WASHINGTON - US President Barack Obama struck a defiant tone in his State of the Union speech, challenging a sceptical Republican-led Congress to back tax hikes on rich Americans that will pay for middle-class tax breaks.
Addressing Congress for the first time since Republicans took control of the Senate in November elections, the Democratic president made it clear he will not back down from his opponents. Instead, he urged them to engage in a debate about the future "without demonising each other."
"Imagine if we broke out of these tired old patterns. Imagine if we did something different, " he said.
Many of the proposals outlined in his penultimate address, while popular with many Americans, are unlikely to become reality, given Republican opposition and the fact that Mr Obama will soon become a lame duck as the United States focuses on the 2016 campaign to succeed him.
Political pundits believe Mr Obama's address sets a defiant tone for the rest of his presidency and is in line with the recent executive actions he has taken.
Professor Allan Lichtman, who teaches history at American University, said: "Mr Obama really has decided that he is going to pursue a bold agenda."
Added Mr Thomas Mann, senior fellow for governance studies at Brookings Institution: "This speech is the latest in a series of actions reflecting...his determination to make the most of the leverage for leadership available to him."
On the back of an improving economy and rising approval ratings, Mr Obama made it clear that he has not forgotten America's middle class.
While highlighting the country's economic progress - falling unemployment, shrinking deficits and booming energy production - he emphasised that economic benefits should go to all Americans and not just the wealthy.
"Will we accept an economy where only a few of us do spectacularly well? Or will we commit ourselves to an economy that generates rising incomes and chances for everyone who makes the effort?" he said.
As Mr Obama mapped out his agenda for the coming year in the hour-long speech, his populist economic message to help the working class - with tax credits for young families and relief for students - took top billing.
"Let's do more to restore the link between hard work and growing opportunity for every American," said Mr Obama to applause.
To pay for these measures, the US President intends to close tax loopholes in inherited assets, increase capital gains tax for high-income households and introduce new fees to financial firms. A total of US$320 billion (S$428 billion) over 10 years would be collected by targeting wealthy individuals and banks.
"Middle-class economics works...expanding opportunity works. And these policies will continue to work, as long as politics don't get in the way," Mr Obama said to a largely Republican Congress, which has already dismissed many of these proposals.
Congressman Paul Ryan, for example, said in a statement that families are lifted "with a simpler, flatter tax code, not big tax increases". Many others were quick to point out that the President is engaging in class warfare.
Continuing his populist agenda, Mr Obama called on Congress to look out for families by expanding access to paid sick leave and maternity leave. The US remains the only developed country in the world that does not offer paid maternity leave.
In keeping with previous years, foreign policy took a back seat to domestic issues during this annual address. Global security issues, however, did come to the fore.
"We stand united with people around the world who've been targeted by terrorists," said Mr Obama, who called for Congress to show the world that the United States is united in its fight against violent extremism by "passing a resolution to authorise the use of force" against the Islamic State in Iraq and Syria (ISIS).
In the wake of the Sony Pictures hack, Mr Obama also raised the importance of cyber security and the need to "meet the evolving threat of cyber attacks, combat identity theft and protect out children's information".
"If we don't act, we'll leave our nation and our economy vulnerable," he added.
With regard to Asia, Mr Obama made reference to China as a country trying to write the rules on business and trade in Asia.
But instead of letting that happened, he asked Congress to give him "trade promotion authority to protect American workers with strong new trade deals from Asia to Europe that aren't just few, but fair".
He also touched briefly on how the US is "modernising alliances while making sure that other nations play by the rules" in areas such as climate change and maritime disputes in the region.