(CBS) The Pentagon said Tuesday it was closing a new office opened late last year to project a favorable view of U.S. military activity abroad after media reports that it may be used to spread disinformation.

Defense Secretary Donald H. Rumsfeld said the Office of Strategic Influence would not have spread false stories but that news reports and commentary have made it impossible for the agency to do its job.

"While much of the thrust of the criticism and the cartoons and comment has been off the mark," Rumsfeld told reporters, "the office has been damaged so much that it could not operate effectively."

Asked if the Pentagon's credibility had been damaged, Rumseld said, "I doubt it. I hope not. If it has, we'll rebuild it."

The Defense Department created the office after the Sept. 11 terrorist attacks. Rumsfeld said the office was supposed to help get the United States' side of the story out to counter the views of opponents such as the Taliban and the al Qaeda terrorist network.

Last week, reports surfaced that the office had proposed giving false information to foreign journalists as a means of furthering the U.S. war against terrorism.

The New York Times reported that the office, headed by Air Force Brig. Gen. Simon P. Worden, had begun circulating classified proposals calling for using the Internet and clandestine operations to spread such disinformation.

Rumsfeld said the Pentagon has not spread lies and would never do so in the future. President Bush pledged on Monday that "we'll tell the American people the truth."

The Pentagon will continue trying to get its message across overseas, just not through the Office of Strategic Influence, Rumsfeld said.

"The office is done. What do you want, blood?" he said at a Pentagon news conference.

Rumsfeld said last week that the Pentagon might engage in what he called strategic or tactical deception, as it has in the past. For example, if U.S. troops were about to launch an attack from the west, they might "do things" that would make the enemy believe an attack was instead coming from the north, Rumsfeld said.

Douglas Feith, the undersecretary of defense who oversaw the now-closed office, had said he created the bureau to oversee all of the military's "information operations," such as dropping leaflets and broadcasting radio messages in battlefield areas.

Rumsfeld said he met with Feith Tuesday morning and Feith said he decided to close the office.