Bush cited the Iraqi forces' response to the February 22 bombing of the Shi'ite mosque in Samarra, which led to clashes between the country's Shi'as and Sunnis that have left hundreds dead.
Bush acknowledged that some of these militias may need more training, and some units performed better than others during the recent crisis, but he said he expects they will soon be reliable security forces.
"As more capable Iraqi police and soldiers come on line, they will assume responsibility for more territory, with the goal of having Iraqis control more territory than the coalition by the end of 2006. And as Iraqis take over more territory, this frees American and coalition forces to concentrate on training and on hunting down high-value targets like the terrorist [Abu Musab] Zarqawi and his associates."
Bush also urged the American people to be patient, saying Iraq's move from a dictatorship to democracy is bound to be difficult, especially because of armed resistance from loyalists of deposed President Saddam Hussein and members of Al-Qaeda in Iraq, led by Zarqawi, who oppose a U.S.-inspired form of government.
And he called on the Iraqis to be more willing to compromise as they set up a government made up of Shi'as, Sunnis and Kurds that can stabilize the country and end the bloodshed.
"I wish I could tell you that the violence is [decreasing] and that the road ahead will be smooth. It will not. There will be more tough fighting and more days of struggle, and we will see more images of chaos and carnage in the days and months to come. The terrorists are losing on the field of battle, so they are fighting this war through the pictures we see on television and in the newspapers every day. They are hoping to shake our resolve and force us to retreat. They are not going to succeed."
The speech comes as Bush's approval ratings have dipped to their lowest level over, according to recent public opinion polls. They show that less than 40 percent of those surveyed support the war, and a vast majority -- around 80 percent -- believe Iraq is on the brink of civil war.
The Katrina Effect
Bush needs to do something to salvage his credibility with the American people, according to Patrick Basham, the founding director of the Democracy Institute, a Washington policy research center.
Basham says Bush and his top advisers look at the declining polls and see that in the opinion of the American people, it is losing the debate on Iraq.
"The White House must re-center that debate and remind people why it was necessary to go in [to Iraq], what it is that is happening over there that is positive -- that it's not all bad -- and, I think critically, to explain what comes next, what the president is doing to address the obvious problems which are now belatedly being acknowledged by the White House."
Basham acknowledges that this is a big challenge, but in the past, he says, Bush has been successful at regaining support. This time, he says, the president must convince those people who once supported his Iraq policy, or at least gave him the benefit of the doubt, but who now feel betrayed by the president.
According to Basham, many Americans supported Bush on Iraq until about six months ago. He says the turning point was something that had nothing to do with the war: Hurricane Katrina, which caused unprecedented damage to areas of the U.S. Gulf of Mexico coast, including the culturally important city of New Orleans.
Basham says the Bush administration's faltering response to the storm caused people to take a closer look to the White House's performance elsewhere, including Iraq. What they've seen, he says, wasn't flattering to Bush.
"Katrina really cut the legs off from underneath the Bush White House. The president himself is no longer automatically trusted to know what the right thing is to do and to be able to execute when necessary. Not only has it weakened the president in his domestic agenda, but it has taken the gloss off the national security and foreign policy agenda."
Basham says restoring that gloss will be difficult because too many Americans are no longer giving the Bush administration the benefit of the doubt.