President Bush is calling for democratic reforms in the Middle East, and says Islam is compatible with freedom. Mr. Bush says the region has reached a turning point, and those who rule can either disregard the drive for democracy or can lead the way.

The president says the Middle East is ripe for democratic change. He says it is not beyond the reach of liberty.

"I believe every person has the ability and the right to be free," he said.

He says those who believe Islam is not consistent with democratic rule are wrong, noting half the world's Muslims already live in democracies. He said modernization is not the same as Westernization, adding Muslim countries should develop their own democracies in their own way.

"A religion that demands individual moral accountability, and encourages the encounter of the individual with God is fully compatible with the rights and responsibilities of self-government," the president said.

And yet, he says, there is - what he calls - a freedom deficit in the Middle East that has led to deep poverty, and has left whole nations stagnant. He says, in some countries, there are signs of change, such as Morocco, Bahrain, Jordan, Yemen, Qatar and Kuwait. But he says others are ignoring calls for democratic reform, most notably Syria and Iran.

"The regime in Tehran must heed the democratic demands of the Iranian people, or lose its last claim to legitimacy," continued the president. The comments came in a speech marking the 20th anniversary of the National Endowment for Democracy, a group that supports movements for democratic change around the world. The president's comments, for the most part, were broad, and tried to project his vision of the future for a troubled region. He said the stakes are particularly high in Iraq, noting a free and democratic Iraq could serve as a model for others.

"It is worth our sacrifice, because we know the stakes," he said. "The failure of Iraqi democracy would embolden terrorists around the world, would increase dangers to the American people and extinguish the hopes of millions in the region."

The president then took the rather unusual step of saying the United States bears some of the blame for the lack of democracy in the Middle East. He said, for too long, America and its allies looked the other way, as the drive for freedom abroad was eclipsed by security concerns at home.

"Sixty years of western nations excusing and accommodating the lack of freedom in the Middle East did nothing to make us safe, because in the long run, stability cannot be purchased at the expense of liberty," said President Bush.

Mr. Bush said the United States is now focusing on promoting freedom. He said liberty is the direction of history, and the calling of our time.