May 15 (Bloomberg) -- President George W. Bush, in a speech to Israel's parliament, said he won't negotiate with terrorists, and he criticized those who would.

``Some seem to believe we should negotiate with terrorists and radicals, as if some ingenious argument will persuade them they have been wrong all along,'' Bush told the Knesset in Jerusalem today.

``We have heard this foolish delusion before,'' he said. ``As Nazi tanks crossed into Poland in 1939, an American senator declared: `Lord, if only I could have talked to Hitler, all of this might have been avoided.' We have an obligation to call this what it is -- the false comfort of appeasement, which has been repeatedly discredited by history.''

Bush's speech quickly became an issue in the U.S. presidential campaign. Democratic presidential candidate Barack Obama's campaign interpreted the remarks as a criticism of the Illinois senator, who has said that as president he would meet with America's enemies as well as friends.

Bush's words represent ``an unprecedented political attack on foreign soil,'' Obama spokesman Robert Gibbs said in an interview on CNN.

New York Senator Hillary Clinton, Obama's rival for the nomination, decried the statement as well.

``President Bush's comparison of any Democrat to Nazi appeasers is both offensive and outrageous,'' Clinton told reporters in Rapid City, South Dakota, today. ``This is the kind of statement that has no place in any presidential address.''

No Individual Cited

Administration officials denied that Bush was directing his remarks at any individual.

``There are many who have suggested these types of negotiations with people that President Bush thinks we should not have,'' press secretary Dana Perino told reporters. ``This is long-established United States policy.''

White House national security council spokesman Gordon Johndroe said Bush was referring to ``a wide range of people, not any single person.''

Republican presidential candidate John McCain said he would ``take the president at his word'' that he wasn't referring to an individual. Still, he used the opportunity to take a swipe at Obama, the frontrunner for the Democratic nomination.

``It does bring up an issue we will be discussing with the American people and that is why does Senator Obama want to sit down with a state sponsor of terrorism? What does he want to talk about with Ahmadinejad?'' McCain said.

Talks

Obama came in for criticism early in the campaign for saying he would be willing as president to meet with Iranian President Mahmoud Ahmadinejad.

Twice in the last month McCain also has suggested that the militant Palestinian group Hamas, which the U.S. labels a terrorist organization, favors Obama because of statements made by a Hamas representative. Obama has said he would refuse to negotiate with Hamas unless they ``renounce terrorism, recognize Israel's right to exist and abide by past agreements.''

Bush, in his speech to the Knesset, prophesied a peaceful Middle East 60 years from now. The Palestinians ``will have the homeland they have long dreamed of,'' he said, although he didn't say when.

Bush is in Israel on a mostly ceremonial visit to celebrate the state's 60th anniversary and to encourage Israelis and Palestinians to work toward agreement on at least the outlines of a Palestinian state. Bush gave no timeframe for the establishment of such a state, which earlier in his presidency he pledged would be born before he leaves office in January.

U.S.-Israel Alliance

His speech to the Knesset -- sprinkled with Hebrew phrases that drew standing ovations -- was a 20-minute reflection on the strength of the U.S.-Israeli alliance. Focused on the distant future rather than the current state of negotiations between Israel and the Palestinians, Bush predicted in the next 60 years, a new Middle East will take shape that will be ``characterized by a new period of tolerance and integration.''

Bush reiterated his commitment to preventing Iran from getting a nuclear weapon. Iran's Ahmadinejad yesterday continued his denunciation of Israel, saying the nation is ``dying'' and that countries in the region will overthrow its ``fabricated regime'' if given the opportunity.

The Bush administration accuses Iran of backing the Islamic Hezbollah, or Party of God, militia in Lebanon and supporting insurgents in Iraq.

Iran

``America stands with you in breaking up terrorist networks and denying the extremists sanctuary,'' Bush told the Knesset. ``And America stands with you in firmly opposing Iran's nuclear weapons ambitions. Permitting the world's leading sponsor of terror to possess the world's deadliest weapon would be an unforgivable betrayal of future generations. For the sake of peace, the world must not allow Iran to have a nuclear weapon.''

Prime Minister Ehud Olmert said Israel must be ``ready to defend itself'' against Iran as it develops longer-range missiles.

Opposition Likud party leader Benjamin Netanyahu called a nuclear-equipped Iran the ``greatest danger facing mankind.'' He said ``time is running out'' to forestall Iran's acquisition of a nuclear capability.

Citing Bush's own war against Islamic terrorism, Netanyahu said, ``Israel should move from a policy of containing terror to defeating it as you have done, Mr. President.''

Bush rejected the notion that severing links with Israel would make the U.S. better off. ``Some people suggest that if the United States would just break ties with Israel, all our problems in the Middle East would go away,'' he said. ``This is a tired argument that buys into the propaganda of our enemies, and America rejects it utterly.''

Bush today toured Masada, the ancient Jewish fortress overlooking the Dead Sea where Jews committed mass suicide after holding out against the Roman army. Tomorrow, he visits Saudi Arabia, the world's largest oil exporter and the second-biggest supplier of crude to the U.S.

To contact the reporters on this story: Janine Zacharia in Jerusalem at jzacharia@bloomberg.net; Hans Nichols in Jerusalem at hnichols2@bloomberg.net.

Last Updated: May 15, 2008 16:55 EDT