Bush seeks to ease Americans' fears over economy

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The Independent US

George Bush sought to calm Americans' fears about the economy on Monday while charting a course he hopes will keep him relevant in his final year in office.

With the specter of recession supplanting the Iraq war as the top US concern, the President acknowledged in his final State of the Union address that growth was slowing but insisted the country's long-term economic fundamentals were sound.

He prodded Congress to act quickly on a $150 billion economic stimulus package laid out out last week and resist the temptation to "load up" the plan with additional provisions.

"In the long run, Americans can be confident about our economic growth. But in the short run, we can all see that growth is slowing," Bush said in a globally televised speech to Congress.

Politically weakened by the unpopular war in Iraq, eclipsed by the race to choose his successor and scrambling to stave off lame-duck status, Bush presented no bold new ideas.

Bush urged Americans to be patient with the mission in Iraq almost five years after the US-led invasion.

He touted security gains in Iraq he ascribed to a troop buildup ordered last January but gave no hint of any further troop reductions there, asserting that such decisions would depend on his commanders' recommendations.

Calling on Iran to "come clean" on its nuclear program, he issued a stern warning to Tehran, which he had branded part of an "axis of evil" in his 2002 State of the Union speech.

"Above all, know this: America will confront those who threaten our troops, we will stand by our allies, and we will defend our vital interests in the Persian Gulf," Bush said.

Bush's seventh State of the Union speech was a chance to set the tone for his waning months in the White House and try to salvage his frayed legacy before he leaves in January 2009.

Sandwiched between Saturday's Democratic presidential primary in South Carolina and Tuesday's Republican contest in Florida, Bush will struggle to make himself heard above the growing din of the 2008 election campaign.

Democratic White House hopefuls Sens. Hillary Clinton and Barack Obama attended the speech but Republican Sen. John McCain was campaigning in Florida where voters will choose their preference for the Republican nominee on Tuesday.

"What he offered was more of the same - a frustrating commitment to the same failed policies that helped turn record surpluses into large deficits, and push a thriving twenty-first century economy to the brink of recession," Clinton said.

But topping Bush's agenda was a push for congressional passage of a stimulus package meant to avert recession in an economy suffering from high oil prices and a housing slump.

"At kitchen tables across our country, there is concern about our economic future," Bush said, acknowledging rising food and gas prices and increasing unemployment.

He is trying to head off attempts by some Senate Democrats to expand the plan beyond the tax rebates and business investment incentives agreed with House of Representatives leaders last week.

The impetus for compromise is that no one, least of all an unpopular president nearing the end of his watch, wants to be blamed for an economic meltdown before the Nov. 4 elections.

Some economists say the stimulus measures may buy time but will not be enough to solve the woes that have roiled global financial markets.

"We're going to engender another bubble here because they're bailing the consumer and they're bailing out banks," said Michael Pento, senior market strategist at Delta Global Advisors in California.

Delivering the Democratic response to Bush, Kansas Gov. Kathleen Sebelius called the stimulus plan only a "temporary fix" and urged Democrats and Republicans to work together so "we won't have to wait for a new president to restore America's role in the world."

On Iraq, Bush was in a better position than a year ago, when he implored skeptical Americans to embrace his plan to send thousands more troops to Iraq.

"Our enemies in Iraq have been hit hard," he said. "They have not been defeated, and we can still expect tough fighting ahead."

He announced no new troop reductions despite continuing calls from Democrats for a withdrawal timetable, something polls show most Americans want as well.

Taking aim at Iran, Bush pressed Tehran not only on its nuclear program but to "cease your support for terror abroad."

Bush's ability to rally international support against Iran has been diminished by a US intelligence report that Tehran abandoned its nuclear weapons program in 2003.

Bush, a latecomer to the fight against global warming, also committed $2 billion for a new international fund to promote clean energy technologies and combat climate change.

He has faced international criticism for repeatedly rejecting caps on greenhouse gas emissions in the United States, the world's biggest polluter.

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