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BUSH PRESENTS MODEST AGENDA

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By MICHAEL ABRAMOWITZ and DAN EGGEN, The Washington Post

Published: January 29, 2008

Updated: 01/29/2008 12:12 am

WASHINGTON - Facing an unstable economy and an unfinished war, President Bush used his final State of the Union address Monday night to call for quick passage of his tax rebate package, patience in Iraq and $300 million in scholarship money for low-income children in struggling schools.

Bush told the American people that his strategy to stabilize Iraq is achieving results "few of us could have imagined just one year ago."

And he sought to reassure the public that his new stimulus plan will stave off the recession that threatens to overtake the nation's economy during the final year of his presidency.

Appearing before Congress for his seventh and last State of the Union address, Bush claimed vindication for his controversial decision a year ago to send a "surge" of about 30,000 additional troops to Iraq.

"The enemy is still dangerous and more work remains," Bush acknowledged, but with high-profile attacks, sectarian violence and civilian deaths falling, he said progress is unmistakable.

"Some may deny the surge is working," Bush said, "but among the terrorists there is no doubt. Al-Qaida is on the run in Iraq, and this enemy will be defeated."

Bush made clear he is not ready to accelerate a drawdown of U.S. forces, which are scheduled to return to pre-"surge" levels of 135,000 by midsummer. He cited a warning from Gen. David Petraeus, the top U.S. commander in Iraq, that pulling troops out too quickly risks the recovery of al-Qaida in Iraq and an increase in violence.

"Members of Congress," he implored, "Having come so far and achieved so much, we must not allow this to happen."

Priorities Shift To Economy

Bush's address highlighted the shifting priorities of an administration that had planned to focus its final year on the war and other international challenges, but has found itself moving quickly in the past month to address the burgeoning crisis in the economy.

The past year has brought a growing tide of bad economic news for the Bush administration, culminating in last week's global stock market panic over a collapsing housing market and other financial woes in the United States.

The president called on Congress to finish work quickly on a $150 billion stimulus package, urging lawmakers not to "load up" the initiative with measures beyond the tax rebates and business incentives he agreed to last week with House leaders.

"That would delay it or derail it, and neither option is acceptable," Bush said.

The president sought to calm citizens' financial fears.

"Our economy is undergoing a period of uncertainty, and at kitchen tables across our country, there is concern about our economic future," Bush said. But, he added, "In the long run, Americans can be confident about our economic growth."

The president did not seek to revive the kind of ambitious social reforms that animated his past State of the Union addresses, such as proposals to create private accounts for Social Security or provide a pathway to citizenship for illegal immigrants.

Instead, he offered a mixture of familiar initiatives, mixed in with modest new proposals on education, social services and assistance for military families, that his aides said stand a reasonable chance of approval before this summer's political conventions start in late August.

One new proposal, a "Pell Grant for Kids" program, would devote $300 million to new grants for low-income children to attend religious and nonpublic schools. Bush proposed writing into law the rules requiring federal agencies to give equal consideration to religious-based groups providing social services to the poor.

Bush, whose administration has come under fire in recent years over the poor treatment of injured soldiers, also unveiled several initiatives aimed at boosting federal assistance to families of veterans and active service members.

One proposal would give hiring preferences to military spouses throughout the federal government; another would allow soldiers and veterans to transfer unused GI education benefits to spouses and children.

Bush Seeks To Curb Earmarks

Bush's remarks suggested he remains undaunted by the low approval ratings that have characterized his presidency in recent years. "We have unfinished business before us," he said, "and the American people expect us to get it done."

Even as he struck a bipartisan tone, Bush made clear to Democrats that he intends to employ fully the powers of the presidency until his final hours in office.

Bush said he will use his veto pen and administrative powers to try to rein in the proliferation of "earmarks," the projects inserted by lawmakers into annual spending bills and totaling roughly $17 billion in the last budget.

Bush described such projects as wasteful government spending, and he warned he would veto any spending bill that does not cut in half the number and cost of earmarks from the year before. He also said he will sign an executive order requiring his agencies to ignore any earmark not included in the language of legislation.

"The people's trust in their government is undermined by congressional earmarks," Bush said.

Bush's pledge on earmarks was met with skepticism from Democrats, and even some in the GOP, who noted that the practice increased dramatically while the Republican Party controlled Congress.

"The number of earmarks exploded under Republican leadership in the House, and for six years President Bush did nothing to slow their growth," said House Majority Leader Steny Hoyer, D-Md.

In keeping with the traditional civility of the occasion, Bush was greeted warmly as he entered the House chamber.

On the economy, Bush painted a mixed picture.

"In the short run, we can all see that growth is slowing," he said. "America has added jobs for a record 52 straight months, but jobs are now growing at a slower pace. Wages are up, but so are prices for food and gas. Exports are rising, but the housing market has declined."

Information from The New York Times was used in this report.

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