WASHINGTON – President Bush will not sign any war spending bill that penalizes Iraq’s government for failing to make progress, Secretary of State Condoleezza Rice said yesterday, a fresh warning to Congress about challenging him.

Bush is expected to veto a bill this week that would order U.S. troops to begin withdrawing from Iraq by Oct. 1. Lacking the votes to override a veto, the Democratic-led Congress is considering a revised plan to pay for the way while requiring Iraq to meet benchmarks for progress.

Congress has not decided whether to punish Iraq for falling short. Rice sent lawmakers a clear message, saying Bush would not agree to a plan that penalizes the Baghdad for insufficient progress.

“To begin now to tie our own hands – and to say ‘We must do this if they don’t do that’ – doesn’t allow us the flexibility and creativity that we need to move this forward,” Rice said.

Democratic lawmakers, eager to wind the war down, showed little appetite for establishing goals without consequences. Iraq has struggled to keep its own promises for distributing oil wealth, refining its constitution and expanding democratic participation.

“The benchmarks – the Iraqis agreed to it, the president agreed it,” said Rep. John Murtha, D-Pa., who heads a House subcommittee that controls defense spending. “We’re saying to them, ‘Well, let’s put some teeth into the benchmarks.'”

Even if they agree to scrap a troop withdrawal timetable, Democratic lawmakers say they want to link U.S. support to Iraq’s performance in some way. But they must find an approach that win Republican support to pass a new bill that Bush is willing to sign.

Bush is expected the veto the war bill by tomorrow, then meet Wednesday with congressional leaders on the next steps. The current legislation would provide $124.2 billion, more than $90 billion of which would go for the wars in Iraq and Afghanistan.

Making the rounds of the Sunday talk shows, Rice said Iraqi leaders know U.S. patience is worn. Still, she said deadlines for progress could undermine the work of Gen. David Petraeus, the top U.S. military commander in Iraq, and Ryan Crocker, the new U.S. ambassador to Iraq.

“The United States is paying in blood and treasures,” Rice acknowledged. “The Iraqi leadership is being told, and I think they understand, that the kind of Iraq that there is going to be is up to them. We can’t give them a united Iraq.”

Iraq’s foreign minister, Hoshyar Zebari, said Iraqi leaders have gotten the message.

“We have no illusion that the U.S. commitment is not open-ended,” he said. “We have said it from the beginning. This is our country.”