WASHINGTON — Thirty-two years after President Ronald Reagan proclaimed that “government is the problem” and 17 years after President Bill Clinton offered a surrender of sorts on that issue by stating that the “era of big government is over,” President Obama made a case Tuesday night for closing out the politics of austerity.

In a State of the Union address largely focused on economic themes, he asserted that “we can’t just cut our way to prosperity” and suggested that it is time for a more balanced approach, including accepting that government has a vital role to play in ensuring economic growth and a secure middle class.

“Most of us agree that a plan to reduce the deficit must be part of our agenda,” Mr. Obama said. “But let’s be clear: deficit reduction alone is not an economic plan.”

In setting out how government could reach what he considers an acceptable level of fiscal stability through Medicare cuts and tax increases, Mr. Obama was doing more than trying to set the terms for the next, fast-approaching rounds in his fiscal cage match with Congressional Republicans. He was also building a broader argument that the nation needs to shift away from the focus on shrinking the government that has dominated politics for the past several years and toward a modestly more activist agenda aimed at tackling persistent inequality and the dislocating forces of a globalized, technology-driven economy.