Mr. Speaker, Mr. Vice President, Members of Congress, distinguished guests, and fellow Americans: Last month, I went to Andrews Air Force Base and welcomed home some of our last troops to serve in Iraq. Together, we offered a final, proud salute to the colors under which more than a million of our fellow citizens fought and several thousand gave their lives.

  We gather tonight knowing that this generation of heroes has made the United States safer and more respected around the world. For the first time in 9 years, there are no Americans fighting in Iraq. For the first time in two decades, Usama bin Laden is not a threat to this country. Most of Al Qaida's top lieutenants have been defeated.

  The Taliban's momentum has been broken, and some troops in Afghanistan have begun to come home. These achievements are a testament to the courage, selflessness, and teamwork of America's Armed Forces. At a time when too many of our institutions have let us down, they exceed all expectations. They're not consumed with personal ambition.

  They don't obsess over their differences. They focus on the mission at hand. They work together. Imagine what we could accomplish if we followed their example. Think about the America within our reach: a country that leads the world in educating its people; an America that attracts a new generation of high-tech manufacturing and high-paying jobs;

  A future where we're in control of our own energy and our security and prosperity aren't so tied to unstable parts of the world; an economy built to last, where hard work pays off and responsibility is rewarded.

  We can do this. I know we can, because we've done it before. At the end of World War II, when another generation of heroes returned home from combat, they built the strongest economy and middle class the world has ever known. My grandfather, a veteran of Patton's army, got the chance to go to college on the GI bill.

  My grandmother, who worked on a bomber assembly line, was part of a workforce that turned out the best products on Earth. The two of them shared the optimism of a nation that had triumphed over a depression and fascism. They understood they were part of something larger, that they were contributing to a story of success that every American had a chance to share, the basic American promise that if you worked hard, you could do well enough to raise a family, own a home, send your kids to college, and put a little away for retirement.

  The defining issue of our time is how to keep that promise alive. No challenge is more urgent. No debate is more important. We can either settle for a country where a shrinking number of people do really well while a growing number of Americans barely get by, or we can restore an economy where everyone gets a fair shot and everyone does their fair share and everyone plays by the same set of rules.

  What's at stake aren't Democratic values or Republican values, but American values. And we have to reclaim them. Let's remember how we got here. Long before the recession, jobs and manufacturing began leaving our shores. Technology made businesses more efficient, but also made some jobs obsolete. Folks at the top saw their incomes rise like never before, but most hard-working Americans struggled with costs that were growing, paychecks that weren't, and personal debt that kept piling up.

  In 2008, the house of cards collapsed. We learned that mortgages had been sold to people who couldn't afford or understand them. Banks had made huge bets and bonuses with other people's money. Regulators had looked the other way or didn't have the authority to stop the bad behavior. It was wrong, it was irresponsible, and it plunged our economy into a crisis that put millions out of work, saddled us with more debt, and left innocent, hard-working Americans holding the bag.

  In the 6 months before I took office, we lost nearly 4 million jobs. And we lost another 4 million before our policies were in full effect. Those are the facts. But so are these: In the last 22 months, businesses have created more than 3 million jobs. Last year, they created the most jobs since 2005. American manufacturers are hiring again, creating jobs for the first time since the late 1990s. Together, we've agreed to cut the deficit by more than $2 trillion.

  And we've put in place new rules to hold Wall Street accountable so a crisis like this never happens again. The state of our Union is getting stronger. And we've come too far to turn back now. As long as I'm President, I will work with anyone in this Chamber to build on this momentum. But I intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place.

  No, we will not go back to an economy weakened by outsourcing, bad debt, and phony financial profits. Tonight I want to speak about how we move forward and lay out a blueprint for an economy that's built to last, an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values.

  Now, this blueprint begins with American manufacturing. On the day I took office, our auto industry was on the verge of collapse. Some even said we should let it die. With a million jobs at stake, I refused to let that happen. In exchange for help, we demanded responsibility. We got workers and automakers to settle their differences.

  We got the industry to retool and restructure. Today, General Motors is back on top as the world's number-one automaker. Chrysler has grown faster in the U.S. than any major car company. Ford is investing billions in U.S. plants and factories. And together, the entire industry added nearly 160,000 jobs.

  We bet on American workers.

  We bet on American ingenuity. And tonight, the American auto industry is back. What's happening in Detroit can happen in other industries. It can happen in Cleveland and Pittsburgh and Raleigh. We can't bring every job back that's left our shore. But right now it's getting more expensive to do business in places like China.

  Meanwhile, America is more productive. A few weeks ago, the CEO of Master Lock told me that it now makes business sense for him to bring jobs back home. Today, for the first time in 15 years, Master Lock's unionized plant in Milwaukee is running at full capacity. So we have a huge opportunity at this moment to bring manufacturing back.

  But we have to seize it. Tonight my message to business leaders is simple: Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed. We should start with our Tax Code. Right now companies get tax breaks for moving jobs and profits overseas.

  Meanwhile, companies that choose to stay in America get hit with one of the highest tax rates in the world. It makes no sense, and everyone knows it. So let's change it. First, if you're a business that wants to outsource jobs, you shouldn't get a tax deduction for doing it. That money should be used to cover moving expenses for companies like Master Lock that decide to bring jobs home.

  Second, no American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas. From now on, every multinational company should have to pay a basic minimum tax. And every penny should go towards lowering taxes for companies that choose to stay here and hire here in America.

  Third, if you're an American manufacturer, you should get a bigger tax cut. If you're a high-tech manufacturer, we should double the tax deduction you get for making your products here. And if you want to relocate in a community that was hit hard when a factory left town, you should get help financing a new plant, equipment, or training for new workers.

  So my message is simple: It is time to stop rewarding businesses that ship jobs overseas and start rewarding companies that create jobs right here in America. Send me these tax reforms, and I will sign them right away. We're also making it easier for American businesses to sell products all over the world.

  Two years ago, I set a goal of doubling U.S. exports over 5 years. With the bipartisan trade agreements we signed into law, we're on track to meet that goal ahead of schedule. And soon there will be millions of new customers for American goods in Panama, Colombia, and South Korea. Soon there will be new cars on the streets of Seoul imported from Detroit and Toledo and Chicago.

  I will go anywhere in the world to open new markets for American products. And I will not stand by when our competitors don't play by the rules. We've brought trade cases against China at nearly twice the rate as the last administration, and it's made a difference. Over a thousand Americans are working today because we stopped a surge in Chinese tires.

  But we need to do more. It's not right when another country lets our movies, music, and software be pirated. It's not fair when foreign manufacturers have a leg up on ours only because they're heavily subsidized. Tonight I'm announcing the creation of a trade enforcement unit that will be charged with investigating unfair trading practices in countries like China.

  There will be more inspections to prevent counterfeit or unsafe goods from crossing our borders. And this Congress should make sure that no foreign company has an advantage over American manufacturing when it comes to accessing financing or new markets like Russia. Our workers are the most productive on Earth, and if the playing field is level, I promise you, America will always win.

  I also hear from many business leaders who want to hire in the United States, but can't find workers with the right skills. Growing industries in science and technology have twice as many openings as we have workers who can do the job. Think about that: openings at a time when millions of Americans are looking for work.

  It's inexcusable, and we know how to fix it. Jackie Bray is a single mom from North Carolina who was laid off from her job as a mechanic. Then, Siemens opened a gas turbine factory in Charlotte and formed a partnership with Central Piedmont Community College. The company helped the college design courses in laser and robotics training.

  It paid Jackie's tuition, then hired her to help operate their plant. I want every American looking for work to have the same opportunity as Jackie did. Join me in a national commitment to train 2 million Americans with skills that will lead directly to a job. My administration has already lined up more companies that want to help.

  Model partnerships between businesses like Siemens and community colleges in places like Charlotte and Orlando and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers, places that teach people skills that businesses are looking for right now, from data management to high-tech manufacturing.

  And I want to cut through the maze of confusing training programs so that from now on, people like Jackie have one program, one website, and one place to go for all the information and help that they need. It is time to turn our unemployment system into a reemployment system that puts people to work. These reforms will help people get jobs that are open today.

  But to prepare for the jobs of tomorrow, our commitment to skills and education has to start earlier. For less than 1 percent of what our Nation spends on education each year, we've convinced nearly every State in the country to raise their standards for teaching and learning, the first time that's happened in a generation.

  But challenges remain, and we know how to solve them. At a time when other countries are doubling down on education, tight budgets have forced States to lay off thousands of teachers. We know a good teacher can increase the lifetime income of a classroom by over $250,000. A great teacher can offer an escape from poverty to the child who dreams beyond his circumstance.

  Every person in this Chamber can point to a teacher who changed the trajectory of their lives. Most teachers work tirelessly, with modest pay, sometimes digging into their own pocket for school supplies, just to make a difference. Teachers matter. So, instead of bashing them or defending the status quo, let's offer schools a deal.

  Give them the resources to keep good teachers on the job and reward the best ones. And in return, grant schools flexibility to teach with creativity and passion, to stop teaching to the test, and to replace teachers who just aren't helping kids learn. That's a bargain worth making. We also know that when students don't walk away from their education, more of them walk the stage to get their diploma.

  When students are not allowed to drop out, they do better. So tonight I am proposing that every State -- every State -- requires that all students stay in high school until they graduate or turn 18. When kids do graduate, the most daunting challenge can be the cost of college. At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July.

  Extend the tuition tax credit we started that saves millions of middle class families thousands of dollars, and give more young people the chance to earn their way through college by doubling the number of work-study jobs in the next 5 years. Of course, it's not enough for us to increase student aid. We can't just keep subsidizing skyrocketing tuition;

  We'll run out of money.

  States also need to do their part by making higher education a higher priority in their budgets. And colleges and universities have to do their part by working to keep costs down. Recently, I spoke with a group of college presidents who have done just that. Some schools redesign courses to help students finish more quickly.

  Some use better technology. The point is, it's possible. So let me put colleges and universities on notice: If you can't stop tuition from going up, the funding you get from taxpayers will go down. Higher education can't be a luxury. It is an economic imperative that every family in America should be able to afford.

  Let's also remember that hundreds of thousands of talented, hard-working students in this country face another challenge: the fact that they aren't yet American citizens. Many were brought here as small children, are American through and through, yet they live every day with the threat of deportation. Others came more recently, to study business and science and engineering, but as soon as they get their degree, we send them home to invent new products and create new jobs somewhere else.

  That doesn't make sense. I believe as strongly as ever that we should take on illegal immigration. That's why my administration has put more boots on the border than ever before. That's why there are fewer illegal crossings than when I took office. The opponents of action are out of excuses. We should be working on comprehensive immigration reform right now.

  But if election-year politics keeps Congress from acting on a comprehensive plan, let's at least agree to stop expelling responsible young people who want to staff our labs, start new businesses, defend this country. Send me a law that gives them the chance to earn their citizenship. I will sign it right away.

  You see, an economy built to last is one where we encourage the talent and ingenuity of every person in this country. That means women should earn equal pay for equal work. It means we should support everyone who's willing to work and every risk taker and entrepreneur who aspires to become the next Steve Jobs.

  After all, innovation is what America has always been about. Most new jobs are created in startups and small businesses. So let's pass an agenda that helps them succeed. Tear down regulations that prevent aspiring entrepreneurs from getting the financing to grow. Expand tax relief to small businesses that are raising wages and creating good jobs.

  Both parties agree on these ideas. So put them in a bill and get it on my desk this year. Innovation also demands basic research. Today, the discoveries taking place in our federally financed labs and universities could lead to new treatments that kill cancer cells but leave healthy ones untouched, new lightweight vests for cops and soldiers that can stop any bullet.

  Don't gut these investments in our budget. Don't let other countries win the race for the future. Support the same kind of research and innovation that led to the computer chip and the Internet, to new American jobs and new American industries. And nowhere is the promise of innovation greater than in American-made energy.

  Over the last 3 years, we've opened millions of new acres for oil and gas exploration, and tonight I'm directing my administration to open more than 75 percent of our potential offshore oil and gas resources. Right now -- right now -- American oil production is the highest that it's been in 8 years. That's right, 8 years.

  Not only that, last year, we relied less on foreign oil than in any of the past 16 years. But with only 2 percent of the world's oil reserves, oil isn't enough. This country needs an all-out, all-of-the-above strategy that develops every available source of American energy, a strategy that's cleaner, cheaper, and full of new jobs.