By Jeremy Pelofsky

NEW ORLEANS, Aug 29 (Reuters) - President George W. Bush on Wednesday declared "better days" ahead for New Orleans despite complaints over slow rebuilding and amid lingering political fallout two years after Hurricane Katrina's destruction.

Widely criticized for a slow federal response to the disaster that left buildings in ruins and thousands homeless, Bush made his 15th visit to the region and tried to calm frustration at the pace of relief efforts.

"My attitude is this: New Orleans, better days are ahead. It's sometimes hard for people to see progress when you live in a community all the time," he said following a moment of silence at 9:38 a.m. local time, when the levees broke and the city began to flood.

Two years after the worst natural disaster in the United States, critics say the federal response is still lagging.

Katrina flooded 80 percent of New Orleans and killed about 1,400 people. Only about 60 percent of the city's pre-storm population of half a million has come back.

Democrats running for the White House in 2008 elections have seized on New Orleans as a symbol of the Republican administration's failures.

"If George Bush's government were as good and decent and focused as the people of New Orleans, whole parts of the city would not still look like the storm just hit," said Democrat John Edwards, who launched his presidential campaign last year from the hard-hit lower ninth ward of New Orleans.

"This is a national disgrace," he said in a statement.

Bush struck a hopeful note. From the first public school to reopen in the hard-hit lower ninth ward, he spoke of a city that was on the way to recovery.

"And this town's coming back. This town is better today than it was yesterday. And it's going to be better tomorrow than it was today," he said.

Bush's motorcade passed scores of boarded up homes and businesses, some still with painted markings left over from emergency workers' search for survivors and victims.

'TREAT US FAIRLY'

In September 2005, Bush stood in a darkened Jackson Square in New Orleans and gave an impassioned address to the nation, declaring "this great city will rise again."

Critics say not enough has been done to rebuild the public infrastructure such as sewer and water lines, hospitals and transportation systems, making it difficult to lure back evacuated residents and workers.

The New Orleans Times-Picayune newspaper ran a banner atop its front page for an editorial demanding "Treat us fairly, Mr. President," arguing it should not have to compete for aid.

The Bush administration says the federal government has made available or disbursed some $96 billion of $114 billion allocated for rebuilding New Orleans and the Gulf Coast that was also ravaged by the huge hurricane.

Bush stressed the federal government's commitment to helping in rebuilding efforts. "And so I come telling the folks in this part of the world we still understand the problems. And we're still engaged," he said.

The Bush administration announced last week that it would seek $4.9 billion from Congress to help complete the levee reconstruction and drainage systems, not slated to be completed until 2011. Only work through 2009 has been funded.

Myla Reese, whose family owns the Dooky Chase restaurant where Bush dined on Tuesday night, said she was not particularly concerned that the levees that failed during Katrina have only been restored to pre-Katrina levels.

"I think it was a once in a lifetime event," she said. "I'm very optimistic, I can't see that happening again."

AlertNet news is provided by