Caroline Kennedy made it official, confirming she would no longer seek a U.S. senate seat "for personal reasons." Those personal reasons likely have a lot to do with Teddy Kennedy.

Caroline Kennedy has been telling people she pulled out of senate contention due to uncle Ted's deteriorating health. But that was apparently after she learned she wouldn't get the gig anyway.

The Post is reporting that Caroline Kennedy just informed Gov. David Paterson that she is withdrawing her name from consideration to replace Hillary Clinton in the Senate due to "personal reasons." The Post describes the news as "stunning," which may be because the paper said the selection of Kennedy was "certain" just two days ago. But assuming the news is true, you can direct your bottles of congratulatory champagne to Andrew Cuomo at the following address: Office of the Attorney General, The Capitol, Albany, NY 12224-0341. [NYP]

Remember how everyone was arguing about Caroline Kennedy getting a Senate seat for like a week? And then everyone forgot about it? That was David Paterson's cunning plan!

Caroline Kennedy is basically a lock for Hillary Clinton's Senate seat, according to someone close to the governor according to CBS 2. Sheesh. Is it true?

Caroline Kennedy's embarrassing "ums" and "you knows" in the Times Saturday followed questions about why she wants to be senator. Funny, Ted Kennedy was doomed by the same question!

A statement sent to Defamer purports to offer an apology from Lorne Michaels, who regrets equating NY governor David Paterson's blindness to garden-variety retardation last week on SNL. But wait, says NBC: He's not sorry!

You thought Governor Paterson's proposed tax on non-diet drinks was silly? It gets better. As part of his new $121 billion budget, Paterson is also proposing an "iPod tax," which would assess state and local sales taxes on "digitally delivered entertainment services." [NYDN]

• Frank Bruni assesses the toll the recession's having on NYC restaurants. The silver lining: It's never been easier to snag a last-minute reservation. [NYT]
• A look inside Ortine, which opens on Wednesday. [GS]
• Expect further delays for Table 8 inside the Cooper Square Hotel. [Eater]
• Christophe Bellanca has landed at Laurent Tourondel's BLT Group. [TFB]
• Caracas Arepa Bar's Brooklyn outpost opens today. [BP]
• That can of Coke is going to cost you more pretty soon. Gov. David Paterson has proposed a 15% "obesity tax" on nondiet drinks. [NYDN]

• Sean Avery may be spending a lot more time in New York in the near future: Hockey's preeminent bad boy has been cut loose by the Dallas Stars just 23 games into a four-year contract. [NYP]
• Jennifer Aniston was supposedly so desperate to have a boyfriend during the promotional tour for Marley & Me that her camp started "shopping for potential dates." [P6]
• David Paterson was not at all pleased with the impression of him on SNL this weekend. [NYP]
• Naomi Watts and Liev Schreiber had a second son on Saturday. [People, E!]

Fred Armisen finally did a politician impersonation that made everyone laugh! But immediately someone was offended: New York Gov. David Paterson went after the Saturday Night Live cast member for mocking the disabled.

Sorry, fans of scandal-prone political dynasties: "The odds of Gov. Paterson choosing Caroline Kennedy to replace soon-to-be Secretary of State Hillary Rodham Clinton in the US Senate are no better than 20-1, a source close to the governor said yesterday." [NYP]

• Rosie O'Donnell, contradicting Barbara Walters' rosy description of relations on The View: "I'm not saying they loathe each other, but the fact of the matter is, there was not a lot of camaraderie off camera." [LAT]

The stock market rebounded a bit today, but the economic outlook for New York is turning increasingly grim. Gov. David Paterson announced today that he's now expecting the budget gap for next year to be $12.5 billion, almost double what was projected a few months ago. [NYT]

We thought the bizarre GOP attacks against "community organizers" were just commonplace venom against those dumb enough to try to "change the system" with anything other than money and its attendant political power, not necessarily coded messages (the disdain Rudy Giuliani displayed when snarling the words was surely his own ad-lib, as a noted enemy of communities, and ferrets). But one can forgive New York Governor David Paterson for reading a racial element into the odd slurs—"community organizing" does just sound like something the black communities need, right? But in stating as much, Paterson wandered into the national political fray, and now a McCain spokesman is accusing Paterson of "playing the race card" and also this is Obama's fault, because they are desperate, and this is all divisive and shameful. So ok! The "community organizer" thing has nothing to do with race, at all. Sheesh! Poor white guys, always in trouble for saying utterly harmless things, like calling NBC journalist Ron Allen (who is black!) "uppity". As we all know, uppity is just an all-purpose general term for "elitist," which is a post-racial term for fag. Right?

David Paterson revealed today that he totally supports efforts to keep Mike Bloomberg around for a third term as mayor. Oh, and he would have loved it if Mike had run for president, too. "Basically, the governor is a big fan of anything that would keep Bloomberg from running against him in 2010." [Daily Politics]

Where did John Edwards and Rielle Hunter have their first romantic interlude? At the Loews Regency Hotel on Park Avenue, which happens to be one of Edwards favorite hotels in town. (We're guessing, however, that the hotel's owner, Jonathan Tisch, won't be including this little fact in the official hotel brochure in the near future.) But Edwards isn't the only married man who picked the five-star property to carry on behind his wife's back. In 1997, former football star Frank Gifford—the husband of Kathie Lee—bedded nude model Suzan Johnson in suite 521. (Gifford later claimed a tabloid had set him up.) After the jump, a few of the hotels where some of the rich and powerful have cheated on their wives, stashed their goomahs, and/or ran up a huge mini-bar bill.

• An Abu Dhabi investment fund says it has agreed to an $8 billion commercial-finance partnership with General Electric. [WSJ]

(1) The 9th annual Art For Life Benefit took place on Saturday at Russell Simmons' East Hampton house. Despite tickets not selling out as fast as usual, the event played host to Aretha Franklin, Christy Turlington, Lorraine Bracco, Soledad O'Brien, David Paterson, Diddy, Padma Lakshmi, Brett Ratner, LA Reid, the cast of Real Housewives of New York, Al Roker, Kelly Bensimon, Alina Cho, Simon de Pury, and Porschla Coleman—whose break up with Simmons, judging by their behavior, is either incredibly amicable or no longer in effect. [PMc]

You know when you get really hungry and you're just dying for a delicious, rich, chocolatey piece of... Allen Grubman? Yes, indeed, you can pick up a slice of "Allen Grubman Double Chocolate Pudding Pie" at the tourist trap the Brooklyn Diner on West 57th Street. (It happens to be a block from Grubman's office.) Here are a few other dishes named after local boldface names.