Obama speech calls for unity to build economy

President Obama has thrown US weight behind anti-Mubarak protesters (AP)

President Barack Obama urged America last night to move beyond political point-scoring and focus all its energies instead on rising to what he called the country's "Sputnik moment" to create a new world-beating economy built on innovation and new industries.

Choosing to spend the large part of his State of the Union address last night on the economy rather than national security or foreign affairs, Mr Obama sketched a future detached from the experience of the last several years which have been ones of partisan head-butting and relentlessly high unemployment.

It was an upbeat tone that critics will see as hollow. With the Republicans now in control of the House of Representatives in the wake of last November's midterm elections, Mr Obama has no choice but to seek bipartisan co-operation. New political tempests are on the way meanwhile as Republicans demand steep cuts in federal spending and liberals on the left accuse him of being too eager to comprises.

"With their votes, the American people determined that governing will now be a shared responsibility between parties," Mr Obama was to tell the joint session of Congress according to advance excerpts from the White House. "New laws will only pass with support from Democrats and Republicans. We will move forward together, or not at all – for the challenges we face are bigger than party, and bigger than politics.

"At stake right now is not who wins the next election – after all, we just had an election. At stake is whether new jobs and industries take root in this country, or somewhere else. It's whether the hard work and industry of our people is rewarded. It's whether we sustain the leadership that has made America not just a place on a map, but a light to the world. We are poised for progress... the economy is growing again."

The theme of the address – "winning the future" – was meant as a reference to American economic leadership, but for Mr Obama the subplot clearly is his own ability to win re-election next year. In that context he faces both good and ill winds. His poll numbers have dipped sharply in recent weeks, yet he must square the spending circle with conservatives clamouring for cuts and the left seeking new spending to boost jobs.

The Obama White House has already signalled its willingness to take a serious scythe to the federal budget and last night's speech included a call for a five-year freeze on non-defence, non-social security spending. But the President was also making the argument against economic retreat, insisting that areas like clean energy, transport and education need more investment by government, not less.

"Half a century ago, when the Soviets beat us into space with the launch of a satellite called Sputnik we had no idea how we'd beat them to the moon," he intoned, rewinding to a time of American resolve that still pulls at nostalgic heartstrings. "The science wasn't there yet. Nasa didn't even exist. But after investing in better research and education, we didn't just surpass the Soviets, we unleashed a wave of innovation that created new industries and millions of new jobs. This is our generation's Sputnik moment."

The Republican leadership on Capitol Hill attempted to take the spotlight off the President, earlier in the day unveiling plans to slash domestic spending in the US by roughly 22 per cent. The cuts will be at the heart of budget proposals that will be tabled by the party in the middle of next month.

The clashing rhetoric before and after the President's speech stood in jarring contrast to the atmosphere that Mr Obama sought to summon of political civility and bipartisanship, tapping into a national mood that has sprung in part from the attempted assassination two weeks ago of Arizona congresswoman Gabrielle Giffords. Relatives of the six victims of the shooting were invited to the public gallery last night.

In a break with tradition, the Obama address was to be followed last night not by one Republican response but two. The official riposte was to be delivered by the new budget committee chairman, Representative Paul Ryan, while Michele Bachmann, the conservative congresswoman and Tea Party standard bearer, was to deliver an alternative reply. Some saw in this a developing schism in Republican ranks.

The Republican goal of returning spending to 2008 levels with a one-year saving of about $60bn is a personal rebuke to Mr Obama – that was the last year he was not in office.