America is heading in the right direction and now needs to reshape some priorities to ensure future strength and stability, President Barack Obama told the nation Tuesday in his second State of the Union address.

Sounding themes of optimism and pragmatism, Obama called for increasing investments in key areas such as education and clean energy while freezing some government spending for five years in an attempt to address simultaneous needs for economic growth and fiscal balance.

"We know what it takes to compete for the jobs and industries of our time," Obama said to applause. "We need to outinnovate, outeducate and outbuild the rest of the world. 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."

The annual speech to both chambers of Congress and all three branches of government, a night of political pageantry and symbolism, presented a new political reality.

Republicans now control the House and hold a stronger Senate minority after the November elections. Obama acknowledged the new order by calling for both parties to work together in the national interest instead of adhering to purely partisan ideology.

"New laws will only pass with support from Democrats and Republicans," Obama said. "We will move forward together or not at all -- for the challenges we face are bigger than party and bigger than politics."

Did you watch the speech?  What did you think or how would you grade President Obama?