9:12 P.M. EST

THE PRESIDENT: Mr. Speaker, Mr. Vice President, members of Congress, distinguished guests, and fellow Americans:

Tonight I want to begin by congratulating the men and women of the 112th Congress, as well as your new Speaker, John Boehner. (Applause.) And as we mark this occasion, we’re also mindful of the empty chair in this chamber, and we pray for the health of our colleague — and our friend -– Gabby Giffords. (Applause.)

It’s no secret that those of us here tonight have had our differences over the last two years. The debates have been contentious; we have fought fiercely for our beliefs. And that’s a good thing. That’s what a robust democracy demands. That’s what helps set us apart as a nation.

But there’s a reason the tragedy in Tucson gave us pause. Amid all the noise and passion and rancor of our public debate, Tucson reminded us that no matter who we are or where we come from, each of us is a part of something greater -– something more consequential than party or political preference.

We are part of the American family. We believe that in a country where every race and faith and point of view can be found, we are still bound together as one people; that we share common hopes and a common creed; that the dreams of a little girl in Tucson are not so different than those of our own children, and that they all deserve the chance to be fulfilled.

That, too, is what sets us apart as a nation. (Applause.)

Now, by itself, this simple recognition won’t usher in a new era of cooperation. What comes of this moment is up to us. What comes of this moment will be determined not by whether we can sit together tonight, but whether we can work together tomorrow. (Applause.)

I believe we can. And I believe we must. That’s what the people who sent us here expect of us. With their votes, they’ve determined that governing will now be a shared responsibility between parties. 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 the light to the world.

We are poised for progress. Two years after the worst recession most of us have ever known, the stock market has come roaring back. Corporate profits are up. The economy is growing again.

But we have never measured progress by these yardsticks alone. We measure progress by the success of our people. By the jobs they can find and the quality of life those jobs offer. By the prospects of a small business owner who dreams of turning a good idea into a thriving enterprise. By the opportunities for a better life that we pass on to our children.

That’s the project the American people want us to work on. Together. (Applause.)

We did that in December. Thanks to the tax cuts we passed, Americans’ paychecks are a little bigger today. Every business can write off the full cost of new investments that they make this year. And these steps, taken by Democrats and Republicans, will grow the economy and add to the more than one million private sector jobs created last year.

But we have to do more. These steps we’ve taken over the last two years may have broken the back of this recession, but to win the future, we’ll need to take on challenges that have been decades in the making.

Many people watching tonight can probably remember a time when finding a good job meant showing up at a nearby factory or a business downtown. You didn’t always need a degree, and your competition was pretty much limited to your neighbors. If you worked hard, chances are you’d have a job for life, with a decent paycheck and good benefits and the occasional promotion. Maybe you’d even have the pride of seeing your kids work at the same company.

That world has changed. And for many, the change has been painful. I’ve seen it in the shuttered windows of once booming factories, and the vacant storefronts on once busy Main Streets. I’ve heard it in the frustrations of Americans who’ve seen their paychecks dwindle or their jobs disappear -– proud men and women who feel like the rules have been changed in the middle of the game.

They’re right. The rules have changed. In a single generation, revolutions in technology have transformed the way we live, work and do business. Steel mills that once needed 1,000 workers can now do the same work with 100. Today, just about any company can set up shop, hire workers, and sell their products wherever there’s an Internet connection.

Meanwhile, nations like China and India realized that with some changes of their own, they could compete in this new world. And so they started educating their children earlier and longer, with greater emphasis on math and science. They’re investing in research and new technologies. Just recently, China became the home to the world’s largest private solar research facility, and the world’s fastest computer.

So, yes, the world has changed. The competition for jobs is real. But this shouldn’t discourage us. It should challenge us. Remember -– for all the hits we’ve taken these last few years, for all the naysayers predicting our decline, America still has the largest, most prosperous economy in the world. (Applause.) No workers — no workers are more productive than ours. No country has more successful companies, or grants more patents to inventors and entrepreneurs. We’re the home to the world’s best colleges and universities, where more students come to study than any place on Earth.

What’s more, we are the first nation to be founded for the sake of an idea -– the idea that each of us deserves the chance to shape our own destiny. That’s why centuries of pioneers and immigrants have risked everything to come here. It’s why our students don’t just memorize equations, but answer questions like “What do you think of that idea? What would you change about the world? What do you want to be when you grow up?”

The future is ours to win. But to get there, we can’t just stand still. As Robert Kennedy told us, “The future is not a gift. It is an achievement.” Sustaining the American Dream has never been about standing pat. It has required each generation to sacrifice, and struggle, and meet the demands of a new age.

And now it’s our turn. We know what it takes to compete for the jobs and industries of our time. We need to out-innovate, out-educate, and out-build the rest of the world. (Applause.) 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. That’s how we’ll win the future. (Applause.) And tonight, I’d like to talk about how we get there.

The first step in winning the future is encouraging American innovation. None of us can predict with certainty what the next big industry will be or where the new jobs will come from. Thirty years ago, we couldn’t know that something called the Internet would lead to an economic revolution. What we can do — what America does better than anyone else — is spark the creativity and imagination of our people. We’re the nation that put cars in driveways and computers in offices; the nation of Edison and the Wright brothers; of Google and Facebook. In America, innovation doesn’t just change our lives. It is how we make our living. (Applause.)

Our free enterprise system is what drives innovation. But because it’s not always profitable for companies to invest in basic research, throughout our history, our government has provided cutting-edge scientists and inventors with the support that they need. That’s what planted the seeds for the Internet. That’s what helped make possible things like computer chips and GPS. Just think of all the good jobs — from manufacturing to retail — that have come from these breakthroughs.

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 would beat them to the moon. The science wasn’t even there yet. NASA didn’t 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.

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