Bush's Last Plea - $150bn to Save Economy

George Bush, overshadowed in the final year of his presidency by the race to choose his successor, used his final State of the Union address last night to press Congress to act on the economy.

With 51 weeks left in his presidency, and a personal approval rating in the low 30s, the night was one of Bush's few remaining moments in the national spotlight. But he had to share the evening with two of his would-be successors: Hillary Clinton and Barack Obama were among the senators in attendance.

Mindful of his waning presidency, Bush made no attempt at the new visions that are typically unveiled in the annual address. The speech, which divided fairly evenly between his domestic and foreign agenda, also avoided a full review of the last seven years.

Instead, Bush attempted to use his diminishing political capital to allay anxiety about the economy, which has replaced the Iraq war as the issue of most concern to Americans.

He also tried to shift the blame for the failings of his presidency on a Democratic Congress. The centerpiece of last night's address was an appeal to Congress to pass a $150bn (£75bn) economic stimulus package that would give tax rebates to families. "To build a prosperous future, we must trust people with their own money and empower them to grow our economy," he said according to prepared remarks released ahead of delivery.

"Our economy is undergoing a period of uncertainty... And at kitchen tables across our country, there is concern about our economic future."

But he moved from his somewhat conciliatory tone on the economic stimulus plan, which has some support in Congress, to attack public spending on special interest or local projects, known as earmarks.

Bush also used the address to try to tie up what his officials called "unfinished business" of his presidency: the tax cuts of his first term, which will expire in 2010, and legislation on wire taps without court oversight. That law expires on Friday and Congress has balked at demands from the White House to grant legal immunity to telephone companies involved in the surveillance.

On the Iraq war, the speech was the first State of the Union for four years in which Bush could claim success. But he spoke after five soldiers were killed by a roadside bomb in the northern city of Mosul yesterday during an offensive against suspected al-Qaida militants.

Nevertheless, Bush reminded Americans of the gains achieved during the past year since he sent an additional 27,000 troops to Iraq. "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 said. "Some may deny the surge is working, but among the terrorists there is no doubt."

Those troops are scheduled for withdrawal by this summer and the Pentagon is also hoping for further troop reductions in Iraq to ease the strain. But the president gave no indication last night of further troop cuts.

Bush's prepared speech also included a stern warning to Iran. "America will confront those who threaten our troops, we will stand by our allies, and we will defend our vital interests in the Persian Gulf," he said.

In many ways, the speech was a reminder of the failures of the Bush presidency. The ambitious domestic agenda unveiled in previous State of the Union addresses failed to get off the ground as Bush acknowledged himself last night.

He also called on Congress to solve another failure of his presidency on domestic policy: immigration reform. "Illegal immigration is complicated, but it can be resolved. And it must be resolved in a way that upholds both our laws and our highest ideals," he said.