US:US president George Bush is considering a package of new military, political and economic measures for Iraq, including job and loan schemes, aimed at winning local support for the US presence.
The president is also considering increasing troop levels in Iraq by 17,000-20,000, partly by delaying the departure of two marine regiments now deployed in Anbar province, according to Pentagon sources cited in the New York Times.
National security advisers described the ideas as being part of a classic effort to quell an insurgency by combining economic, political and military means.
"The president is looking at a variety of ways to work with the Iraqi government to provide new economic opportunities for Iraqis, which will be essential to sustaining security gains and draining the influence of extremists," said Gordon Johndroe, the spokesman for the national security council.
Mr Bush held three hours of talks with senior national security advisers at his Texas ranch on Thursday and said later that he was making good progress towards developing a new strategy for Iraq.
"I've got more consultation to do until I talk to the country about the plan," Mr Bush said. "Obviously, we'll continue to work with the Iraqi government.
"The key to success in Iraq is to have a government that's willing to deal with the elements there that are trying to prevent this young democracy from succeeding."
As the idea of a military "surge" against insurgents and sectarian militias appears to be gaining ground within the administration, the Pentagon has insisted that any new military operation should be accompanied by economic action.
One proposal is to follow up any military sweep with a short-term work programme that would immediately employ people in the neighbourhood to help clean up rubbish and perform other civic jobs.
This would begin within hours rather than days of a military operation, with the hope of signalling a return to normality and discouraging young unemployed Iraqi men from joining militias.
The administration is also considering a micro-loan programme to help individuals set up businesses, as well as a review of dormant state-controlled industries.