"We are in a very intense period as we come up on the Dec. 15 deadline" for the Iraqi Governing Council to set a timetable for writing a new constitution and holding democratic elections in Iraq, said L. Paul Bremer.
He spoke outside the White House after urgent talks with Mr. Bush and Vice President Dick Cheney at a National Security Council meeting along with Defense Secretary Donald H. Rumsfeld, Secretary of State Colin Powell and National Security Adviser Condoleezza Rice.
"We have been moving forward on ways to continue to transfer authority to the Iraqis as they are ready for it," Bremer said. "They have made a lot of progress on that. I have made proposals to transfer more authority to the Iraqi Governing Council and that is the backdrop for all of these discussions."
The administration's new political strategy amounts to a change in policy, reports CBS News White House Correspondent Mark Knoller. With bloodshed continuing to mount, the U.S. wants to send a clear signal that it wants to give the Iraqis more political power more quickly.
The urgency of the White House talks was underscored by a top-secret intelligence report which government officials said warned that Iraqis are losing faith in the U.S.-led occupation forces.
Bremer dodged questions about the report. "I think the situation with the Iraqi public is frankly not easy to quantify," he said. "We've looked at polls. We've talked to people. Obviously the terrorists are trying to encourage the Iraqi people to believe that the United States is not going to stay the course. They've killed mostly Iraqis."
At the State Department, Powell said negative reports about Iraqi sentiment should be balanced against reports that show the Iraqi people "have faith in what's going on. They see the improvement in their lives, and they want us to stay until such time as they are able to reassume full sovereignty over their country."
The mood was darkened by a truck-bomb explosion in southern Iraq that killed more than two-dozen people, including Italians. Mr. Bush, at a medal ceremony at the White House for NATO Secretary-General George Robertson, said the United States "sends our deepest condolences to the families who died — the soldiers and policemen who died. We appreciate their sacrifice."
Bremer rushed to Washington earlier for the White House talks, canceling a planned meeting in Baghdad with the visiting Polish prime minister. Talking with reporters, he said, "The stakes are very high for the war on terrorism and the stakes are very high to moving toward a sovereign Iraqi government. It is a tough situation."
"I am completely confident and optimistic about the outcome in Iraq, but we will face some difficult days," Bremer said.
Bremer challenged assertions by U.S. officials who have said privately that the administration was frustrated by the American-appointed Iraqi Governing Council.
"I don't think it's fair to say the IGC is failing," Bremer said. He said they face a very difficult situation and were "more and more effective in their assumption of authority."
As he heads back to Baghdad, Bremer said, "I'll be taking them a message from the president that he remains steadfast in his determination to defeat terrorism in Iraq and steadfast in his determination to give the Iraqis authority over their country — authority they are already beginning to assume very quickly both in security and in running ministries."
Powell, asked about dissatisfaction here with the Governing Council, said: "We're looking at all sorts of ideas and we do want to accelerate the pace of reform." He added that the administration is "committed to the Governing Council and we intend to help them in every way that we can."
One option under consideration: naming a new interim Iraqi leader with authority to govern the country until a constitution can be written and elections held, an administration official said. That would be patterned after the model of Afghanistan.
Iraqi insurgents have stepped up attacks — resulting in the bloodiest week for American soldiers since the end of major combat operations and at a time that U.S. and Iraqi leaders are struggling over how to draft a new constitution, a key step in handing over power to the Iraqis.
With a re-election battle ahead, Mr. Bush faces a rising casualty toll in Iraq and criticism that he lacks a strategy for postwar Iraq. As of Monday, the U.S. death toll was 394.
On Wednesday, U.S. troops opened fire accidentally on a car carrying a member of the Iraqi Governing Council, the Iraqi administration said. The council member escaped injury but the driver was hurt.
Entifadh Qanbar, spokesman for Governing Council member Ahmed Chalabi, said the accusations against the U.S.-appointed council are "nonsense and baseless."
Many members of the U.S.-picked governing council have complained that they cannot move quickly and have no real power because Bremer rules the country.