Bush focuses on economy in last State of Union speech

WASHINGTON (CNN) -- President Bush used his final State of the Union speech Monday to call for a quick shot in the arm for the economy in "a period of uncertainty" and demand Congress hold the line on spending and taxes.

President Bush delivers his final State of the Union address Monday.

With his approval ratings in the low 30s, an opposition-led Congress and his presidency overshadowed by the race for his successor, Bush offered little new.
But he urged lawmakers to work together to complete unfinished business and called for quick steps to bolster an economy unsettled by a housing and credit crunch.
"At kitchen tables across our country, there is concern about our economic future," the president told the nation in his annual address. Interactive: Bush's message over the years »
"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."
The White House and leaders of the House of Representatives agreed on a $150 billion package of tax rebates and other measures aimed at spurring consumer spending and investment -- but the president warned Congress not to "load up the bill" with other measures.
"That would delay it or derail it, and neither option is acceptable. This is a good agreement that will keep our economy growing and our people working, and this Congress must pass it as soon as possible," he said.
Don't Miss
Read the transcript of the address
Dems respond to Bush's address
I-Report: Share your own State of the Union address
Bush pushes Congress to pass stimulus plan
Bush said he would cut or eliminate 151 "wasteful or bloated" government programs in his budget for 2009 -- cuts he said would total $18 billion of a budget that amounted to $3 trillion in 2008.
The president demanded Congress rein in "pork-barrel" spending in next year's spending bills, vowing to veto any measure that does not cut by half the number and cost of congressional "earmarks" -- spending on special projects often slipped into bills at the last minute.
He said he would order federal agencies to ignore any appropriations that were not directly voted on by Congress, saying that spending undermines "the people's trust in their government."
The plan will not apply to the nearly 12,000 earmarks for fiscal 2008 that passed late last year -- and Democrats were quick to point out that roughly half of those earmarks were sponsored by Republicans, some with White House support.
Bush also urged lawmakers to work together despite the upcoming November elections.
"Let us show our fellow Americans that we recognize our responsibilities and are determined to meet them," he said. "And let us show them that Republicans and Democrats can compete for votes and cooperate for results at the same time."
Democratic congressional leaders said they would work with Bush and with the Republican minority in Congress on a "timely, targeted and temporary" boost for Americans amid the looming slowdown.
"The President's vision tonight may have been too small for many of the challenges we face, but his pledge to 'cooperate for results' is right for the times," House Speaker Nancy Pelosi, D-California, and Senate Majority Leader Harry Reid, D-Nevada, said in a written statement.
On Iraq, having successfully resisted Democratic efforts to bring the nearly five-year-old war to an end, Bush touted what he called the success of his decision to commit an additional 30,000 troops to the fight last year. But while he said those troops had reversed the bloody tide of sectarian warfare, U.S. troops will still be needed to preserve those gains.
"Our enemies in Iraq have been hit hard," he said. "They are not yet defeated, and we can still expect tough fighting ahead."
Critics said the goal of the U.S. campaign -- to get Iraqi leaders to reach political settlement of the conflict -- has not borne fruit. But Bush said U.S. officials "are seeing some encouraging signs" there, including the movement by Sunni Arab leaders to turn against Islamic jihadists loyal to al Qaeda.
"Ladies and gentlemen, some may deny the surge is working, but among the terrorists there is no doubt: Al Qaeda is on the run in Iraq, and this enemy will be defeated," Bush said.
He said about 20,000 of the additional troops dispatched last year will be coming home in the coming months, but repeated his stance that further withdrawals from the widely unpopular conflict would be based on the recommendations of U.S. commanders.
Meanwhile, Bush again called on neighboring Iran to halt its uranium enrichment program and warned it to avoid interfering with American operations in the Middle East, telling the Islamic Republic that "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."
Most of the goals Bush laid out were modest compared to previous years, when he used the State of the Union to sell big projects such as invading Iraq, partially privatizing Social Security or developing alternative fuels -- and many of the concepts Bush included were repackaged.
Bush included a new plug for last year's proposal for tax breaks for individual health insurance, framing it as an expansion of "consumer choice, not government control" -- an implicit jab at Democratic presidential contenders, all of whom advocate universal health care.
A longtime conservative goal -- federally backed vouchers for students to attend private schools -- was repackaged as a $300 million "Pell Grants for Kids" program aimed at keeping religious and parochial schools in inner cities. Watch Bush explain his plans for schools
He threatened to veto any tax increases in his final year and repeated his lonsgstanding call to lawmakers to make permanent the $1.6 billion in tax cuts approved during his presidency. Watch Bush pledge to veto tax increases
He left Congress to deal with two previous goals, an overhaul of U.S. immigration laws and Social Security. White House-backed immigration bills failed in Congress in 2006 and 2007, and Bush's Social Security plan did not make it into a bill.
Bush said Social Security and the health-care entitlements Medicare and Medicaid are forcing "painful choices" without long-term changes.
"I have laid out proposals to reform these programs," he said. "Now I ask members of Congress to offer your proposals and come up with a bipartisan solution to save these vital programs for our children and grandchildren."
Among other proposals in the 53-minute speech, the president:
Announced plans to hold the annual North American Summit of U.S., Canadian and Mexican leaders in New Orleans, still rebuilding from the devastation of Hurricane Katrina in 2005. White House spokeswoman Dana Perino said the president decided to hold the summit there to send a signal about the city's redevelopment since the hurricane, which killed more than 1,800 people on the Gulf Coast. The president and top administration officials were widely pilloried for their response to the hurricane, which left more than three-quarters of New Orleans flooded. The government has committed more than $100 billion to reconstruction in the disaster zone, and Bush said, "We reaffirm our pledge to help them build stronger and better than before."
Took a swipe at Venezuelan President Hugo Chavez, urging Congress to pass a trade agreement with Colombia or risk emboldening "the purveyors of false populism in our hemisphere."
Repeated his goal of reaching a settlement of the decades-old Israeli-Palestinian conflict, including the establishment of a peaceful, democratic Palestinian state, by the end of 2008.

SKorea races to save 22 hostages

KABUL, Afghanistan (AP) -- A top South Korean envoy is headed to Afghanistan, scrambling to save 22 of his country's citizens held captive by Taliban kidnappers after the militants killed one hostage.

However, a local police chief said that the negotiations with the captors were difficult because their demands were unclear.
"One says, let's exchange them for my relative, the others say let's release the women, and yet another wants a deal for money," said Khwaja Mohammad Sidiqi, a local police chief in Qarabagh. "They have got problems among themselves."
On Wednesday, authorities found the bullet-riddled body of 42-year-old Bae Hyung-kyu in Qarabagh district of Ghazni province, where the South Koreans were abducted July 19. Church officials said he was killed on his birthday.
Bae was found with 10 bullet holes in his head, chest and stomach, said Abdul Rahman, a police officer. Another Afghan police official, who asked not to be identified because of the sensitivity of the situation, said militants told him the hostage was sick and couldn't walk and was therefore shot.
Bae's mother, 68-year-old Lee Chang-suk, broke into tears as she watched the televised government announcement of her son's death.
"I never thought it possible," she said from her hometown on the southern island of Jeju, according to Yonhap news agency.
The kidnappers "will be held accountable for taking the life of a Korean citizen," Baek Jong-chun, South Korea's chief presidential secretary for security affairs, said in a statement before departing for Afghanistan to consult with top Afghan officials on how to secure the release of the remaining captives.
Don't Miss
Taliban: One South Korean dead; more to follow if demands not met
Germany: Dead hostage has gunshot wounds
Special Report: Fighting Terror
After conflicting reports Wednesday from Western and Afghan officials that possibly eight of the other hostages had been released, South Korean presidential spokesman Chun Ho-sun said the 22 were still believed held but were not suffering from health problems.
Qari Yousef Ahmadi, a purported Taliban spokesman, said all 22 hostages were fine but claimed that Afghan authorities were not allowing South Korean officials to negotiate directly with the militants.
"Kabul officials asked us to give them more time," Ahmadi said, speaking by phone from an undisclosed location. "The Taliban are not asking for money. We just want to exchange our prisoners for Korean hostages ... When they release the Taliban we will release the hostages."
Chun said South Korean President Roh Moo-hyun had spoken with his Afghan counterpart Hamid Karzai, but did not disclose the contents of their discussion.
Ghazni police chief Ali Shah Ahmadzai said that the Afghan negotiators were speaking with the Taliban over the phone, in a hope of securing the hostages release.
"We will not use force against the militants to free the hostages," he said. "The best way in this case is dialogue."
Ahmadzai said he was hopeful about reaching "some sort of deal for the release of six up to eight people" later Thursday, without giving an explanation for his optimism.
Chun said that both governments were cooperating and that an Afghan official had told South Korea earlier Thursday that Kabul intended to negotiate with the Taliban. He said Seoul was aware of the Taliban's current demands but declined to specify them.
Seoul also repeated its call that no rescue mission be launched that could endanger the captives further.
"We oppose military operations and there won't be military operations that we do not consent to," Chun said.
Marajudin Pathan, the governor of Ghazni province, said militants have given a list of eight Taliban prisoners who they want released in exchange for eight Koreans.
An Afghan official involved in the negotiations earlier said a large sum of money would be paid to free eight of the hostages. The official also spoke on condition he not be identified, citing the matter's sensitivity. No other officials would confirm this account.
Foreign governments are suspected to have paid for the release of hostages in Afghanistan in the past, but have either kept it quiet or denied it outright. The Taliban at one point demanded that 23 jailed militants be freed in exchange for the Koreans.
The South Koreans, including 18 women, were kidnapped while on a bus trip through Ghazni province on the Kabul-Kandahar highway, Afghanistan's main thoroughfare.
South Korea has banned its citizens from traveling to Afghanistan in the wake of the kidnappings. Seoul also asked Kabul not to issue visas to South Koreans and to block their entry into the country.
Because of a recent spike in kidnappings of foreigners -- including an attempt against a Danish citizen Wednesday -- Afghan police announced that foreigners were no longer allowed to leave the Afghan capital without their permission.

Thai Supreme Court to hear corruption case against Thaksin

BANGKOK, Thailand (AP) -- Thailand's Supreme Court agreed Tuesday to hear a corruption case against ousted Prime Minister Thaksin Shinawatra over alleged wrongdoing in a land deal, in the top court's first case against the exiled former premier.

Thaksin, who has lived overseas since his government was toppled in a military coup last September, is charged with corruption, conflict of interest and dereliction of duty for personal gain in the case, involving a multimillion-dollar plot of land in central Bangkok.
"The Supreme Court political crime section accepts the case, and sets the first hearing for August 14," Thongloh Chomngam, chief of the nine judges, read from a prepared statement.
Thaksin's wife Pojamarn is also named in the case, and the court ordered them both to appear in court for the first hearing.
Noppadol Pattama, the lawyer and de-facto spokesman for Thaksin and his family, reiterated previous statements that Thaksin will not return to face trial.
Don't miss
Thaksin charged with corruption
"I fear that my client will not get a fair trial because the judicial system in Thailand has been interfered with by some powerful groups, and I also fear for his safety," Noppadol told The Associated Press in a telephone interview.
Thaksin, prime minister from 2001-2006, was ousted by the military after demonstrations calling for him to step down because of alleged corruption and abuse of power. Another controversial business deal by his family, the $1.9 billion sale last year of telecommunications company Shin Corp. to a Singapore state investment company, contributed to public discontent

London on alert after explosives discovery

LONDON, England (CNN) -- Security across London has been increased after police on Friday discovered two cars filled with explosives.
Meanwhile, police increased patrols across London in a hunt for what they said is a man seen running from one of the cars on Friday.
British officials said hundreds of people could have been killed if the devices in the cars had been set off.
The first car was discovered parked near Piccadilly Circus; the second was found about an hour later, less than a kilometer away near Trafalgar Square.
Scotland Yard authorities said they believed the two incidents were connected.
On Friday, London police said the second discovered car -- containing fuel, gas canisters and nails -- was "clearly linked" to the first explosives-packed car found outside a nightclub near Piccadilly Circus, Metropolitan Police said.
A "considerable" amount of fuel and gas canisters, along with a "substantial quantity of nails," was found in the blue Mercedes 280E, said Peter Clarke, Metropolitan Police deputy assistant commissioner, said about the second car.
He called the discovery of the second bomb "troubling," but urged the public to remain vigilant and report suspicious behavior to authorities.
The second vehicle was ticketed about 2:30 a.m. Friday (9:30 p.m. Thursday ET), Clarke said. It was near Trafalgar Square, roughly a half-mile from where the first vehicle -- also a Mercedes -- had been found about an hour earlier. (Watch how the second car was armed )
About 3:30 a.m., Clarke said, the Mercedes was taken to an impound lot in Hyde Park. Security sources earlier told CNN that workers who towed it thought the car smelled of gasoline, and became suspicious because of the reports that gasoline was among the explosive materials found in the first vehicle.
Clarke said the second device, like the first, was "potentially viable" but was rendered safe by police explosives officers.
"These vehicles are clearly linked," he said.
The first car, a silver Mercedes-Benz sedan, was discovered about 1:30 a.m. when an ambulance crew called to treat an ill person noticed what appeared to be smoke inside the car and notified authorities, London police said.
The car was parked in front of the Tiger Tiger club, and the discovery prompted the closing of several streets until the vehicle was hauled off nine hours later.
"In the car, they found significant quantities of petrol together with a number of gas cylinders," Clarke said. He could not immediately say how much fuel was there.
"I can tell you it was in several large containers," Clarke said. "There were also a large number of nails in the vehicle."
He said explosives officers manually disabled "a potential means of detonation for the gas and the fuel in the vehicle," which preserved crucial forensic evidence for investigators.
A cell phone was found as part of the device in the silver car, according to security sources with knowledge of the investigation, although it was not immediately known what role the cell phone may have played in the device. The sources said the device was apparently set up to be remotely detonated.
Metropolitan Police Counterterrorism Command officers are reviewing closed-circuit security camera video to see if they can determine who parked the car there, Clarke said.
London has a long history of bomb attacks and alerts during decades of violence mounted by Northern Irish guerrilla groups. Lone attackers also have previously targeted the city's gay and immigrant communities. (Timeline of attacks)
Friday's incident came days ahead of the second anniversary of July 7, 2005, when four Islamic extremist suicide bombers killed 52 people on London's transport system in the deadliest strike on the city since World War II.
Witness Daniel Weir said he was walking home from work when he noticed police had cordoned off the area around the nightclub and a nearby vehicle.
He snapped several photos, including one that showed a canister labeled "patio gas." (See the photos)
Clarke said it was too early to determine if the smoke the ambulance crew saw was an indication that the car bomb had been activated but failed to explode.
While Clarke would not speculate that Tiger Tiger was the target, he said "some features of what's happened resonate with previous plots."
"In one previous case we heard talk about nightclubs potentially becoming targets. ... We, of course, saw reference to vehicles being filled with gas or fuel in order to create an explosion," he said.
There had been no intelligence warning of an attack, he said.
"It is obvious that if the device had detonated there could have been significant injury or loss of life," Clarke said. "The vehicle was parked in one of the busiest parts of central London in the early hours of Friday morning when many, many people were leaving nightclubs and other places after the evening hours." (Watch police describe potential blast )
British Home Secretary Jacqui Smith said, "We're currently facing the most serious and sustained threat to our security from international terrorism."
The bombs were found just two days after new Prime Minister Gordon Brown took office, and one day after he appointed members of his Cabinet. (Full story)
"For Gordon Brown, it is a rude awakening to the realities you take on as prime minister," CNN's European political editor Robin Oakley said. (Watch Oakley comment on 'rude awakening' for Brown )
Brown, whose predecessor, Tony Blair, stoked anger among Islamic militants with his support for the Iraq war, said Britain faces "a serious and continuous threat" and the public "need to be alert" at all times.
The incident also came days ahead of the second anniversary of July 7, 2005, when four Islamic extremist suicide bombers killed 52 people on London's transport system in the deadliest strike on the city since World War II.

Shuttle completes mission in California

EDWARDS AIR FORCE BASE, California (AP) -- Atlantis and its seven astronauts returned to Earth safely Thursday, ending a two-week mission to deliver an addition to the international space station and bring home a crew member from the outpost.
Atlantis had to use its backup landing strip in California after rain and clouds over Florida ruled out Kennedy Space Center.
"We couldn't quite get comfortable with [Kennedy]," Mission Control told the Atlantis crew. "We are going to target Edwards."
The crew executed the landing on its first opportunity at Edwards at 3:49 p.m. ET.
Rain and clouds that scrubbed a planned Thursday landing in Florida continued Friday, and NASA waved off the first planned landing there, which would have been at 2:18 p.m. ET.
The landing site at Edwards had clear skies, and wind gusts there were not expected to pick up until late in the day.
"Our mind-set down here is we're going to land you somewhere safely today," Mission Control told the shuttle crew Friday morning.
Aboard Atlantis, the astronauts closed the shuttle's payload bay doors in preparation for landing. The doors are opened during flights so heat doesn't build up in the orbiter.
Atlantis commander Rick Sturckow said the crew would put on their orange spacesuits for landing.
"That sounds great, Houston," Sturckow said. "We're going to suit up then."
Among the crew returning to Earth was astronaut Sunita "Sunni" Williams, who spent 195 days on the space station, a women's endurance record.
The crew had three chances Friday to land at Edwards, the last at 6:59 p.m. ET. If the weather had spoiled all those opportunities, mission managers would have tried again Saturday, with another backup landing site in New Mexico in the lineup.
The preferred landing site is Kennedy, where it is easier and far cheaper to get Atlantis to its hangar to be prepared for its next mission in December.
Lands in California means it will cost $1.7 million and take up to 10 days to get it home to Florida aboard a jumbo jet.
Atlantis had enough power for its systems to orbit until Sunday, but managers didn't want to wait that long. The flight would have been extended to Sunday only if technical problems needed to be fixed.
During Atlantis' two chances to land Thursday, showers were within 34 miles of the landing strip at Kennedy Space Center, and clouds hung below an altitude of 8,000 feet, both violations of flight rules.
During the crew's 14-day mission to the international space station, the astronauts installed a new truss segment, unfurled a new pair of power-generating solar arrays and activated a rotating joint that allows the new solar arrays to track the sun.
Originally scheduled for 11 days, the mission was extended by two days to give astronauts time to repair a thermal blanket that had peeled away during the June 8 launch. Astronaut Danny Olivas stapled it back into place during a spacewalk. Another extra day in orbit was added after the weather in Florida prevented a landing Thursday.
The shuttle's visit to the space station was complicated by the crash of Russian computers that control orientation and oxygen production. (Watch how the cosmonauts fixed the computers )
Atlantis helped the station maintain its orientation for several days until the computers were revived. Cosmonauts Fyodor Yurchikhin and Oleg Kotov used a cable to bypass a circuit board.
The cosmonauts at the space station attempted to power the Russian computers Thursday without using the cable bypass, but it was unsuccessful.