O’Fallon, Mo. ? Despite promising signs on both war and the economy, President Bush warned Monday, “We’re not out of the woods yet.” He offered new help for small businesses and demanded that he get his way in boosting the Pentagon budget.

“I don’t want Congress messing with the budget,” Bush said on a political trip that melded patriotic talk of war with his views on tax cuts and the budget.

President Bush, left, sits with Rolfe Albers before addressing the crowd at Albers Manufacturing Co. Albers is the president and CEO of the company. Bush discussed tax cuts and the economy Monday in O'Fallon, Mo.

With most economic indicators suggesting the recession is over, Bush is not ready to abandon economic recovery and job creation as the driving argument behind his tax proposals some of which Congress already ignored once, when it approved economic stimulus legislation earlier this month.

“Even though the economic news has been positive, in my judgment we’re not out of the woods yet. We’ve got to keep working for policies in place that encourage more job creation,” Bush said.

White House press secretary Ari Fleischer elaborated: “His big concern is we not have a jobless recovery.”

He endorsed an increase in the amount of equipment and machinery that companies can deduct in one year from $24,000 to $40,000. The measure, which would cost the government some $7 billion over 10 years, was in almost every version of the bill but didn’t make the final one, frustrating many pro-business lobbyists.

Joking that some of his proposals were understandable only by accountants, Bush told company chief Rolf G. Albers and his employees: “Let me see if I can put this in English or Texan.”

“I’m trying to put in place something that will encourage Rolf to go buy a new piece of machinery … that will make his business more competitive, and therefore more likely to be able to hire somebody; that will help the manufacturer of the machine employ somebody; that will have an affect throughout the entire economy,” Bush said.

Most new jobs are created by small business and Bush said it was his job “to create an environment in which the entrepreneurial spirit flourishes.”

He also called for allowing small businesses to pool together to buy health insurance for their workers at lower premiums. “It is beyond me why Congress can’t figure out why this shouldn’t work,” he said.

He was also proposing to:

Expand employer-provided tax-free savings accounts for medical expenses, or MSAs, by eliminating the nationwide cap on the number of MSAs allowed, by lowering deductibles, and by allowing coverage for preventive care all at a 10-year cost of $6 billion.

Allow small businesses to earn interest on checking accounts.

Review government contracting practices and “ensure that government contracts are open to all small businesses that can supply the government’s needs.”

On his fifth trip to Missouri since becoming president, Bush and his uncle, William H.T. “Bucky” Bush, headlined a fund-raising dinner of lemon garlic chicken that brought in $1.5 million for the state GOP and Senate candidate and former Rep. Jim Talent, the White House’s hand-picked choice to challenge Democratic Sen. Jean Carnahan.

Carnahan was appointed after her husband, then-Missouri Gov. Mel Carnahan, died in a plane crash but still beat then-incumbent Sen. John Ashcroft in the 2000 election. This year’s election will not only determine who serves the remaining four years of the six-year Senate term but, more critically for the Bush agenda, whether Democrats will maintain their one-vote control of the Senate.