Mr. Powell, speaking to the annual meeting of the Council of Insurance Agents & Brokers, said mistakes that occurred included a lack of ground troops.

A similar assessment made at this conference last year by L. Paul Bremer III, former administrator of the Coalition Provisional Authority in Iraq, created a national furor during the presidential election.

Speaking during the CIAB's 92nd annual Insurance Leadership Forum at the Greenbrier last week, Mr. Powell said, "I think we made some serious mistakes" in the war in Iraq. He said insufficient numbers of ground troops allowed the lawlessness that erupted after coalition forces entered Baghdad, and added, "We did not reconstitute civil authority fast enough" to aid in the recovery of the nation.

However, the former Secretary of State defended the decision to go to war, saying that if military action had not been taken to oust Saddam Hussein, sanctions would have been lifted, allowing him to reconstitute his armaments and once again become a threat to the region.

On the issue of the build-up of Iraq's defense forces, he said it must proceed rapidly to allow for reduction of American forces. The current strain on both U.S. military and reserve forces cannot continue, he cautioned.

Mr. Powell, who was a four-star general and chairman of the Joint Chiefs of Staff during the first Bush administration, said the United States must be successful in Iraq and cannot allow the nation to descend into civil war. "We have to stay the course," he said. "The stakes are too high."

On the economy, Mr. Powell said the nation lacks an energy policy. "I do not see the political will from the White House or anywhere else. [And] I do not see the American people conveying that desire."

He said he is also troubled by the mounting deficit, noting that the national debt is primarily financed by the purchase of treasury bills by Japan and China. Should they decide to sell them, he said, "We will be in trouble."

Earlier at the CIAB meeting, Monday's speaker, former U.S. Secretary of State Madeleine K. Albright, discussed the renewal of the Terrorism Risk Insurance Act.

"I do not know everything [about the program], but I have a pretty good grasp of common sense," she said. "If terrorism is an ongoing issue, should not our government make sure that insurance is there?"

She added, "Insurance should be there when disaster arise."

"We have to stay the course. The stakes are too high."

Former Secretary of State Colin Powell