the show.
Reparations flap in Michigan
The Detroit Free Press looked at the pre-debate positions of Michigan Attorney General Jennifer Granholm and compared them with what was said during Monday night's debate with Republican Dick Posthumus.
Granholm led Posthumus, 54 percent to 41 percent in a poll of 600 people released before they faced-off.
According to the newspaper, Granholm flip-flopped on slavery reparations, an issue of interest to many African-American voters in the state.
Granholm supported reparations when she spoke to the National Association for the Advancement of Colored People in July. She told the NAACP she backed a bill introduced by Detroit Congressman John Conyers in 1989, calling for congressional hearings on reparations to descendants of black slaves. Conyers' bill has never gotten out of committee.
During this week's debate in Grand Rapids, Granholm said she is "not in favor of writing people checks" and favored "repairing the torn social fabric" with equal opportunities for minorities.
The debate with Republican nominee Dick Posthumus was watched by a respectable 225,000 households in heavily black Detroit. A second debate in Detroit is set for Tuesday. A third proposed debate on Oct. 21 has been scrubbed since only Posthumus accepted.
(Hil Anderson in Los Angeles and Dave Haskell in Boston contributed to his report.)