WASHINGTON (Reuters) - Senate Democrats on Tuesday yielded to the wishes of President-elect Barack Obama and allowed Joe Lieberman to keep his committee chairmanship despite having backed Republican John McCain for the White House.

Slideshow ( 4 images )

At a closed-door meeting, Senate Democrats meted out lesser punishment, passing a resolution of disapproval and stripping Lieberman of the chairmanship of an environment subcommittee.

There were fears that Lieberman, a former Democrat turned independent, might become a Republican if he lost the chairmanship of the Homeland Security Committee.

“This is not a time for retribution,” said Senate Majority Leader Harry Reid, a Nevada Democrat, adding that “we need to be unified” as the Democratic-led Congress wrestles with a host of problems, including the worst economic crisis since the Great Depression.

“This is all about going forward,” Lieberman, flanked by a number of Senate Democrats, told reporters.

Democratic aides said Obama, shortly after winning the November 4 election for the presidency over McCain, urged Democrats to do what it takes to keep Lieberman, who represents Connecticut, in their Senate conference where he routinely votes with them.

Lieberman allowed Democrats to retain control of the Senate, 51-49, the past two years by caucusing with them. Democrats enlarged their Senate majority in the November 4 election, but many believe they could still use Lieberman’s vote on a number of issues.

With newly elected Senate Democrats voting, the Democratic conference agreed on a 42-13 tally to allow Lieberman to keep the chairmanship of homeland security as well as a Senate armed services subcommittee, but lose the chairmanship of an environment subcommittee.

Lieberman backed McCain for president largely because McCain, unlike Obama, supported the unpopular Iraq war. In campaigning for McCain, Lieberman routinely ripped into Obama as misguided on what to do about the war, now in its sixth year.

The resolution approved by the Senate Democrats said their caucus “disapproves and rejects statements made by Senator Lieberman against Senator Obama during the campaign for the presidency.”

Said Reid, “I defy anyone to be more angry than I was” with Lieberman’s words, calling it “a period of time in Joe Lieberman’s political career I will never understand or approve.”

But Reid then talked about Lieberman’s contributions to Senate Democrats and to the country, recounting that as a young man Lieberman traveled to the South to work in the civil rights movement. In 2000, Lieberman, a moderate, was Democratic presidential nominee Al Gore’s vice presidential running mate.

Lieberman won re-election to a fourth term in the Senate as an independent in 2006 after losing the Democratic primary due mostly to his support for the Iraq war.

Lieberman then served in the Senate with both presidential candidates -- McCain representing Arizona and Obama serving Illinois until he resigned on Sunday.