Fedora Installation :: Mysql Fc14 Can't Create New User?

I installed mysql on FC14, but can't successfully create a new user. It lets me go through all the steps without complaint, but then I can't log into mysql as the new user.

Here's what I did.

1) yum install mysql mysql-server
2) service mysqld start ##sets up mysql
3) mysqladmin -u root password myownsecrectpass ##create a root password
3b) mysql -uroot -p; #log in as root, this works fine
4) CREATE DATABASE webdb;
5) CREATE USER 'anewuser'@'%' IDENTIFIED BY 'password123'; ##create anewuser with a passwd
6) GRANT ALL ON webdb.* TO anewuser@'%';
7) FLUSH PRIVILEGES;

Then I log out of mysql as root and try to log in like this
mysql -uanewuser -p

I enter the password and get this error:

ERROR 2002 (HY000): Can't connect to local MySQL server through socket '/var/lib/mysql/mysql.sock' (2)