GEORGE W Bush last night suffered humiliation on Iraq as a panel of distinguished US senators damned his approach to the country's deepening crisis and urged him to adopt a new way forward or see a "slide toward chaos".

It came as Britain's former top soldier, General Sir Mike Jackson, yesterday launched an outspoken attack on the government, warning that strategic failings and "inadequate" funding were putting troops at risk.

After nearly four years of conflict and the deaths of more than 2900 American troops, 126 British soldiers and tens, if not hundreds, of thousands of Iraqis, the Iraq Study Group (ISG) branded the situation in Iraq "grave and deteriorating" and warned that the US's ability to influence events on the ground was "diminishing".

The warning came as the US military confirmed that 10 American soldiers were killed in four incidents in Iraq yesterday. Lieutenant Colonel Christopher Garver said some of the victims had been killed by roadside bombs and others in combat.

The 10-member study panel urged a withdrawal of most combat troops by early 2008 and told the White House that it must "engage constructively" with its enemies in Iran and Syria, something Mr Bush has to date set his face against.

It also had a warning for the Iraqi government, saying that if it did not make substantial progress in providing its own security, then America should reduce its political, military and economic support.

The 142-page report, which came in the form of a paperback book, was published just 24 hours after Robert Gates, expected to be the next US Defence Secretary, admitted the US was "not winning" in Iraq.

Last night, the UK government's response to the ISG report was somewhat muted with Margaret Beckett simply welcoming the "substantial and complex piece of work". The Foreign Secretary said the senators' "thinking was broadly in line with our own" but stressed time was needed to digest it.

Liberal Democrat leader Sir Menzies Campbell said: "This is the beginning of the end of the Iraqi adventure, which has been Britain's biggest foreign policy mistake since Suez."

Tony Blair, due to arrive in Washington late last night, will today discuss the report not only with Mr Bush but also with Congressional leaders, including senators Hillary Clinton and John McCain.

General Sir Mike Jackson, who retired as head of the Army in August - criticised UK defence bosses for "considerable inertia" in not recognising that pressures on the ground in Iraq and Afghanistan had grown beyond initial expectations.

Giving the BBC's Dimbleby Lecture, he said: "The inescapable deduction is that the funding allocated on the basis of assumptions is inadequate, because the virtual world defined by those assumptions has been overtaken by the real world.

"There is therefore a mismatch between what we do and the resources we are given with which to do it."

In the lecture to be broadcast on BBC1 tonight, Sir Mike lambasts the MoD for its continuing failure to put the "soldier, sailor and airman and their families wholeheartedly to the forefront".