Using declassified intelligence to justify an increasingly unpopular war in Iraq, Bush told the 228 graduates that America is really fighting Osama bin Laden and his terror network, and that defeat in Iraq would shift that battle to America.

"I see the intelligence every day. The danger has not passed. We are in the eye of a storm and dangerous winds are swirling, and they could reach our shores at anytime," Bush said during his commencement address.

As Bush spoke, about 1,000 protesters rallied outside the academy, waving signs with messages like "Impeach Bush," "Guilty of War Crimes" and "Bring the Troops Home." Still, a few offered encouragement, waving American flags and holding up signs proclaiming "Support our Troops" and "No Surrender, No Defeat."

During the graduation ceremony, there were no such displays of dissent, and Bush seemed to enjoy the warm response he received from the 5,000 friends and family members of the graduating cadets, the second largest class in the academy's history.

The class includes 77 women, the largest group of females ever. Among those graduating were Colleen N. Perry, of East Norwalk, and Matthew W. Zinn, of Stratford. In all, 14 state residents were among the graduating class, which includes members from California to Maine.

The nation's only Coast Guard academy was officially founded in 1876, although the service existed under different names as far back as the Revolutionary War.

"The Coast Guard was established under George Washington, or as I call him, the first George W," Bush said, adding his own take on history.

Bush pulled no punches during his commencement address, saying al-Qaida stepped up attacks in Iraq in response to the recent U.S. surge in troop strength and renewed effort to pacify Baghdad.

"Al-Qaida responded with a surge of its own to reignite sectarian violence," Bush said.

"In this war, we face a brutal enemy. Since 9/11, al-Qaida has carried out horrific attacks across the world. They make it clear they plan to attack again. Some question if the battle is part of the war on terror. If we fail in Iraq, the enemy will follow us home," Bush said.

He said Vietnam had neither the intent nor the capability to strike our homeland.

"The enemy in Iraq does," Bush warned.

Citing intelligence sources, Bush suggested bin Laden has been instructing operatives in Iraq. He said authorities foiled a 2002 plot by al-Qaida to fly a plane into the Liberty Tower in Los Angeles, the city's tallest building, and in 2005 bin Laden discussed establishing a new "terror sanctuary" in Iraq.

The president referred to other foiled terror plots as evidence his administration is making progress, including a 2001 al-Qaida plan to attack U.S. water reservoirs, the stock exchange and military academies, and a plan, foiled by British authorities, to blow up airplanes heading to the U.S.

The president said prior to the Iraq war, Iraqi President Saddam Hussein was "pursuing weapons of mass destruction," a departure from the administration's now universally discredited contention that the dictator possessed such weapons.

Still, there were lighter moments.

While handing a diploma to one cadet — Bush personally gave each a diploma and posed for a picture — the commander and chief grabbed the young man's sunglasses, put them on, offered a few "cool" moves and flashed a thumbs-up sign to the crowd.

"Whether you are graduating with honors at the top of the class or by the skin of your teeth, your presence here is a major accomplishment. You will carry the lessons you learned here for the rest of your life," Bush said.

Under a deep blue sky and warm sunshine, three Coast Guard cutters idled in the Thames River. As the ceremony ended, two Coast Guard planes and two helicopters passed low overheard, with one plane tipping its wings to the new ensigns.

Marc Mares, who delivered the cadet commencement address, urged his fellow officers to remember their duty to volunteer in their communities.

"I believe the newest U2 CD can wait, and the latest exploit of Jack Bauer can wait. Volunteering grants us the vision to see a great spectrum of colors," said Mares, who is from Pasadena, Calif.

Coast Guard Commander Admiral Thad Allen said officers are linked by "honesty, respect and devotion to duty. "In a matter of weeks, these new ensigns will be standing duty," he said. "They are ready to execute their orders."