President Bush (search) said U.S.-led forces were "making progress" in Iraq where Marines were engaged in fierce battles with followers of a radical cleric holed up in the holy city of Najaf.

"We talked about Iraq, moving forward in Iraq (search)," and helping the Iraqis secure the nation as it approaches elections, Bush said here after mapping defense strategy for more than three hours with top national security officials. "We're making progress on the ground."

Bush emerged in shirt sleeves and boots from his meeting at a small house on his ranch, telling reporters that he and his advisers also discussed how to position troops around the world and intelligence reform.

Sen. Pat Roberts, R-Kan., on Sunday offered the most sweeping reorganization proposal by anyone since the commission that investigated the Sept. ll, 2001, attacks. He called for major changes, including transferring control of the nation's major intelligence gathering from the CIA (search) and the Pentagon to a new national intelligence director (search).

Bush said he hadn't seen Roberts' proposal, but would review it. But he added: "There's a lot of ideas moving around. And we've got a lot of smart people looking at the best way to fashion intelligence so that the president and his Cabinet secretaries have got the ability to make good judgment calls on behalf of the American people."

He said that while he has called for the creation of a national intelligence director, he's not in favor of "anything standing in between me and my line operators like the secretary of defense."

"In other words, once intelligence is in place and once we come up with a decision as to how to act, I want to make sure the person responsible for the actions has a direct report to me," he said.

Vice President Dick Cheney, Defense Secretary Donald H. Rumsfeld, Joint Chiefs of Staff Chairman Gen. Richard Myers and national security adviser Condoleezza Rice were among those who attended the defense policy meeting at the president's ranch. Gen. George Casey, the senior U.S. officer in Iraq, and Gen. John Abizaid, head of the U.S. Central Command, participated in part of the meeting via a secure video conference.

"We talked about transformation issues, spent some time talking about the reconfiguration of our forces around the world to better ... keep the peace," Bush said.

Bush's fourth annual meeting on defense priorities took place at the ranch where the president is spending a week preparing for next week's Republican National Convention in New York.

Asked about his acceptance speech and whether he was worried about violent protests at the convention, Bush said: "You know, I want them to express themselves in democracies and hopefully they'll do so in a peaceful way."

Failing to offer tidbits on the content of his speech, Bush said, "In terms of the speech, I'm working on it."