Washington (CNN) -- Citing a "deficit of trust" in government by the American people, President Obama's first State of the Union address urged Congress to erode the influence of special interests and work together to confront the nation's most pressing problems.
In the nationally televised speech Wednesday night to a joint session of Congress, Obama sought to reassure Americans angry and nervous about the pace of economic recovery that his government understood the challenges and would act boldly to meet them.
The president offered populist proposals that some say could reconnect his administration with middle-class Americans, and he offered a plea to end the partisan stalemate in Washington and work for the common good.
Americans "don't understand why it seems like bad behavior on Wall Street is rewarded but hard work on Main Street isn't. Or why Washington has been unable or unwilling to solve any of our problems," Obama said. "They are tired of the partisanship and the shouting and the pettiness. They know we can't afford it. Not now. "
Rather than fight "the same tired battles that have dominated Washington for decades," Obama called for a new political climate of "common sense" approaches that invest in the American people without building "a mountain of debt."
"Let's meet our responsibility to the people who sent us here," the president said. "To do that, we have to recognize that we face more than a deficit of dollars right now. We face a deficit of trust -- deep and corrosive doubts about how Washington works that have been growing for years."
To close what he called the "credibility gap," Obama advocated ending the "outsized influence" of lobbyists. He also said government and Congress should work openly, in order to "give our people the government they deserve."
Senators and U.S. representatives filled the House chamber, joined by members of Obama's Cabinet, the Supreme Court, the military and other branches of government. Obama received repeated standing ovations in the 69-minute speech, including when he said job creation was the top priority of his administration.
Some humorous moments occurred, such as when Obama detailed tax cuts in his first year, prompting just a smattering of applause from the Democratic seating area. Nodding at seated and silent Republicans, Obama said: "I thought I'd get some applause on that one."
While the State of the Union address is the height of Washington pomp and ceremony, at least one Cabinet member was missing from the event. Secretary of State Hillary Clinton stayed in London, England, to attend international conferences on Yemen and Afghanistan and meetings with world leaders.
Guests in first lady Michelle Obama's box included Kim Munley and Mark Todd, police officers who apprehended the Fort Hood shooting suspect in Texas last year.
Read GOP response to Obama's speech
In his speech, Obama acknowledged some missteps in his first year in office since winning the 2008 election to become the nation's first African-American president.
"Our administration has had some political setbacks this year, and some of them were deserved," he said. But overall, his tone was defiant as he described successes in programs such as the Recovery Act and called for new proposals intended to create jobs and spur economic growth.
In particular, Obama said he would use an executive order to create a bipartisan commission to devise a plan for reducing the growing federal debt. The Senate recently defeated a bill by Democratic Sen. Kent Conrad of North Dakota and Republican Sen. Judd Gregg of New Hampshire to set up such a panel.
Obama's speech also proposed a three-year freeze on discretionary spending starting in 2011, tax credits for small businesses and extended tax cuts for middle-class Americans.
Also, Obama said he would work with Congress to repeal the military's "Don't Ask, Don't Tell" policy that bars gay men and lesbians from openly serving in the military. Within minutes of the speech ending, a statement by Republican Sen. John McCain opposed repealing the policy at a time when the U.S. military is fighting two wars.
Obama proposed stricter reporting requirements for lobbyists, as well as legislation to re-impose limits on campaign spending by corporations and interests groups that were lifted by a landmark U.S. Supreme Court ruling last week.
In continuing a populist-theme, Obama also called for requiring all congressional earmarks to be posted on a public Web site before a vote "so that the American people can see how their money is being spent."
However, he noted repeated instances in which bills passed by the House awaited action in the Senate, including the jobs bill that would use federal bailout money paid back by banks to fund infrastructure and other development programs.
"People are out of work, they're hurting. I want a jobs bill on my desk without delay," Obama said to applause, especially from the House side of the chamber.
The president also renewed his push for health care reform, which was his top domestic priority in 2009 but now appears imperiled by political deadlock.
A bruising legislative battle, with Republicans in virtually unanimous opposition to health care bills passed by both the House and Senate, became more muddled last week by the Republican upset victory in last week's Massachusetts special election to fill the U.S. Senate seat held for almost 47 years by liberal Democrat Ted Kennedy until his death last August.
The win by Republican Scott Brown stripped Democrats of their 60-vote Senate supermajority and gave Republicans enough votes to block most legislation in the chamber. Democrats, who were in the process of combining previously passed House and Senate bills at the time of election, have been struggling since to come up with a new legislative strategy.
Calling health care a "complex issue," Obama accepted blame for "not explaining it more clearly to the American people."
"And I know that with all the lobbying and horse-trading, the process left most Americans wondering what's in it for them," the president said.
He cited the continuing problems of rising health care costs and millions of people losing health coverage each year, asking Congress: "Do not walk away from reform. Not now. Not when we are so close. Let us find a way to come together and finish the job for the American people."
The Republican response to Obama's address, by newly elected Virginia Gov. Bob McDonnell, stated Republican policy positions on major issues to counter Obama's references to partisan politics by the GOP.
"The amount of this debt is on pace to double in five years, and triple in 10," McDonnell said of government spending, a top Republican complaint. "The federal debt is already over $100,000 per household. This is simply unsustainable. The president's partial freeze on discretionary spending is a laudable step, but a small one. The circumstances of our time demand that we reconsider and restore the proper, limited role of government at every level."
Obama also spoke of foreign issues, including his plans to end the war in Iraq while bolstering U.S. troops in Afghanistan to fight the al Qaeda terrorist network. However, domestic issues dominated the speech, including repeated calls for ending the divisive political climate in Washington.
McDonnell went on to say that "without reform, the excessive growth of government threatens our very liberty and prosperity."
"Good government policy should spur economic growth, and strengthen the private sector's ability to create new jobs," McDonnell said. "We must enact policies that promote entrepreneurship and innovation, so America can better compete with the world. What government should not do is pile on more taxation, regulation, and litigation that kill jobs and hurt the middle class."
"It is precisely such politics that has stopped either party from helping the American people," Obama said. "Worse yet, it is sowing further division among our citizens and further distrust in our government."
In a dig at Republicans in Congress, Obama specifically criticized opposition to legislation based solely on party politics.
"Just saying 'no' to everything may be good short-term politics, but it's not leadership," Obama said, bringing cheering Democrats to their feet while Republicans remained seated and silent. "We were sent here to serve our citizens, not our ambitions. So let's show the American people that we can do it together."
CNN's Dana Bash, Dan Lothian, Ed Henry, Ed Hornick, Charley Keyes, John King, Alan Silverleib and Tom Cohen contributed to this report.