Bush to Call Union Strong But in Need of Help on Economy, Uncontrolled Spending

WASHINGTON – President Bush will focus first on the economy in his final State of the Union address to the nation on Monday night, a speech that is to serve as a blueprint for his last year in office.

The House is set to take up a stimulus package quickly on Tuesday, and likely will pass it as a "suspension" bill, suggesting that it already has overwhelming support.

On Monday night, the president will press the Senate to wrap up an economic stimulus package quickly.

“To build a prosperous future, we must trust people with their own money and empower them to grow our economy. As we meet tonight, our economy is undergoing a period of uncertainty… And at kitchen tables across our country, there is concern about our economic future. In the long run, Americans can be confident about our economic growth,” Bush is expected to say, according to excerpts released ahead of the speech.

Watch FOX News and FOXNews.com for live coverage of President Bush's State of the Union address Monday night at 8:55 p.m. ET.

Though the White House and House leadership agreed on details of a $150 billion tax rebate and cuts program last week, some senators say they want to add elements like boosts to unemployment benefits and food stamps.

On spending, the president will announce his desire to eliminate or trim 151 programs the White House calls "wasteful or bloated," creating a savings of roughly $18 billion, aides say.

Bush will praise Congress for passing the No Child Left Behind act, his landmark education initiative, and to expand it to increase accountability, add flexibility for states and districts, reduce the number of high school dropouts and provide extra help for struggling schools.

Specifically, he will propose $300 million for children in struggling inner-city schools, which would be called "Pell Grants for Kids," named after the popular college grant program. If Congress approves, it would give money to families of poorer children so they could attend private or better public schools.

White House counselor Ed Gillespie told FOX News that the Pell Grants for Kids proposal will also help "save some of these schools that are closing their doors in the inner cities."

The federal government spent nearly 20 percent of the nation's gross domestic product last year, a large portion of which is mandatory spending on entitlements. Discretionary spending accounted for 7.6 percent of GDP.

While a small chunk of that money is in the form of congressional earmarks, or money set aside for lawmakers' pet projects, the president is going to say that earmarks undermine Americans' trust in the federal government.

As many as 95 percent of earmarks are inserted after Congress has voted and are never seen by most lawmakers. Bush called on Congress to cut the number in half during last year's State of the Union, but since then, analysts say, earmarks have increased.

"They enacted five times more earmarks than Bush is willing to tolerate, and they spent a whole lot more money on these things, and now he's saying, sort of pretty please, will you try and listen to me this year," said Mike Franc of the Heritage Foundation.

The president will pledge to veto any spending bill that does not cut earmarks in half, and will sign an executive order Tuesday directing federal agencies to ignore future earmarks that are not actually written into law and therefore circumvent the voting process. The only snag is that executive orders can be ignored by the next president, which may be why Democratic leaders on Monday seemed to dismiss the entire effort.

"It's a very sad thing to realize that the president of the United States — in his final State of the Union address — is not talking about the promise of the future, he's talking about the process of an appropriations bill. I think that's pretty sad," said House Speaker Nancy Pelosi.

"He's going to focus on earmarks, which shows how hard up he is for something to talk about," said Senate Majority Leader Harry Reid.

White House Chief of Staff Josh Bolten and Gillespie insist that the speech will be forward-looking, and countered Democrats by saying that the president's message is a lot more than an attempt to trip up Congress.

"We're keenly aware that the sands are running through the hourglass. But instead of discouraging this president and this White House, I think it's been energizing — and made us focus all the more on our jobs," Bolten said.

The speech "is going to highlight some new policies as well as some unfinished business, and hopefully we can get some things done before we get into the conventions and full-time campaign mode," Gillespie said.

Indeed, out on the 2008 presidential campaign trail, Democrats Hillary Clinton and Barack Obama, who will be in the House chamber for the speech, were already talking down the speech hours before its delivery.

"The president tonight will, as he has for the previous seven years, say that the State of our Union is strong, but with all due respect, Mr. President, come out on the road with me," Clinton said.

"This will be his last State of the Union speech. I suspect he may devote some time to try to explain his record," Obama said.

In fact, Bush will revisit issues that have dominated his two terms in office, including the Iraq war and a foreign policy that the administration hopes will result in a legacy known for its "freedom agenda."

"In the last seven years, we have witnessed stirring moments in the history of liberty," Bush is to say. "And these images of liberty have inspired us. In the past seven years, we have also seen images that have sobered us…[and] serve as a grim reminder: The advance of liberty is opposed by terrorists and extremists — evil men who despise freedom, despise America, and aim to subject millions to their violent rule."

The president will say that his opponents will continue to deny that the surge is working, "but among the terrorists there is no doubt — Al Qaeda is on the run in Iraq, and this enemy will be defeated."

Kansas Gov. Kathleen Sebelius is offering the Democratic response to the State of the Union. She is to suggest that Iraq was not worth the price.

"The last five years have cost us dearly -- in lives lost; in thousands of wounded warriors whose futures may never be the same; in challenges not met here at home because our resources were committed elsewhere. Americas foreign policy has left us with fewer allies and more enemies," read excerpts released by her office.

The president will say the surge that he initiated a year ago enabled the Iraqi people to stop worrying "that America was preparing to abandon them" and instead saw neighborhoods cleared of terrorists.

"While the enemy is still dangerous and more work remains, the American and Iraqi surges have achieved results few of us could have imagined just one year ago," he is to say.

The president will add that the coming year will be used "to sustain and build on the gains we made in 2007, while transitioning to the next phase of our strategy. American troops are shifting from leading operations, to partnering with Iraqi forces, and, eventually, to a protective overwatch mission."

The president will say that the "difficult work" must be done now so that "years from now people will look back and say that this generation rose to the moment, prevailed in a tough fight, and left behind a more hopeful region and a safer America."

On other foreign policy matters, Bush will call on Iran to verifiably suspend its nuclear enrichment so negotiations can begin for Iran to "rejoin the community of nations." The president will also note that energy security for America means finding alternatives to U.S. dependence on foreign oil.

The president will also press Congress to pass trade agreements with South Korea, Panama and Colombia and to complete an international agreement to reduce and eventually reverse the growth of greenhouse gases.

The president will also detail what improvements his administration is making on border security, while conceding any hopes of a comprehensive immigration reform bill this year.

But in his speech, Bush appears to hold out some hope of reconciliation between the parties.

"The actions of the 110th Congress will affect the security and prosperity of our nation long after this session has ended. In this election year, let us show our fellow Americans that we recognize our responsibilities and are determined to meet them. And let us show them that Republicans and Democrats can compete for votes and cooperate for results at the same time," he will say.

Sebelius too will try to take a conciliatory tone, suggesting that the parties need to work together during Bush's final year in office, but she also will suggest that the only way for the nation's goals to be met is through a Democratic-led Congress.

“There is a chance Mr. President, in the next 357 days, to get real results, and give the American people renewed optimism that their challenges are the top priority. Working together, working hard, committing to results, we can get the job done,” she says in excerpted remarks of her response.

“In fact, over the last year, the new Democratic majority in Congress has begun to move us in a new direction, with bipartisan action on significant initiatives to bolster our national security, raise the minimum wage, and reduce the costs of college loans.”

FOX News' Jim Angle and Bret Baier contributed to this report.