President Barack Obama sketched out his vision and goals in an era of divided government as he spoke to the nation in his State of the Union address last night. Here are some highlights:

DEFICIT: Obama said the economic recovery made possible a renewed focus on the deficit. He proposed a five-year freeze on nondefense spending that would cut the deficit by more than $400 billion over the next decade. He vowed to veto bills with lawmakers’ pet projects and called for simplifying the tax code. He called for an end to tax breaks for the wealthiest 2 percent of Americans.

INNOVATION: Obama called for investing in biomedical research, information technology and clean energy technology. Among his goals: 1 million electric vehicles on the road by 2015 and 80 percent of U.S. electricity from clean energy sources, including nuclear and clean coal as well as solar and wind. "In America, innovation doesn’t just change our lives. It’s how we make a living," Obama said.

HEALTH CARE: Obama defended his health care overhaul law, now under siege from Republicans. He expressed a willingness to improve the law. He also indicated he was open to GOP ideas on medical malpractice reform to bring down costs. "So instead of re-fighting the battles of the last two years, let’s fix what needs fixing and move forward," he said.

FOREIGN POLICY: In a speech largely devoted to domestic issues, Obama also touched on foreign policy, saying the U.S. commitment to Iraq has been kept and the war is coming to an end. In Afghanistan the drawdown of U.S. forces will begin in July as American troops have captured Taliban strongholds and trained more Afghan security forces.

GOVERNMENT: Obama scoffed at a government in which the Interior Department oversees salmon in fresh water and Commerce handles salmon in salt water. "And I hear it gets even more complicated once they’re smoked," he joked. Obama promised a plan to merge, consolidate and reorganize the federal government that he would submit to Congress for a vote.

POLITICS: Obama pleaded with Republicans and Democrats to work together, especially in the wake of the shooting that seriously wounded Arizona Rep. Gabrielle Giffords. Many lawmakers ignored party lines and sat together for Obama’s address. "What comes of this moment will be determined not by whether we can sit together tonight, but whether we can work together tomorrow," he said.

MILITARY: Obama marked the end of the ban on gays serving openly in the military. Citing the change, he called on colleges to open their doors to military recruiters and ROTC.