US President Barack Obama promised on Wednesday that the $787 billion economic stimulus package will create 3.5 million jobs in the next two years and announced plans to cut tax, setting in motion a gigantic task of bringing the crisis-ridden US economy back on track.

"The recovery plan we passed is the first step in getting our economy back on track. But it is just the first step," he said in his maiden address to the joint session of US Congress.

"Because even if we manage this plan flawlessly, there will be no real recovery unless we clean up the credit crisis that has severely weakened our financial system," he said.

The President said he wants to 'speak plainly' and candidly about this issue, as every American should know that it directly affects 'you and your family's well-being.'

"You should also know that the money you've deposited in banks across the country is safe; your insurance is secure; and you can rely on the continued operation of our financial system. That is not the source of concern," Obama said.

"The concern is that if we do not re-start lending in this country, our recovery will be choked off before it even begins," the President said.

"You see, the flow of credit is the lifeblood of our economy. The ability to get a loan is how you finance the purchase of everything from a home to a car to a college education; how stores stock their shelves, farms buy equipment, and businesses make payroll," Obama said.

The US President said his agenda to revive the US economy begins with jobs.

Over the next two years, this plan will save or create 3.5 million jobs. More than 90 per cent of these jobs will be in the private sector -- jobs rebuilding roads and bridges; constructing wind turbines and solar panels; laying broadband and expanding mass transit, he said.

"Because of this plan, there are teachers who can now keep their jobs and educate our kids. Health care professionals can continue caring for our sick.

"Because of this plan, 95 per cent of the working households in America will receive a tax cut -- a tax cut that you will see in your paychecks beginning on April 1st," he said.

Families who are struggling to pay tuition costs will receive a $2,500 tax credit for all four years of college.

Americans who have lost their jobs in this recession will be able to receive extended unemployment benefits and continued health care coverage to help them weather this storm, he said.