Bush readies State of the Union address for new Democratic Congress

WASHINGTON -- President Bush's State of the Union address on Tuesday gives him a second chance to defend his new Iraq strategy to a nation soured on the war and a Congress poised to vote against the plan.

It will be the president's last major opportunity to shape America's legislative agenda before the fast-moving 2008 presidential campaign begins to drown out his message.

Bush is expected to strike a conciliatory tone on some domestic issues where he believes he can work with the first Democratic Congress in 12 years. On Iraq, he is expected to stand firm.

The nationally televised speech typically offers great political theater. This year, however, it comes just 13 days after the president's prime-time announcement of his decision to send 21,500 more U.S. troops to Iraq.

Since then, Capitol Hill -- the forum for the State of the Union address -- has grown more hostile.

Democratic support is building around a nonbinding resolution opposing Bush's plan for more troops. Some Republicans already critical of the White House's Iraq policy have embraced the idea and others are looking for ways to sign on.

Despite the political tensions, House Democrats invited Bush to speak at their annual retreat in Williamsburg, Va., on Feb. 3 and the president accepted.

White House officials said the State of the Union will not be a repeat of the Iraq speech on Jan. 10. They said Bush will speak broadly about the pressing challenges facing the United States at home and abroad.

Bush probably will try to link the war to the threat to America since the Sept. 11, 2001, attacks because fighting terrorism has such widespread appeal, said Bruce Riedel, a former official at the National Security Council and analyst at the liberal Brookings Institution.

"Fear is a commodity that the administration has sold before, and right now they're not having much success with the public or the Congress with the arguments they've trotted out on the [troop] surge," said Ridel.

The costs of the war and the deficit are expected to preclude Bush from announcing expensive new programs.

On the domestic side, the president will propose a tax deduction of $7,500 for individuals and $15,000 for families regardless of whether they buy their own health insurance or receive medical coverage at work.

If passed by Congress, the proposal would be the first time that workers could get a tax break if they bought their own insurance. But it also would be the first time that some employer-provided health-care benefits could be taxed. The first $15,000 in health benefits for a family would continue to be tax exempt for the employee, but any amount in excess of $15,000 would be subject to tax.

Health-care benefits provided by companies are currently exempt from personal income and payroll taxes, no matter the amount.

He also plans to highlight immigration and urge Congress to renew the No Child Left Behind education law, preserve tax cuts, balance the budget within five years and work to make the costs of the war more transparent in the federal budget.

As in his previous State of the Union addresses, Bush probably will lament the U.S. reliance on foreign sources of energy and express support for alternative fuels.

Auto industry officials expect the president to ask Congress once more for the power to change fuel economy standards for passenger cars.

The White House said Bush also will lay out his policy on global warming, but will not propose a mandate to cut greenhouse gases.

The president, who has begun rehearsing drafts of the speech, worked on his address over the weekend at the Camp David presidential retreat.

He was joined by Secretary of State Condoleezza Rice, national security adviser Stephen Hadley and chief of staff Joshua Bolten.

After the speech on Tuesday evening, Bush is scheduled to travel on Wednesday to Wilmington, Del., where he will talk about energy policy. On Thursday, he will discuss his health-care ideas in Lee's Summit, Mo.