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Bush warns of Iraqi caliphate 

bushBy Steve Holland WASHINGTON (Reuters) - President Bush vowed on Tuesday to prevent al Qaeda from setting up a violent, radical Islamic empire based in Iraq, which he said was Osama bin Laden's ultimate goal.

"We know what the terrorists intend to do because they've told us -- and we need to take their words seriously," Bush said in a speech liberally laced with quotes from bin Laden, architect of the September 11 attacks five years ago which killed around 3,000 people

As he sought to bolster support ahead of November elections, Bush also released a White House national strategy for combating terrorism that said Americans are safer five years after the attacks but "we are not yet safe." Delaware Democratic Sen. Joe Biden said release of the new report showed that even the White House now acknowledged its previous strategy had failed. "The president has squandered the opportunity to unite the country and the world, instead he has divided both," he said.

White House officials denied Bush's speech and the report were driven by election politics. Recently, the president has returned to one of his time-tested themes, accusing Democrats of being soft on terrorism as he tries to help Republicans retain control of the U.S. Congress.

Addressing the Military Officers Association of America, Bush said Islamic radicals would like to obtain nuclear and other weapons of mass destruction in order to "blackmail the free world and spread their ideologies of hate."

"If we retreat from Iraq, if we don't uphold our duty to support those who are desirous to live in liberty 50 years from now, history will look back on our time with unforgiving clarity and demand to know why we did not act," Bush said."I'm not going to allow this to happen and no future American president can allow it either," he said.

Bush quoted extensively from bin Laden's videotaped messages and writings, comparing him to 20th century dictators like Russia's Vladimir Lenin and Germany's Adolf Hitler.

BIN LADEN LETTER He cited in particular a letter from bin Laden to the former Taliban ruler, Mullah Omar, that coalition forces found in Afghanistan in 2002. Bin Laden wrote that al Qaeda should launch a media campaign to tell Americans "their government would bring them more losses, in finances and in casualties," and that they are being sacrificed for big investors, "especially the Jews." Bush said al Qaeda's vision was to create a "unified totalitarian Islamic state that can confront and eventually destroy the free world.

" Bin Laden has declared Iraq "the capital of the caliphate," said Bush, who has often faced criticism for trying to tie Iraq into the broader "war on terrorism." Massachusetts Democratic Sen. John Kerry, the losing presidential candidate in 2004, responded that if Bush had killed bin Laden in late 2001, "he wouldn't have to quote this barbarian's words today."

 "Afghanistan is slipping back into chaos, Pakistan is one coup away from becoming a radical Islamic state with nuclear weapons, Iran is closer to a nuclear arsenal, and Iraq has become a recruitment poster for terror," Kerry said.Bush also repeated his contention that Iran was the world's most active state sponsor of international terrorism and must not be allowed to develop a nuclear weapon.

He said the international community had made a "reasonable offer" to Iran to give up its nuclear program. "We will continue to work closely with our allies to find a diplomatic solution, the world's free nation will not allow Iran to develop a nuclear weapon," Bush said. (Additional reporting by Tabassum Zakaria and Caren Bohan)Source Routers