All nations committed to freedom and peace will have to step up in the war on terror and take a stand, President Bush said Tuesday.

"No nation can be neutral in the struggle between civilization and chaos. Every nation that stands on the side of freedom and the value of human life must act against the few who would destroy the hopes of many," Bush told some 6,000 members attending the 85th convention of the American Legion (search) in St. Louis.

The president has been trying to inject new energy into the war on terror as complaints begin to rise about the cost of operations, the length of time U.S. troops will be committed to serving in Iraq and the growing casualty rate there.

"During the last few decades the terrorists grew bolder, believing if they hit America hard, America would retreat and back down," Bush said. "Five years ago, one of the terrorists said that an attack could make America run in less than 24 hours. They're learning something different today. The terrorists have not seen America running, they've seen America marching.

"Retreat in the face of terror would only invite further and bolder attacks. There will be no retreat," Bush said.

Two hundred seventy-seven soldiers have died since the war began on March 19, but Tuesday crossed a psychological barrier for many Americans. It marked the day that more soldiers had died in Iraq since major combat ended than had died during the war.

The Pentagon released numbers that showed 178 soldiers had been killed in action since March 19, 114 of them during the war and 62 since President Bush declared on May 1 that major combat operations were over. Another 99 soldiers died from illness, accidents and suicide since March 19, 24 of them during the war and 77 since the United States began its reconstruction effort.

A free and stable Iraq will require a substantial commitment of time and resources, Bush acknowledged, but he said the more democracy can unfold, the more terrorism will lose its base of support in the Middle East.

"Al Qaeda and the other global terror networks recognize that the defeat of Saddam Hussein's regime is a defeat for them. They know that a democratic Iraq in the heart of the Middle East would be a further defeat for their ideology of terror. They know that the spread of peace and hope in the Middle East would undermine the appeal of bitterness, resentment and violence," he said.

The president pitted the situation in Iraq as one of good versus evil. Middle East peace, not only in Iraq, but between Israel and Palestinians and among nations governed by tyrants must see success in order to find the strength to change their own futures.

"It is the rise of democracy that tyrants fear and terrorists seek to undermine. The people who yearn for liberty and opportunity in countries like Iran and throughout the Middle East are watching and they are praying for our success in Iraq," Bush said.

Retired Gen. Tom McInerney agreed that operations in Iraq are leading up to engagement for the entire Middle East.

"They know their goose is cooked. They are finished and that's why the battle for the Middle East is taking place in Iraq," McInerney told Fox News.

In addition to progress in Iraq, — 38,000 Iraqis are serving in the police force and the Iraqi Governing Council has begun assuming control over the country — the president said that U.S. and newly-recruited Afghan Army forces are working together on Operation Warrior Sweep (search), clearing out terrorists that would set back democratic reforms there. 

But even though terrorists are down, they are not yet out, he said.

"Al Qaeda is wounded, yet not destroyed. It remains a grave danger to the American people. Terrorist networks are still finding recruits and still plotting attacks and still intending to strike our country," Bush said.

Support for the war in Iraq continues at about the same levels as one month ago. About six in 10 people said the war was worth fighting, according to an ABC News poll released Monday. Approval of the president's handling of Iraq is at about 56 percent. Those numbers mirror polls taken in July. Sixty-nine percent said the United States should remain steadfast in Iraq until order is restored.

But not everyone is satisfied with Bush's performance. About 75 people protested the president's arrival in Minnesota, and carried signs that said, "Admit failure. Beg the U.N. for help" and "Search for economic recovery," a reference to the hunt for weapons of mass destruction in Iraq.

On Tuesday, Missouri Rep. Dick Gephardt, another Democratic candidate for president, called on Bush to seek help from the United Nations and NATO to bring peace to Iraq.

"If we're going to succeed in winning the peace in Iraq, we're going to have to have help," Gephardt said in a telephone conference call with reporters. "We need people."

In St. Louis, Bush appealed to the veterans on issues that are meaningful to them — health care and veterans services. He said during his administration, the Department of Veterans Affairs' budget has increased by $15 billion or 30 percent.

"The department, under [Department Secretary Anthony Prinicipi's] lead, has made major progress in reducing the backlog of veteran's disability claims and the number of veterans waiting for health care," he said.

Bush also thanked the veterans for their service to their country.

"Having fought under the American flag, and seen it folded and given to families of your friends, you are committed, as am I, to protecting the dignity of the flag and the Constitution of the United States," he said.

The president's address to the American Legion was sandwiched between two fund-raising events, the first in Minnesota, where he spoke at a $2,000 per plate Bush-Cheney '04 luncheon that was expected to raise $1.2 million. That brings the total for his re-election campaign to $55 million.

As usual, the president told supporters that winning the war on terrorism is essential.

"The enemies of freedom are not idle and neither are we," he told about 600 people at the St. Paul RiverCentre (search) who munched on corn-on-a-stick, chicken fingers and fried pickles. "In Afghanistan and Iraq, we gave ultimatums to terror regimes. Those regimes chose defiance, and those regimes are no more," he said.

The president was attending a second fund-raiser on Tuesday night, this time for the re-election campaign of four-term Sen. Kit Bond (search) of Missouri. Afterward, the president was flying back to the sweltering heat of his Texas ranch for the last few days of his vacation.

Fox News' Brian Wilson and The Associated Press contributed to this report.