Plugins won't install or delete through WordPress

I can no longer add, delete, or upgrade my plug-ins through the wordpress interface at Godaddy. I can manually copy them in with FTP and activate however. Every time I try to use wordpress I get the following prompt:

To perform the requested action, WordPress needs to access to your web server. Please enter your FTP credentials to proceed. If you do not remember your credentials, you should contact your web host.

This is followed by boxes to enter my FTP credentials (which I had never seen before). I’ve entered valid credentials but it just returns a blank page after processing for a while and no changes are made to my plugins. I’ve tried with multiple FTP accounts and multiple plugins.

This all may have started with the upgrade to wordpress 3.0.4 but I’m not sure.