More good things are happening in Iraq than what is portrayed in the media, President Bush said Wednesday, and the United States will ensure that the security, political and economic elements for the fledgling democracy are in place before American troops will pull out.

"This is a quiet, steady progress, it doesn't always make the headlines of the evening news but it's real and it's important and it's unmistakably clear to those who see it close up," Bush said.

On the 64th anniversary of the attack on Pearl Harbor, the president said the fight America had to launch in 1941 is similar to the War on Terror it finds itself in now.

"The strike on Pearl Harbor was the start of a long war for America, a massive struggle against those who attacked us and those who shared their destructive ambitions," Bush said during a speech at the Council on Foreign Relations in Washington. "Our nation pulled together and despite setbacks and battlefield defeats, we did not waver in freedom's cause."

On Sept. 11, 2001, "our nation woke to another attack. In just 102 minutes, more Americans were killed than we lost in Pearl Harbor," he added.

Bush's remarks were the second in a series designed to defend the war and outline progress in Iraq. During the president's first speech on the topic one week ago, Bush gave a more detailed plan of progress being made in the security and political arenas. On Wednesday, he focused more on the economic aspects, stressing that the United States and coalition forces are helping Iraqis rebuild after decades of neglect under Saddam Hussein's rule and more recent fighting by insurgents and terrorists.

"Iraqis are beginning to see that a free life means a good life. Reconstruction efforts have not always gone as good as we hope," Bush said, noting that rebuilding a nation takes time, and it's even harder when those opposing progress are "trying to blow up what the Iraqis are trying to build."

Bush said that in the past two years nearly 3,000 school renovation projects have been completed; more than 30,000 school teachers have been trained; 8 million textbooks have been distributed; drinking water has been improved for more than 3 million people; the Iraq stock exchange has been reopened; $21 million in microcredit and small business loans have been given to Iraqi entrepreneurs; and more than 30,000 new Iraqi businesses have registered since the country was liberated from Saddam.

"This economic development and growth will be really important to addressing that high unemployment rate across much of that country," Bush said. "Iraq's market-based reforms are gradually returning that proud country to the global economy."

But the president continued to stress the importance of remembering that Iraq is the central front in the War on Terror, and that it's vital the coalition succeed there and build up a democratic government in order to create a more stable Middle East. Just like challenges the United States faced in World War II, challenges in Iraq do not mean it's time to cut and run, he said.

"Like generations before us, we face setbacks on the paths to victory. Yet we will fight this war without wavering and like the generation before us, we will prevail," Bush said. "Like earlier struggles for freedom, this war will take many turns and the enemy must be fought on every battlefront."

Security in Iraq has posed the biggest obstacle to faster economic and infrastructure progress being made, Bush noted.

Progress in Najaf, Mosul

Bush cited Najaf and Mosul — once the sites of some of the bloodiest battles of the war — as two cities where progress is being made, giving Iraqis more of a stake in their country's future.

Bush talked about reconstruction projects and the reopening of schools, markets and hospitals; the upgrading of roads and the growth of construction jobs in the two cities. The president acknowledged that both cities still face challenges of quashing violent "militias" aimed at undermining projects.

Najaf, home of one of the holiest sites for Shiite Muslims, suffered greatly under Saddam, Bush said, and after coalition troops liberated the city in 2003, a year later it fell under the sway of violent militias who fought in support of firebrand cleric Muqtada al-Sadr. Fighting led to homes and businesses being damaged and dissuaded visitors and pilgrims to the city.

But when the militias were routed, Najaf began to blossom, the president said, quoting one Najaf resident by saying: "Three years ago, we were in ruins, one year ago we were fighting in the streets, now look at us — shopping and eating."

Although there's still plenty of work to be done in Najaf and around Iraq, and reconstruction has been full of "fits and starts" in terms of sustained electricity and making sure the influence of armed gangs is reduced, Bush said progress in Najaf includes:

— Rebuilding of the local police force with the help of the U.S. Agency for International Development, Najaf's governor and other local officials;

— Repair of schools and homes and the rebuilding of a soccer stadium;

— Restoration of clean drinking water;

— The opening of new businesses and markets even in some of the poorest areas;

— Visits by religious pilgrims;

— Creation of construction jobs that are putting people back to work;

— Return of the Najaf Teaching Hospital, which was looted and used as a military fortress by militias and is now open to serve hundreds of patients each day.

"Najaf is now in the hands of elected government officials, and elected provincial officials are at work," Bush said, adding that U.S. forces are 40 minutes outside the city and only go into Najaf when called.

"They have no intention of returning to the days of tyranny and terror," the president said of the residents in Najaf.

Mosul, a diverse city full of Sunni Arabs, Kurds and others, is where Saddam's sons were killed by coalition forces in the summer of 2003. By late last year, insurgents and Saddamists had taken over the city, Bush said. After they were cleared out by Iraqi and U.S. forces, Iraqis took control of security for the city. U.S. forces only act in a reinforcing role, he said.

Progress in Mosul includes:

— Rebuilding of a key road over the Tigris River;

— Reconstruction of police stations and firehouses;

— Development of water and sewage treatment plants;

— Construction of a new and improved electric substation;

— Strong calls for participation in and heavy campaigning ahead of next week's election.

The president noted that just last week Iraqis hanging election posters were attacked and killed. But "freedom is taking hold in Mosul and Iraqis are making their voices heard," he said.

"In places like Najaf and Mosul, residents are seeing tangible progress in their lives ... their confidence in Iraq's democracy is growing," Bush said. "The progress of these cities is being replicated across much of Iraq, and more of Iraq's people are seeing the real benefits that a democratic society can bring."

Corruption continues to be a problem, Bush acknowledged, and it's being dealt with. The American embassy in Baghdad is demanding more transparency in the investment of reconstruction money. A commission on public integrity, as well as an auditing board, are also being established.

"Corruption is a problem at both the national and local levels of government. We will not tolerate fraud," Bush said. "The Iraqi people expect money to be spent openly and honestly and so do the American people."

Ignoring the 'Pessimists'

Senate Democrats issued a report Wednesday saying the United States faces a reconstruction gap in Iraq. "The simple fact is that basic needs — jobs, essential services, health care — remain unmet," according to the report obtained by the Associated Press.

Several Democrats sent Bush a letter saying his speech should include "a full and complete strategy for success with the political, economic and military benchmarks by which to measure the progress."

"Just because he says things are improving there, doesn't make it so," House Minority Leader Nancy Pelosi, D-Calif., said. "The president says the security situation on the ground is better. It is not ... More of the same in Iraq is not making us safer."

Pelosi and other Democratic leaders have tried to project a unified front on the war, even though they disagree over just when U.S. troops should return home. Some, such as Sen. Joseph Lieberman of Connecticut, agree that the troops cannot be pulled out now, else Iraq will become another Afghanistan.

Bush said Wednesday that he's not listening to Democrats who are just criticizing the war with no proposed solutions, nor is he listening to those calling for "artificial timetables" for troop withdrawal. At Fort Drum, N.Y., on Tuesday, Vice President Dick Cheney also He rejected calls for a speedy drawdown of troops.

"I reject the pessimists in Washington who say we can't win this war, yet every day we can be confident of the outcome because we know that freedom has got the power to overcome terror and tyranny," he said."When victory is achieved, our troops will then come home with the honor they've earned."

Bush and other administration officials are working to shore up waning public support for the war in the run-up to the Dec. 15 vote in Iraq to create a democratically elected government.

One week ago, the administration released a 35-page booklet titled "Our National Strategy for Victory in Iraq" to coincide with the president's speech at the U.S. Naval Academy. According to that document, oil production increased last year to 2.25 million barrels a day from an average of 1.58 million barrels a day the year before.

Some Iraqi analysts in Washington say, however, it's misleading to use the 2003 figure of 1.58 million barrels because Iraqi oil production was dramatically curtailed that year, when coalition forces first entered Iraq. Analysts say they favor using a baseline figure of about 2 million barrels a day, which means oil production, curbed by decaying infrastructure and frequent militant attacks on pipelines and refineries, has remained flat.

The Associated Press contributed to this report.