Bush: Decisions This Year Will Determine the Future of the U.S.

The future and character of the United States will be largely determined in the next year by getting over a longtime dependency on foreign oil, progress in Iraq, the growing threat from Iran and concerted efforts to take care of America's own, President Bush said Tuesday night during his fifth annual State of the Union address.

"We will choose to act confidently in pursuing the enemies of freedom or retreat from our duties in the hope of an easier life. We will choose to build our prosperity by leading the world economy — or shut ourselves off from trade and opportunity," the president told a joint session of Congress.

"In a complex and challenging time, the road of isolationism and protectionism may seem broad and inviting, yet it ends in danger and decline. The only way to protect our people, the only way to secure the peace, the only way to control our destiny is by our leadership."

But Bush said the partisan bickering that has threatened to boil over in recent months needs to end, particularly if the United States is to succeed in the War on Terror and in Iraq. Administration officials have criticized some Democrats for wanting to get out of Iraq when the going gets tough, saying it sends the wrong message to American troops, U.S. allies and Iraqis.

"Even tough debates can be conducted in a civil tone, and our differences cannot be allowed to harden into anger," Bush said. "There is a difference between responsible criticism that aims for success and defeatism that refuses to acknowledge anything but failure. Hindsight alone is not wisdom. And second-guessing is not a strategy."

Bush opened his address by paying tribune to Coretta Scott King, the widow of the Rev. Martin Luther King Jr., who died Monday night at the age of 78.

"We are comforted by the hope of a glad reunion with the husband who was taken from her so long ago, and we are grateful for the good life of Coretta Scott King," Bush said.

Energy was a top issue as Bush made the case that the nation must use technology to overcome its dependence on Mideast oil. Other topics included nuclear pursuits in Iran, conditions in Iraq, the election of the terror group Hamas to lead the Palestinian people and domestic concerns like health care, education and the economy.

The president also once again defended electronic eavesdropping conducted by the National Security Agency and called on Congress to ban human cloning and come up with a plan to stem illegal immigration.

As part of the president's attempt to reach out to foreign circles, the State Department used the Web to audio stream the address in multiple languages.

Tuesday's speech comes less than a week before Bush sends his budget request for 2007 to Congress, and will be followed by national travel in which he will tout his address initiatives. The president begins recapping his speech Wednesday in Nashville, Tenn., and will deliver major policy speeches to address his initiatives in Maplewood, Minn., Albuquerque, N.M., and Dallas.

It's customary for a Cabinet member, and one lawmaker from both parties and each chamber to be away from the congressional chamber in case a catastrophic event takes place. Veterans Affairs Secretary Jim Nicholson sat out the president's speech, as did Rep. Eric Cantor of Virginia, the GOP deputy whip, and Rep. George Miller of California, chairman of the House Democratic Policy Committee. Democratic Sen. Byron Dorgan of North Dakota and Republican Sen. Ted Stevens of Alaska were also absent.

'We Are Winning'

The president once again said the Sept. 11, 2001, terror attacks taught the United States that problems and oppression abroad can threaten people here at home. Although some may call that view "misguided idealism," Bush said, "in reality, the future security of America depends on" fighting tyranny. "Every step toward freedom in the world makes our country safer, and so we will act boldly in freedom's causes."

Bush touted a series of successes, including women voting in Afghanistan and millions of Iraqis going to the polls in December's parliamentary election. But radical Islam and terror leaders like Usama bin Laden threaten such success, he said, pointing to terror attacks like the London train bombings and Beslan school attack in Chechnya.

"No one can deny the success of freedom, but some men rage and fight against it … Lacking the military strength to challenge us directly, the terrorists have chosen the weapon of fear," Bush said. "But they have miscalculated; we love our freedom, and will fight to keep it."

Highlighting what many believe is the most severe threat emerging in the global community, Bush said Iran needs to stop sponsoring terrorists and give up its nuclear ambitions. Iran is "a nation now held hostage by a small clerical elite that is isolating and repressing its people," he said.

On Thursday, Mohammed El Baradei, head of the International Atomic Energy Agency, is issuing an update on Iran. This comes after an initial report was obtained by FOX News on Tuesday that shows Iran has been misleading the IAEA about its nuclear weapons pursuits.

The five members of the U.N. Security Council agreed on Monday that Iran's nuclear efforts are subject to scrutiny, though no action is expected to be taken until March. At the State of the Union, the president said the United States will continue to rally the world to the threat. He also voiced support for the Iranian people.

"We respect your right to choose your own future and win your own freedom. And our nation hopes one day to be the closest of friends with a free and democratic Iran," Bush said.

With the war in Iraq about to enter its fourth year and more than 2,240 American troops killed, Bush said the nation must not falter in what he considers the central front in the War on Terror. About 138,000 U.S. troops are in Iraq, down from about 160,000 at the time of the Dec. 15 Iraqi election. Despite the violence continuing in Iraq, the nation is on its way to self-governance, Bush said, and Iraqi security forces are slowly but surely taking control of their own country.

"In a time of testing, we cannot find security by abandoning our commitments and retreating within our borders. If we were to leave these vicious attackers alone, they would not leave us alone. They would simply move the battlefield to our own shores," Bush said. "I am confident in our plan for victory … fellow citizens, we are in this fight to win and we are winning."

Bush offered no timetable for troop withdrawal from Iraq and said he would take his cues from military commanders on the ground so far as how many troops are needed. And while saying he will be sure to ask for counsel from members of both parties on various issues, he made a dig at critics who say Iraq is a no-win situation.

"Members of Congress: however we feel about the decisions and debates of the past, our nation has only one option: We must keep our word, defeat our enemies and stand behind the American military in its vital mission," he said.

While Bush said the spread of democracy is vital to defeating what he calls an ideology of hate, no one-size-fits-all form of democracy exists. But that did not deter the president from criticizing the new Palestinian leadership — the terror group Hamas — elected in an overwhelming victory last week.

Bush called on Hamas to disarm, reject terrorism and recognize Israel. The United States has said Hamas must put down its weapons or it will not receive financial assistance; it has also encouraged other foreign leaders to cut off international aid.

Bush also said the United States cannot retreat into isolationism and must get involved in regions where corruption, poverty and despair breed terrorism and other crimes, as well as help impoverished countries with issues like AIDS.

"For people everywhere, the United States is a partner for a better life," Bush said. "Short-changing these efforts would increase the suffering and chaos of our world, undercut our long-term security and dull the conscience of our country."

Bush Defends NSA Wiretap Program

Bush has come under fire of late for his controversial NSA wiretapping program, which he authorized soon after the Sept. 11, 2001, attacks. It allows warrantless wiretaps to be used on some people inside the United States when communicating with suspected Al Qaeda members overseas. Some have questioned whether Bush overstepped his legal authority with his "terrorist surveillance program."

But Bush and other administration officials have repeatedly said the president's actions are legal and that Congress and the Constitution give him the authority, which also has been used by previous presidents.

"This terrorist surveillance program has helped prevent terrorist attacks," Bush said. "It remains essential to the security of America. If there are people inside our country who are talking with Al Qaeda, we want to know about it — because we will not sit back and wait to be hit again."

But to disrupt terror attacks at home and spread the ideals of freedom and democracy, the United States needs help from its friends and allies, Bush said, and it needs effective tools to fight terror. So he called on Congress to reauthorize the Patriot Act.

Congress this week will again extend parts of the act for six more weeks. The first extension will expire on Friday; that gave lawmakers a chance to come up with a compromise while preventing the four-year-old legislation from expiring altogether on Dec. 31.

Sen. Arlen Specter, R-Pa., chairman of the Senate Judiciary Committee, told FOX News he thinks the Senate "ought to fish or cut bait on the bill that's currently on the floor." He thinks the version passed out of a House-Senate conference and held up by Senate Democrats and four Republicans should be passed.

"It's a good bill, not a perfect bill," said Specter.

Priority Issues at Home

Strengthening America's economic leadership is a key priority for the president, who noted that in the last two-and-a-half years, the United States has created 4.6 million new jobs.

"The American economy is pre-eminent, but we cannot afford to be complacent. In a dynamic world economy, we are seeing new competitors like China and India," Bush said. "We must continue to lead the world in human talent and creativity."

Bush laid out what he called "a better path" than "economic retreat," which includes making his tax cuts, which he says put $880 billion into taxpayers' hands, permanent; passing a budget that cuts discretionary spending; eliminating more than 140 programs that are not performing up to par and cutting down on special interest projects.

"By passing these reforms, we will save the American taxpayer another $14 billion next year, and stay on track to cut the deficit in half by 2009," the president said.

Bush also made an attempt to revive his Social Security reform program by arguing that by 2030, spending for Social Security, Medicare and Medicaid will be almost 60 percent of the entire federal budget. He asked for a bipartisan congressional commission to be created that will examine the full impact of baby boom retirements on these programs,

"We need to put aside partisan politics, work together, and get this problem solved," he said.

Bush started his Social Security comments joking that "the first of about 78 million baby boomers turn 60," this year, including two of the first President Bush's favorite people "me, and President Bill Clinton." Bush then said Congress did not pass his reforms, which earned a standing ovation by Democrats. But the president wagged his finger at them in response and said: "Yet the rising cost of entitlements is a problem that is not going away, and with every year we fail to act the situation gets worse."

The president also pushed his guest worker program, which he said will give people temporary jobs while reducing smuggling and crime at the border. He rejected his critics' claims that this program is nothing short of amnesty for illegal aliens.

"Our nation needs orderly and secure borders. To meet this goal, we must have stronger immigration enforcement and border protection. And we must have a rational, humane guest worker program that rejects amnesty, allows temporary jobs for people who seek them legally and reduces smuggling and crime at the border."

Bush also bemoaned health care costs and promoted health saving accounts, the high-deductible health care plan that allows Americans to contribute money tax-free to 401(k)-like health savings plans, as well as greater tax deductions for out-of-pocket medical expenses.

"Our government has a responsibility to help provide health care for the poor and the elderly, and we are meeting that responsibility. For all Americans, we must confront the rising cost of care, strengthen the doctor-patient relationship and help people afford the insurance coverage they need," Bush said.

America 'Addicted to Oil'

Energy was a top issue Bush addressed as he made the case as to why the nation must use technology to overcome its dependence on Mideast oil. Oil prices closed Tuesday at nearly $68 per barrel, down slightly from Monday.

"America is addicted to oil, which is often imported from unstable parts of the world," Bush said. "The best way to break this addiction is through technology."

Since 2001, the United State has spent nearly $10 billion to develop cleaner, cheaper, more reliable energy sources. The overall goal is to replace more than 75 percent of U.S. oil imports from the Middle East by 2025.

"By applying the talent and technology of America, this country can dramatically improve our environment, move beyond a petroleum-based economy and make our dependence on Middle Eastern oil a thing of the past," Bush said.

The president outlined his plan for furthering alternative energy exploration and increasing America's brain trust, and proposed various ways to keep America competitive and to preserve what he considers the "culture of life." Those include:

—Increased federal research into alternative fuels such as ethanol made from weeds or wood chips instead of corn;

—Construction of new nuclear power plants, increased use of wind and solar power and clean coal technologies;

—The Advanced Energy Initiative, which includes a 22 percent increase in clean-energy research to change how Americans power homes, offices and automobiles;

—More investment in zero-emission, coal-fired plants, solar and wind technologies and clean, safe nuclear energy;

—An American Competitiveness Initiative to encourage innovation and the study of math and science;

—Job training for 70,000 advanced placement math and science teachers and 30,000 professionals in those areas into the classroom;

—A doubling of federal funds to research programs in nanotechnology, supercomputing and alternative energy sources over the next 10 years;

—Making permanent the research and development tax credit to encourage more private-sector investment in technology;

— Reauthorization of the Ryan White Act to provide new funding to states to fight AIDS;

—Prohibition of human cloning in all forms, whether it be creating or implanting embryonic stem cells for research or trafficking human embryos for this purpose.

"Human life is a gift from our Creator, and that gift should never be discarded, devalued, or put up for sale," Bush said.

On the official retirement day of Associate Justice Sandra Day O'Connor, Bush also thanked the Senate for confirming new U.S. Chief Justice John Robert and Justice Samuel Alito to the Supreme Court and said he will continue to nominate men and women "who understand that judges must be servants of the law, and not legislate from the bench."

Asked after the speech how it felt to be sitting with his fellow justices, Alito, who was confirmed and sworn in earlier in the day, smiled and said, "Very nice."

The administration has been criticized for ignoring many domestic issues, including the ravaged Gulf Coast — particularly New Orleans — after Hurricane Katrina roared ashore last August.

Bush noted that the federal government has committed $85 billion in aid to the Gulf Coast and addressed the underlying racial tensions that surfaced as many of those who could not evacuate ahead of the storm were black and poor, saying the key to fixing that is better education and access to housing and jobs.

"In New Orleans and in other places, may of our fellow citizens have felt excluded from the promise of our country," he said. "As we recover from a disaster, let us also work for the day when all Americans are protected by justice, equal in hope and rich in opportunity."

Through these efforts on both the domestic and international front, the president vowed, the United States will make its mark as a leader in a "period of consequence."

"We have entered a great ideological conflict we did nothing to invite. We see great changes in science and commerce that will influence all our lives. And sometimes it can seem that history is turning in a wide arc, toward an unknown shore," Bush said.

"Yet the destination of history is determined by human action, and every great movement in history comes to a point of choosing," he continued. "Before history is written down in books, it is written in courage. Like Americans before us, we will show that courage and we will finish well."

Democrats: 'There's a Better Way'

Democrats say the president has been absent on energy issues. Earlier in the day, House Minority Leader Nancy Pelosi re-released a Democratic policy initiative to note that energy independence has long been a Democratic goal.

The Innovation Agenda calls for the United States to "achieve energy independence in 10 years by developing emerging technologies for clean and sustainable alternatives that will strengthen national security and protect the environment."

"We believe we should be spending our energy dollars in the Midwest, not the Middle East," Pelosi said. "President Bush and his oil and gas company cronies simply don't have credibility on this issue. Where have the Republicans been the last five years?"

"The Republican Party is addicted to big oil money," added Rep. Rahm Emanuel of Illinois, chairman of the House Democratic campaign organization. "That's why they gave them $14.5 billion in taxpayer subsidies while cutting $14 billion in student aid for kids going to college."

Virginia Gov. Timothy Kaine delivered Democrats' State of the Union response and said Bush is not leading the nation properly when it comes to the War on Terror.

"While the images of the World Trade Center are seared in the minds of all Americans, so too are the memories of those who died on sacred ground in Virginia in the attack on the Pentagon. Our commitment to winning the war on terrorism compels us to ask this question: Are the president's policies the best way to win this war?" Kaine said.

He also talked about the affects of the Iraq war on the National Guard in Virginia and the effects of cuts on the Guard.

"We now know that the American people where given inaccurate information about the reasons for invading Iraq. We now know that our troops in Iraq were not given the best body armor or the best intelligence. We now know that the administration wants to cut tens of thousands of troops from the Army and National Guard and Reserves at the very time America is facing new and dangerous threats. And we now know the administration wants to further reduce military and veterans' benefits. There's a better way," he added.

Los Angeles Mayor Antonio Villaraigosa, who gave the Democrats' response in Spanish, said his party had hoped to hear more ways in which Bush plans to bring the country together.

"Instead, we heard the same defense of the very policies that have divided this country over the last five years," Villaraigosa said, adding that the "reckless policies" of the Bush administration have led to an $8.2 trillion national debt, not enough access to health insurance and declining quality in the nation's public schools, among others.

FOXNews.com's Sharon Kehnemui Liss contributed to this report.