WASHINGTON — President Bush told the American people Monday night that his strategy to stabilize Iraq is achieving results “few of us could have imagined just one year ago,” even as he sought to reassure the public that his new stimulus plan will stave off the recession that threatens to overtake the nation’s economy during the final year of his presidency.

Appearing before Congress for his seventh and last State of the Union address, Bush claimed vindication for his controversial decision a year ago to send a “surge” of about 30,000 additional troops to Iraq. “The enemy is still dangerous and more work remains,” Bush acknowledged, but with high-profile attacks, sectarian violence and civilian deaths falling, he said progress is unmistakable.

“Some may deny the surge is working,” Bush said, “but among the terrorists there is no doubt. Al-Qaida is on the run in Iraq, and this enemy will be defeated.”

Bush made clear he is not ready to accelerate a drawdown of U.S. forces, which are scheduled to return to pre-“surge” levels of 130,000 by midsummer. He cited a warning from Gen. David Petraeus, the top U.S. commander in Iraq, that pulling troops out too quickly risks the recovery of al-Qaida in Iraq and an increase in violence.

“Members of Congress,” he implored, “Having come so far and achieved so much, we must not allow this to happen.”

Mixed economic picture

Bush’s address highlighted the shifting priorities of an administration that had planned to focus its final year on the war and other international challenges, but has found itself moving quickly in the past month to address the burgeoning crisis in the economy. The past year has brought a growing tide of bad economic news for the Bush administration, culminating in last week’s global stock market panic over a collapsing housing market and other financial woes in the United States.

The president called on Congress to finish work quickly on a $150 billion stimulus package, urging lawmakers not to “load up” the initiative with measures beyond the tax rebates and business incentives he agreed to last week with House leaders. “That would delay it or derail it, and neither option is acceptable,” Bush said.

On the economy, Bush painted a mixed picture. “In the short run, we can all see that growth is slowing,” he said. “America has added jobs for a record 52 straight months, but jobs are now growing at a slower pace. Wages are up, but so are prices for food and gas. Exports are rising, but the housing market has declined.”

Modest domestic plans

The president did not seek to revive the kind of ambitious social reforms that animated his past State of the Union addresses, such as proposals to create private accounts for Social Security or provide a pathway to citizenship for illegal immigrants. Instead, he offered a mixture of familiar initiatives, mixed in with modest new proposals on education, social services and assistance for military families, that his aides said stand a reasonable chance of approval before this summer’s political conventions start in late August.

Even as he struck a bipartisan tone, Bush made clear to the Democrats sitting before him that he intends to employ fully the powers of the presidency until his final hours in office. Bush said he will use his veto pen and administrative powers to try to rein in the proliferation of “earmarks,” the projects inserted by lawmakers into annual spending bills and totaling roughly $17 billion in the last budget.

Democrats respond

Democrats chose Kansas Gov. Kathleen Sebelius to respond to Bush’s address with a note of conciliation. “In this time, normally reserved for the partisan response, I hope to offer you something more: an American response,” Sebelius said.

While she described the economic stimulus package as only a “temporary fix,” she added, “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.”

Sebelius repeated “let’s get to work” throughout her response.

State of the Union highlights

ECONOMY

n Prod Congress to adopt $150 billion economic stimulus package of tax rebates for an estimated 117 million families and tax breaks for businesses.

n Ask for first-term tax cuts to be made permanent. They are set to expire in 2010.

SPENDING

n Promise to veto any spending bill that doesn’t cut the number and cost of congressional pet projects, known as earmarks, in half.

n Pledge to sign an executive order directing federal agencies to ignore earmarks that are tucked into “report” language instead of being spelled out in law.

FOREIGN POLICY

n Offer support for U.S.-backed Mideast peace process, with goal of a deal between Israelis and Palestinians by end of his presidency.

n Reiterate his call for Congress to double U.S. money for the global fight against HIV/AIDS, from $15 billion to $30 billion over the next five years.

n Warn leaders of Iran that the United States will confront those who threaten its troops and will defend its interests in the Persian Gulf.

EDUCATION

n Push for renewal of his No Child Left Behind Act, the education law that requires more student testing and sanctions for schools that fall short.

n Call for a $300 million initiative to let poor students in struggling schools transfer to private school or a public school outside their district.

TERRORISM

n Push Congress to permanently extend anti-terrorism law set to expire Friday. It governs how U.S. intelligence agencies can carry out surveillance of phone calls and e-mails involving people inside the United States.

MILITARY

n Propose hiring preferences across the federal government for spouses of nation’s veterans, as the veterans themselves now have.

n Ask Congress to allow service members of every military branch to transfer their unused G.I. education benefits to their spouses or children.

Associated Press