Out-innovate, out-educate world: Obama

President Obama challenged Americans on Tuesday night to unleash their creative spirit, set aside their partisan differences and come together around a common goal of outcompeting other nations in a rapidly shifting global economy.

In a State of the Union address to a divided Congress, Obama outlined what he called a plan to "win the future" — a blueprint for spending in critical areas like education, high-speed rail, clean-energy technology and high-speed Internet to help the US weather the challenge from emerging powers like China and India. "The rules have changed," he said.

"We need to out-innovate, outeducate and outbuild the rest of the world," he said. "We have to make America the best place on earth to do business. We need to take responsibility for our deficit and reform our government. That's how our people will prosper."

Just weeks after Tucson shooting that left Representative Gabrielle Giffords, (incidentally doctors in Houston upgraded Giffords's condition from "serious" to "good" on Wednesday), gravely injured, Obama received a reception that was civil.

Reaching out to Republicans who have vowed to end the pet projects known as "earmarks," Obama pledged to veto any Bill that contained them. He tried to defuse partisan anger over his health care measure with humour, saying he had "heard rumours" of concerns over the Bill, and reiterated his pledge to fix a tax provision that both parties regard as burdensome.

The speech laid the foundation for next year's fight for re-election. He outlined initiatives in five areas: innovation; education; infrastructure; deficit reduction; and a more efficient federal bureaucracy.SHERYL GAY STOLBERG

The seating

In a break with tradition, lawmakers crossed party lines to sit Republican and Democrat, side by side. There was Senator John McCain, Republican of Arizona, sitting on the Democratic side of the House aisle between Senator John Kerry of Massachusetts and Senator Tom Udall, of New Mexico. The seating caused some confusion. When Obama would say something that normally would have spurred Democrats to stand, some did, others refrained, and Republicans sometimes followed their lead.

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