WASHINGTON (AP) — President Barack Obama insisted Friday that the U.S. economy is digging itself out of the deepest recession in decades but conceded that “progress has been painfully slow” and many voters in November’s elections may blame him.

Facing a rising jobless rate, Obama told a White House news conference: “For all the progress we’ve made, we’re not there yet. And that means people are frustrated and why people are angry.”

“Because I am president, and the Democrats have control of the House and Senate, it’s understandable that people are saying, ‘What have you done?’”

The president, who also is the leader of the Democratic Party, spent much of his appearance before cameras on the defensive, underscoring his frustration with being unable to convince the public that his economic fixes are working.

At his first formal session with reporters since May, one that lasted nearly an hour and 20 minutes, Obama also appealed to Americans to stand by the nation’s long heritage of religious tolerance.

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The Rev. Terry Jones, from a small fundamentalist church in Florida, triggered outrage when he promised to burn the Quran on Saturday’s anniversary of the Sept. 11 attacks. He canceled the plans Thursday but then said he was reconsidering. Obama said he hopes Jones “prays on it and refrains from doing it.”

Declining to mention Jones’ name, Obama referred to him as “the individual down in Florida.”

A debate is also raging over whether an Islamic center should be built near the site of the Sept. 11, 2001, attacks on the World Trade Center in New York.

Obama said people must remember that the country’s enemy is not Islam but al-Qaida and other extremist groups. He said Americans cannot turn on each other and let their fears lead to divisions.

On the eve of the ninth anniversary of the terror attacks, Obama said the U.S. is still hunting for attacks mastermind Osama bin Laden. He said bin Laden had gone “deep underground” but efforts to hunt him down would go on “as long as I’m president.”

He said “the folks who are most interested in the war between Islam and the West are al-Qaida. That’s what they’ve been banking on.” He said the battle was against just a handful of people “who are engaging in hateful acts.”

He counseled respect and inclusion for Muslims in the United States. He said, “They are Americans. We don’t differentiate between ‘them’ and ‘us.’ It’s just us.”

As for continued terror threats against America, nine years after Sept. 11, Obama said, “There is always going to be the potential for an individual or a small group of individuals, if they are willing to die, to kill other people. … That threat is there, and it’s important, I think, for the American people to understand that. And not to live in fear; it’s just a reality of today’s world that there are going to be threats out there.”

He added, “We are going to have this problem out there for a long time to come, but it doesn’t have to completely distort us and it doesn’t have to dominate our foreign policy. What we can do is to constantly fight against it.”

Obama also said he is encouraging peace talks between Israel and the Palestinians because the alternative is a status quo that puts both parties — and the U.S. — at risk.

Admitted his administration has fallen short in his goal of closing the Guantanamo Bay detention center after promising to close it within his first year as president. He said he still believes the American justice system is capable of prosecuting, convicting and holding terrorists who have attacked the U.S.

On the economy, Obama repeated his contention that Republican obstructionism is hampering his ability to steer the nation into a stronger recovery. He renewed his insistence that Senate Republicans drop their stalling of a bill before the Senate to help small businesses.

And he said yet again that Bush-era tax cuts should be extended for individuals earning less than $200,000 a year and joint filers earning less than $250,000. All the Bush tax cuts are to expire at the end of this year unless Congress acts.

Associated Press writers Liz Sidoti, Anne Gearan, Erica Werner, David Pace, Jim Kuhnhenn, Donna Cassata, Merrill Hartson and Mike Hammer contributed to this report.

Copyright 2010 The Associated Press.