WASHINGTON (AP) -- President Bush said Tuesday the nation's troubled financial system is "basically sound" and urged lawmakers to quickly enact legislation to prop up mortgage giants Fannie Mae and Freddie Mac. He also called on the Democratic-run Congress to follow his example and lift a ban on offshore drilling to help increase domestic oil production.

"I readily concede it won't produce a barrel of oil tomorrow, but it will reverse the psychology," Bush told a White House news conference -- his first since late April.

Bush said the two troubled mortgage companies play a central role in the nation's housing-finance system and that government action to help them were not bailouts because the two would remain shareholder-owned companies.

"I don't think the government ought to be involved in bailing out companies," Bush said.

Amid soaring gas prices, the toughest real estate market in decades, falling home prices and financing that's harder to come by, Bush said: "It's been a difficult time for many American families." But he also said that the nation's economy continues to grow, if slowly.

WASHINGTON (AP) -- The two major presidential rivals sharpened their long-standing dispute over the Iraq War on Tuesday, Democratic Sen. Barack Obama calling it a costly distraction that must end while Republican Sen. John McCain insisted it is a conflict the United States has to win.

"Iraq is not going to be a perfect place, and we don't have unlimited resources to try and make it one," Obama said in a speech in which he also said the United States must shift its focus to defeating the Taliban and al-Qaida in Afghanistan.

Rebutting swiftly, McCain said Obama "will tell you we can't win in Afghanistan without losing in Iraq. In fact, he has it exactly backwards."

While the two men agreed on the importance of prevailing in Afghanistan, the dispute veered in a new direction when it came to the tribal areas of next-door Pakistan, where terrorist Osama bin Laden and his men are thought to be hiding.

McCain accused Obama of "trying to sound tough" by speaking publicly of taking unilateral action against those blamed for the terror attacks of Sept. 11, 2001.

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