Bush pushes peace, says U.S. "best friend" to Israel

JERUSALEM (Reuters) - President George W. Bush, in the Middle East to encourage struggling Israeli-Palestinian peace talks, has emphasized historic ties with Israel saying the United States was its "oldest and best friend in the world."

Bush, in Jerusalem to commemorate the 60th anniversary of Israel's creation, will visit the Roman-era fort at Masada and give a speech before the Knesset on Thursday.

Before making his second trip this year and also of his presidency to Israel, Bush had expressed hope that a peace deal could be reached by the time he leaves office in January, despite obstacles that have cropped up since promises were made in Annapolis, Maryland, last November.

In the latest setback to an agreement with Palestinian President Mahmoud Abbas, Israeli Prime Minister Ehud Olmert has been hit by calls to resign over suspicions he took bribes from a U.S. businessman.

Olmert has denied wrongdoing but has pledged to resign if indicted, which could lead to delaying any peace deal.

Violence around the Gaza Strip continues to hamper peace efforts. A rocket fired from the Hamas-controlled Gaza Strip struck a shopping mall in the southern Israeli city of Ashkelon and wounded several people as Bush and Olmert met in Jerusalem.

An Israeli air strike later killed two Hamas fighters and wounded four, the Islamist group and medics said.

The White House condemned the attack and blamed Hamas, which the United States considers to be a terrorist organization.

Hamas says it aims to destroy Israel and take the land from which Palestinians were driven out in 1948.

At an evening tribute to U.S.-Israeli ties and the 60th anniversary of the founding of the Jewish state, Bush appeared moved to tears when Olmert heaped praise on the U.S. president as a strong friend of Israel.

The warm reception was a contrast with American public opinion polls in which Bush's low ratings are partly due to discontent over the Iraq war.

Bush emphasized the strong bonds between the United States and Israel. "Eleven minutes after Israel came into existence, the United States became the first nation to recognize its independence," he said.

"And because (former U.S. President) Harry Truman did what was right instead of following the conventional wisdom, we can say today that America is Israel's oldest and best friend in the world," he said to applause.

Bush in his last months in office is trying to cement a Middle East peace legacy that has eluded his predecessors, and he knows that the clock is ticking.

At the evening event, Bush joked that former heads of states in the audience should "save a seat in the ex-leaders' club."

MASADA VISIT

Bush will begin Thursday with a visit to the Roman-era fortress of Masada overlooking the Dead Sea.

The site has acquired great significance for Israelis as a symbol of self-sacrifice and resistance, although the widely told story of how nearly 1,000 Jewish men, women and children committed suicide rather than surrender to the Romans is based on a single written source, Jewish historian Josephus Flavius.

"The courage and bravery of those who fought at Masada can be seen in Israelis today, as they celebrate the 60th anniversary of the founding of their nation," White House spokeswoman Dana Perino said.

Bush will later address the Knesset with a speech in which he will reiterate that the United States is Israel's closest friend and ally.

"While the anniversary is a time to think about the past, it is also a time to look forward. The United States and Israel share a belief that all people have the right to live in peace, that democracy is the best way to ensure human rights, that religious liberty is fundamental to civilized society and that using violence to achieve political objectives is always wrong," White House spokesman Gordon Johndroe said in offering a brief preview of the speech.

"That is why the United States will continue to partner with countries around the world against extremists, including Hamas, Hezbollah and al Qaeda as well as deal with Iran's nuclear weapons ambitions," Johndroe said.