President Bush held a wide-ranging news conference in Washington at which he said he wants to increase the size of the U.S. military, which has been strained by operations in Iraq.
Summing up a year of setbacks, President Bush conceded that insurgents in Iraq thwarted U.S. efforts at "establishing security and stability throughout the country."
On the domestic front, the president said he saw an opening for compromise with the Democratic-controlled Congress that convenes on Jan. 4.
He cited Social Security and immigration as two major areas in which common ground might be found. He also called for fresh efforts to reduce the United States' dependence on foreign oil.
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