State of the Union: highlights of Obama's economic plans

Highlights of President Barack Obama's economic proposals in his State of the Union address on Tuesday:

- EU-US free trade zone: The US will launch formal talks with the European Union for a transatlantic treaty that would create the world's largest free trade area and boost the US and European economies.

- Higher minimum wage: Obama proposes to raise the national minimum wage in steps to $9.00 an hour from the current $7.25. "Even with the tax relief we've put in place, a family with two kids that earns the minimum wage still lives below the poverty line. That's wrong," Obama said.

- Industrial support: A $1 billion investment to establish 15 new "manufacturing innovation institutes" around the country, in partnership with businesses. Three will be launched this year under executive authority.

- Cutting the deficit: Obama condemned looming harsh budget cuts under the so-called sequester "a really bad idea." He repeated his proposal for more balanced cuts and $600 billion in revenue increases spread out over 10 years to get the ballooning US deficit under control.

- Infrastructure: A renewed push for more infrastructure spending to boost the economy and generate jobs, with $40 billion proposed for "the most urgent upgrades," like 70,000 aging bridges around the country.

- Taxes: Obama reiterated his proposals to cut loopholes and special breaks for wealthy investors for large corporations to raise government income, end tax breaks for US companies that "ship jobs overseas" and to enact an "offshoring tax" to set a minimum tax on companies' offshore earnings.