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Intel Report Pessimistic About Iraq's Future

A classified National Intelligence Estimate (search) prepared for President Bush in late July contains bleak forecasts for Iraq, which experts said could remain in a tenuous political and security situation for the unforeseen future, FOX News has confirmed.

The estimate outlines three possibilities for Iraq through the end of 2005, with the worst case scenario being developments that could lead to civil war, government officials said Wednesday.

The document lays out a second scenario in which increased extremism and fragmentation in Iraqi society impede efforts to build a central government and adversely affect efforts to democratize the country.

In a third, worst-case scenario, the intelligence council contemplated "trend lines that would point to a civil war," a government official said. The potential conflict could be among the country's three main populations -- the Sunnis, Shiites and Kurds.

It "would be fair" to call the document "pessimistic," the official added. But "the contents shouldn't come as a particular surprise to anyone who is following developments in Iraq. It encapsulates trends that are clearly apparent."

The National Intelligence Council (search), which prepared the report, looked at the political, economic and security situation in the war-torn country.

The document was first reported by The New York Times on its Web site Wednesday night. FOX News has confirmed the contents of that report.

"It states the obvious. It talks about the challenges we face and that's what intelligence reports are supposed to do," White House spokesman Scott McClellan told reporters on Thursday. "The role of the CIA is to look at those issues. The role of decision-makers is to work to address those challenges."

In a conference call arranged by the John Kerry presidential campaign, Sen. Bob Graham, D-Fla., called on the White House to release the new assessment. "The American people need to know the truth," he said Thursday.

The intelligence estimate considered the window of time between July and the end of 2005. But the official noted that the document draws on intelligence community assessments from January 2003, before the U.S.-led invasion of Iraq and the subsequent deteriorating security situation there.

The council is a group of senior intelligence officials who provide long-term strategic thinking for the entire U.S. intelligence community.

Acting CIA Director John McLaughlin (search) and the leaders of the other intelligence agencies approved the intelligence document, which runs about 50 pages.

The estimate appears to differ from the public comments of Bush and his senior aides, who speak more optimistically about the prospects for a peaceful and free Iraq.

"We're making progress on the ground," Bush said at his Texas ranch late last month.

White House spokesman Scott McClellan also said Wednesday that progress was being made.

"You know, every step of the way in Iraq there have been pessimists and hand-wringers who said it can't be done," McClellan said at a news briefing. "And every step of the way, the Iraqi leadership and the Iraqi people have proven them wrong because they are determined to have a free and peaceful future."

Bush's Democratic presidential opponent, John Kerry, called in to MSNBC's "Imus in the Morning" radio show Wednesday and expressed his own doubts about how well the democratic process was going in that country and whether elections could actually be held in January.

"I think it is very difficult to see today how you're going to distribute ballots in places like Fallujah, and Ramadi and Najaf and other parts of the country, without having established the security," Kerry said. "I know that the people who are supposed to run that election believe that they need a longer period of time and greater security before they can even begin to do it, and they just can't do it at this point in time. So I'm not sure the president is being honest with the American people about that situation either at this point.''

A CIA spokesman declined to comment Wednesday night.

It is the first formal assessment of Iraq since the October 2002 National Intelligence Estimate on the threat posed by fallen Iraqi President Saddam Hussein.

A scathing review of that estimate released this summer by the Senate Intelligence Committee found widespread intelligence failures that led to faulty assumptions that Iraq had weapons of mass destruction.

Disclosure of the new National Intelligence Estimate on Iraq came the same day that Senate Republicans and Democrats denounced the Bush administration's slow progress in rebuilding Iraq, saying the risks of failure are great if it doesn't act with greater urgency.

"It's beyond pitiful, it's beyond embarrassing, it's now in the zone of dangerous," said Sen. Chuck Hagel, R-Neb., referring to figures showing only about 6 percent of the reconstruction money approved by Congress last year has been spent.

Senate Foreign Relations Committee members vented their frustrations at a hearing during which State Department officials explained the administration's request to divert $3.46 billion in reconstruction funds to security and economic development. The money was part of the $18.4 billion approved by Congress last year, mostly for public works projects.

The request comes as heavy fighting continues between U.S.-led forces and Iraqi insurgents, endangering prospects for elections scheduled for January.

"We know that the provision of adequate security up front is requisite to rapid progress on all other fronts," Deputy Assistant Secretary of State Ron Schlicher said.

McClellan said circumstances in Iraq have changed since last year. "It's important that you have some flexibility."

Hagel, Committee Chairman Richard Lugar, R-Ind., and other committee members have long argued — even before the war — that administration plans for rebuilding Iraq were inadequate and based on overly optimistic assumptions that Americans would be greeted as liberators.

But the criticism from the panel's top Republicans had an extra sting, coming less than seven weeks before the U.S. presidential election in which Bush's handling of the war is a top issue.

"Our committee heard blindly optimistic people from the administration prior to the war and people outside the administration — what I call the 'dancing in the street crowd' — [who said] that we just simply will be greeted with open arms," Lugar said. "The nonsense of all of that is apparent. The lack of planning is apparent."

He said the need to shift the reconstruction funds was clear in July, but the administration was slow to make the request.

State Department officials stressed areas of progress in Iraq since the United States turned over political control there to an interim government on June 28. They cited advances in generating electricity, producing oil and creating jobs.

FOX News' Bret Baier and The Associated Press contributed to this report.