BAGHDAD (AP) - Saddam Hussein, in remarks televised Wednesday, said Iraq "has huge capabilities" and is ready to face a U.S. attack, "destroy it and defeat it." A senior Baghdad official condemned U.S. President George W. Bush's state of the union speech, saying it was filled with "cheap lies."

"When faced with an attack, we always put in our calculation the worst case scenario and we build our tactics on that," Saddam told military commanders. "We know that they are coming with large forces of infantry and armoured units to storm our defensive positions. But we will absorb the momentum of the attack, destroy it and defeat it."

Saddam said the Americans have no right to attack Iraq "and every one of them, from the top down to the smallest soldier, is coming as an aggressor with ambitions."

"We will have long successive defence lines with continued support of equipment," Saddam said. "Iraq is not Afghanistan. Iraq has huge capabilities and throughout history, Iraqis never allowed foreigners to stay on their homeland."

As the crisis with the United States escalates, Iraqi television has been frequently broadcasting scenes of Saddam conferring with military commanders and senior lieutenants. It was unclear when the meeting aired Wednesday took place.

The broadcasts appear aimed at rallying the Iraqi population at a time of crisis and sending out the message that Saddam remains in firm control of the military and civilian leadership.

On Wednesday, a top Iraqi official took issue with Bush's address to Congress.

"Banned weapons are not small objects that Iraq can hide," Maj.-Gen. Hossam Mohammed Amin, head liaison to UN arms inspectors, said on Iraqi television. "Iraq has gotten rid of all these weapons."

Iraqi leaders also rejected Bush's allegation of past or potential links between Baghdad and the Sept. 11 terrorists. "There's no connection between al-Qaida and Iraq," said legislator Hazem Bajilan, a foreign affairs specialist in the National Assembly.

Ordinary Iraqis, meanwhile, voiced growing fears of a new U.S. war, a conflict one doctor saw as a "catastrophe" in the making for civilians.

International arms inspection teams pressed on with their unannounced rounds Wednesday, dropping in on an Iraqi missile-fuel plant, an ammunition depot and other sites, as their chiefs prepared to meet behind closed doors with the UN Security Council in New York.

Those chiefs, Hans Blix and Mohamed ElBaradei, reported to the council Monday that Iraq was co-operating on practical matters in the two-month-old inspection process, but was not offering evidence to allay suspicions it retains chemical or biological weapons missed by previous UN inspectors in the 1990s.

Iraqi officials said they would submit their own rebuttal to the United Nations by Thursday, "clarifying" points raised by the chief inspectors.

Under UN resolutions dating to Iraq's defeat in the 1991 Gulf War, the Baghdad government is forbidden to pursue nuclear or other programs to make chemical, biological or nuclear weapons. If inspections certify Baghdad's full compliance, the Security Council will consider lifting 12-year-old international economic sanctions on Iraq.

The U.S. and British governments contend Iraq has hidden programs, and they threaten a military invasion if, in their view, it doesn't comply and disarm. But most other governments, including those of close allies, are reluctant to grant UN authorization for such an attack.

In his state of the union speech, Bush asserted that such Iraqi weapons would be a threat to the United States, and "sometimes peace must be defended" through war.

The U.S. president's address was not available to ordinary Baghdadis through television or radio, but such threats are familiar to Iraqis.

"Under sanctions, even now, the health situation for Iraqi children is bad," Dr. Ahmed Abdul Fattar told a reporter at a Baghdad children's hospital on Wednesday. "You can imagine if a war breaks out. This would be a health catastrophe."

War worries are weighing on all Iraqis, said Hussein Fadel, a high school physics teacher. "All people here are tired of thinking - they're thinking all the time whether Iraq is going to face attack or not," he said in English.

In his speech, Bush referred to biological agent anthrax, the nerve agent VX and other weapon types, and said, "The dictator of Iraq" - Saddam - "is not disarming."

The UN inspectors of the 1990s certified the destruction of thousands of munitions containing such agents, but open questions remain about some, because of discrepancies and gaps in Iraqi accounts of arsenals and numbers destroyed.

The Bush administration has said for months it has "solid" evidence such weapons remain hidden in Iraq, but it has yet to produce anything concrete. U.S. Secretary of State Colin Powell is scheduled to appear before the Security Council on Feb. 5 to present what is billed as new such intelligence information.

The Iraqi deputy prime minister, Tariq Aziz, was dismissive. "The accusations of Mr. Bush in his statement last night are baseless, simply baseless," Aziz said in an ABC interview.

"Now people are more unconvinced about the Bush allegations than any time before."

Amin, a general, said on Iraqi TV that Bush's speech was full of "cheap lies with a political purpose." He went on, "We deeply regret that Little Bush" - an epithet frequently used here for the second President Bush - "is relying on lies. He knows that Iraq has respected all resolutions."

Chief nuclear inspector ElBaradei, director general of the International Atomic Energy Agency, said Tuesday his experts have yet to receive any "actionable" intelligence from the Americans.

In fact, in his state of the union address, Bush revived an old allegation that ElBaradei's IAEA concluded was wrong: that aluminum tubes Iraq sought to import were meant for equipment to enrich uranium for nuclear bombs.

"They're not looking for the truth," another senior Iraqi, presidential adviser Amer Rashid, said of the Bush administration. "What they're looking for is to distort the truth."