The New Yorker published a story by Seymour Hersh alleging the administration has initiated covert operations on the ground to destabilize the Iranian regime -- something denied Sunday by U.S. Ambassador to Iraq Ryan Crocker in a CNN interview.

Asked whether Bush sought $400 million for such operations to "prepare the battlefield" in Iran, White House spokeswoman Dana Perino told the daily press briefing she couldn't comment.

Perino also was asked whether the election campaign was having any impact on Bush's Iran considerations and only said Bush wants to solve the Iranian issue diplomatically.

Israeli military intelligence reports Iran is preparing for an invasion and has started digging graves for the casualties.