Updated: 12:30 p.m.

Barack Obama took the oath of office as the 44th president of the United States on Tuesday, becoming the nation’s first black president nearly 144 years after the end of the Civil War and the abolition of slavery and as the nation faces a host of foreign policy and economic crises.

In his acceptance speech, Obama, 47, struck a sober tone, acknowledging the difficult challenges that he and his administration will face over the next four years.

“Our nation is at war, against a far-reaching network of violence and hatred. Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age,” Obama said before a sea of hundreds of thousands people.

“Homes have been lost, jobs shed, businesses shuttered. Our health care is too costly; our schools fail too many; and each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet,” he said, adding that “these are the indicators of crisis.”

Obama also referenced the increasingly pessimistic feeling in the country: “Less measurable but no less profound is a sapping of confidence across our land — a nagging fear that America’s decline is inevitable, and that the next generation must lower its sights.”

In his remarks, Obama ticked off a series of policy issues that were at the center of last year’s presidential contest, including energy issues and the collapse of the economy, as well as policy areas that Obama has sought to highlight in the weeks since the election, such as science and education reform.

“Everywhere we look, there is work to be done. The state of the economy calls for action, bold and swift, and we will act — not only to create new jobs, but to lay a new foundation for growth. We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together.

“We will restore science to its rightful place, and wield technology’s wonders to raise health care’s quality and lower its cost. We will harness the sun and the winds and the soil to fuel our cars and run our factories. And we will transform our schools and colleges and universities to meet the demands of a new age. All this we can do. And all this we will do.”

With the government already spending billions to attempt to right the faltering economy, many conservatives have already begun to call his ambitious policy proposals too costly.

Obama sought to answer those criticisms, saying that it can and will be done and noted that, “there are some who question the scale of our ambitions — who suggest that our system cannot tolerate too many big plans. Their memories are short. For they have forgotten what this country has already done — what free men and women can achieve when imagination is joined to common purpose, and necessity to courage.”

“What the cynics fail to understand is that the ground has shifted beneath them — that the stale political arguments that have consumed us for so long no longer apply. The question we ask today is not whether our government is too big or too small, but whether it works — whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified.

“Where the answer is ‘yes,’ we intend to move forward. Where the answer is ‘no,’ programs will end,” Obama continued.

Obama and his family first met with President George W. Bush and first lady Laura Bush at the White House just before 10 a.m. at the White House’s North Portico. Michelle Obama and the outgoing first lady greeted each other as their husbands shook hands outside the door.

As Obama left the White House to board the motorcade to Capitol Hill, Beatlemania-style screams could be heard from the bleachers on Pennsylvania Avenue set up for the inaugural parade this afternoon.

The new president’s route to Capitol Hill was lined largely with well-wishers and supporters, although at one point the procession passed a group of people with signs reading “Arrest Bush,” while at another anti-Obama protesters held signs that read “God Hates Obama” and “Obama: The Beast.”

Obama, to throngs of cheering onlookers, once again reaffirmed his commitment to begin withdrawing troops from Iraq, even as he looked to reassure concerns of Americans that the new president would weaken the nation’s military strength.

Obama also sought to allay the concerns of some within the Muslim world who view the wars in Iraq and Afghanistan as a war against Islam.

“To the Muslim world, we seek a new way forward, based on mutual interest and mutual respect. To those leaders around the globe who seek to sow conflict, or blame their society’s ills on the West — know that your people will judge you on what you can build, not what you destroy.

“To those who cling to power through corruption and deceit and the silencing of dissent, know that you are on the wrong side of history; but that we will extend a hand if you are willing to unclench your fist,” Obama said.

In the end, Obama’s speech struck on the familiar themes of hope and inspiration that helped launch his meteoric rise from a community organizer on the streets of Chicago to the White House.

Invoking President George Washington’s speech on the shore of the Delaware River during the Revolutionary War as he looked to inspire his troops, Obama called on the nation to rally together.

“With hope and virtue, let us brave once more the icy currents, and endure what storms may come,” Obama said. “Let it be said by our children’s children that when we were tested we refused to let this journey end, that we did not turn back nor did we falter; and with eyes fixed on the horizon and God’s grace upon us, we carried forth that great gift of freedom and delivered it safely to future generations.”

Keith Koffler contributed to this report.