By Paul Eckert

SEOUL (Reuters) - North Korea angrily rejected President Bush's call for dialogue, dismissing him on Friday as a "politically backward child" bent on using arms and money to change the North's communist political system.

In North Korea's first reaction to Bush's 40-hour visit to South Korea this week, a Foreign Ministry statement said the U.S. president had insulted North Korean leader Kim Jong-il by criticizing its political system and economic failings.

Bush renewed an unconditional U.S. offer for talks with North Korea, but also criticized the lack of food and freedom in the North and said his earlier provocative "axis of evil" remarks were aimed at the North's government, not its people.

"Bush's outbursts against the DPRK system are an insult to the national feelings of the Korean people," said the statement, carried by the North's official Korea Central News Agency (KCNA).

DPRK is the acronym of North Korea's official name, the Democratic People's Republic of Korea.

"The DPRK can never pardon anyone who dares pull up its supreme headquarters and slander its political system though he is a man bereft of an elementary reason or a politically backward child," it said.

"We are not willing to have contact with his clan," it said. "Useless is such dialogue advocated by the U.S. to find a pretext for invasion."

Bush said the United States had "no intention of invading North Korea" but said the 37,000 U.S. troops based in South Korea would defend the South if needed against threats posed by the North's arsenal of weapons of mass destruction.

NORTH VITRIOL SPARES SOUTH

However, while North Korea dug deep into its store of vitriolic phrases to respond to Bush's comments, it made no criticism of South Korean President Kim Dae-jung despite Kim's having voiced shared concern at the North's weapons programs.

Most analysts in South Korea say they expect North Korea to continue to avoid taking up Bush's offer for talks with the United States, but to probe Seoul's repeated offers to return to an already agreed program of exchanges.

Kim has pursued a "Sunshine Policy" of engaging North Korea and seeking peaceful coexistence with the North. Bush's tough stance on North Korea created strains which the two men worked hard to reconcile this week in Seoul.

Kim Dae-jung was eloquently silent at a news conference with Bush when asked if he had any misgivings about Bush's view that North Korea, Iran and Iraq form an "axis of evil."

South Korean Unification Minister Jeong Se-hyun chaired a National Security Council meeting late Friday to discuss ways to draw North Korea back to dialogue it broke off last year.

"There are already many proposals and offers on the table," a ministry official said, referring to a call South Korea made last month for talks on resuming reunions of families cut off by the Korean political divide since the 1950-53 Korean War.

"North Korea is probably interested in discussing food and fertilizer aid," he told Reuters.

Another official was quoted by local media as saying the North's statement was at least partly for domestic consumption and did not necessarily rule out U.S.-North Korea talks.

NORTH KOREAN FACE, FEARS

Last month, Kim Dae-jung, urged North Korea to take up a longstanding U.S. offer to hold talks, but also called for American gestures to "help North Korea save face."

Bush calmed nerves in South Korea by tempering his tough rhetoric with renewed calls for dialogue with the North.

But many analysts said Bush cut close to the bone when he criticized Kim Jong-il, an object of state-led cult worship who KCNA this week called a "great man born of heaven."

Bush told a news conference: "I am concerned about a country that is not transparent, that develops weapons of mass destruction."

"I think the burden of proof is on the North Korean leader to prove that he does care about his people," he said after remarks about deadly food shortages in North Korea.

North Korea returned what it called Bush's "slander" by reminding him of the disputed 2000 U.S. presidential election that brought him to office.

"It is ridiculous for him to imagine that the DPRK's political system is the same with that of the U.S. where he took up the presidency with the votes of less than half of the electorate," the foreign ministry said.

It also blamed U.S. policies for the North's predicament.

"His loud-mouthed 'mass-destruction weapons' and 'starvation' are a product of the hostile policy toward the DPRK, and military threat and economic blockade against it (that) the U.S. has persisted in for over half a century," the statement said.

In a reminder of the misery Bush highlighted in Seoul, South Korea reported Friday the recent arrival of 20 new defectors who fled economic hardship, bringing this year's total to 74. Last year, a record 583 North Koreans defected to the South.