Tuesday September 18, 2001

WASHINGTON- President Bush said he wanted Osama bin Laden "dead or alive" and warned yesterday of American casualties in the gathering war on terrorism. The Federal Reserve cut interest rates to shore up the economy as the nation grappled with the aftermath of the worst terrorist strike in its history.

"We will win the war and there will be costs," the president said in a midday visit to the wounded Pentagon, where military planners were readying call-up orders for 35,000 reservists. He said he was confident the armed forces were prepared to "defend freedom at any cost."

The president spoke as Attorney General John Ashcroft called for legislation from Congress this week to help authorities track elusive terrorist networks such as those that carried out last week's destruction of the World Trade Center twin towers and attack on the Pentagon.

The Federal Reserve sought to send reassuring signals to the marketplace after a week of uncertainty, cutting a key interest rate - without any advance buildup speculation - by one-half a percentage point.

The stock market opened a short while later, buffeted by a sharp slide in prices. Airline stocks were particularly battered. Congress already was discussing a government bailout, but there were announcements of yet more layoffs in an industry that was shut down for days. Traders observed two minutes of silence and sang "God Bless America" before the opening bell on the New York Stock Exchange.

Major League Baseball was returning with American flags sewn onto players' caps and uniforms and "God Bless America" replacing "Take Me Out to the Ball Game" as the traditional crowd sing-along during the seventh-inning stretch.

Bush spoke with unusual force as he mentioned bin Laden, named as the chief suspect behind the attacks.

"I want justice," the president said. "There's an old poster out West that said: 'Wanted, dead or alive.'" He spoke as halfway around the globe, Pakistani diplomats traveled to Afghanistan at the urging of the United States, seeking to have bin Laden turned over to American authorities.

"The people who house him, encourage, provide food, comfort or money are on notice. The Taliban must take my statement seriously," Bush said of the ruling regime in Afghanistan.

The wreckage of the World Trade Center smoldered still nearly one week after hijackers flew jetliners into the twin towers. Officials said the cost of repairing the Pentagon, hit by a third jetliner, would reach into the hundreds of millions of dollars. A fourth hijacked plane crashed in Pennsylvania.

An Associated Press list of people who have been confirmed dead in the attacks and identified by name totaled 321 yesterday, although the toll is expected to reach 5,000 or more. In addition, 118 were listed by the Defense Department as unaccounted for after the attack on the Pentagon. Ashcroft issued his call for anti-terrorism legislation at the Justice Department, where he also announced that the administration will place additional armed federal agents aboard commercial airliners.

The legislation the administration is seeking would permit authorities to wiretap individuals, no matter what phone they use, and increase current penalties for harboring a terrorist. "We need these tools to fight the terrorism threat which exists in the United States," he said. Sharing the podium with the attorney general, FBI Director Robert S. Mueller said the Immigration and Naturalization Service had detained 49 people in the course of the federal investigation into last week's attacks. He also took the unusual step of publicly recruiting for the FBI, saying the agency needs English-speaking individuals with a "professional level in Arabic and Farsi."

On a jarring note domestically, Mueller said the government has begun 40 hate-crimes investigation involving reported attacks on Arab-American citizens and institutions. Bush's comments about bin Laden prompted questions to White House spokesman Ari Fleischer.

He said a quarter-century-old executive order barring assassinations "does not limit America's ability to act in its self-defense." He would not elaborate.

"I'm not going to define all the steps that may or may not be taken," Fleischer said. After meeting with officials at the Pentagon, Bush adjourned to a cafeteria to greet workers, one of whom began softly singing "God Bless America."

Soon, the entire crowd, including the president, joined their voices to hers. Bush greeted hundreds, and paused to speak with a pregnant woman holding a photo of her husband, who was killed in Tuesday's attack. He rubbed her back and gave her a peck on the cheek as he said goodbye.

She and two other family members stood crying. Bush made his comments as he and other members of his administration sought to coax the nation back toward a more normal routine.

"I have great faith in our economy. I understand it's tough right now," he said. Bush, at the Pentagon, cautioned the nation it faces "a different type of war ... a different type of enemy than we're used to. ... Their network is extensive. There are no rules. They slit the throats of women who are on airplanes," he said in a reference to the death of a flight attendant aboard one of the planes hijacked in Tuesday's attacks.

Asked about his comment about a wanted poster, he replied, "All I'm doing is remembering when I was a kid. I remember they used to put out there in the Old West wanted posters that said `Wanted dead or alive.' All I want and America wants him brought to justice. That's what I want."

Earlier, Bush went to a cafeteria in the Eisenhower Executive Office Building adjacent to the White House and shook hands with employees as they streamed in.