 I'm Jeff Fager of CBS News in 60 Minutes. We're beginning our one-on-one with Tom Friedman. His ideas are spelled out in great detail and historical analysis in his book co-authored with Michael Mandelbaum, which is entitled That Used to Be Us, How America Fell Behind in the World We Invented, and How We Can Come Back. You are Tom. Good morning. Good to be with you. You're the Foreign Affairs columnist at The New York Times. How do you end up writing a book about the United States? It's very simple. We're old friends. I've been friends for 20 years. And every morning we live near each other about five blocks away. For the last 20 years, much to our wives' distress, we begin every day talking about the world. We talk almost every day about what's going on in the world, what are the headlines and whatnot. And we started to notice something two, three years ago. Every day, Jeff, we'd start off talking about the world, and we'd end up talking about America. Michael and I probably would qualify as American nationalists, but hopefully in the best sense of that term. We believe America does some stupid things in the world. But on a net basis is a hugely important constructive force for the world. To put it in visual terms, we really do think America is the ten pole that holds up the global system. And if that ten pole buckles a phrase, your kids won't just grow up in a different America, or Brazil, or Turkey, or China, they'll grow up in a different world. Now the book he has called, that used to be us, and the biggest question we get from people is does it have a happy ending? And we tell everybody, oh, it does. We just don't know whether it's fiction or nonfiction. For those who don't know, the title of the book was given to us by the president, but unwittingly. The day after the 2010 midterm elections, Obama gave a press conference in the White House. And at one point he said, China's building the world's fastest rail system, Singapore is doing this, China now has the world's fastest supercomputer. That used to be us. We've been running an amazing series in the times, actually about Apple Computer. If you haven't read it, I'd urge everyone to do it. But one begins with a story that I think may have originated in Walter Isingston's biography of Steve Jobs about this dinner last February in Silicon Valley with the Silicon Valley Titans and President Obama. And at one point Obama turns to Steve Jobs and says, why is it you sell 70 million iPads a year, 30 million iPhones, I'm making these numbers up, 50 million iPods, and you don't make a single one in the United States? Can't you make them in America? I could write a whole book about that. Because basically there you have two clashing world views. And let me explain why, but first to make a general observation. And this gets back to one of the fundamental things ailing America today. So in the US Air Force, Top Gun School, where we train our fighter pilots, they have a concept called the Udalloop, O-O-D-A, stands for Observe, Orient, Decide, Act. What we teach our fighter pilots is if your Udalloop, your ability to observe, orient, decide, and act is faster than the other pilots, you will shoot them out of the sky. If their Udalloop, by contrast, is faster than yours, they will shoot you out of the sky. So the ability in today's world, this really complex global economy to observe, orient, decide, and act is really critical. Obama lives in a geographic space. And the questions he's asking and what he's most concerned is the economic vigor and vitality of that geographic space. And he's saying to Steve Jobs, I rule over this geographic space. Why can't you make more of your products in my geographic space? And Steve Jobs is living in a completely different world. What world is he living in? Well, if we were not in the Great Recession now, if we were not in America, still speaking in a kind of post-911 environment, what would we actually be talking about? We'd be talking about the fact that in the last 10 years, the world's actually gone from connected to hyperconnected. It's gone from, in my own lingo, Flatworld 1.0 to Flatworld 2.0. This is actually the biggest thing happening on the planet today. And it's, in fact, driving every political, social, and economic major trend, in my view. And Flatworld 1.0 didn't even have Facebook in it, I guess. Yeah, I mean basically, you know, when I sat down to write this book, the new book, and started thinking about this, I went back to the world is flat, which I started in 2004, and came out in 2005. And I got down from my bookshelf the first edition of the world is flat. I opened it up to the index. I looked under F, F, F, F. Facebook wasn't in it. So when I sat down to write the world is flat, Facebook didn't exist, Twitter was still a sound, the cloud was still in the sky, 4G was a parking place, LinkedIn was a prison, applications were what you sent to college, and Skype was a typo. So Steve Jobs Living Your World where you have this global supply chain which is imagined here, designed here, manufactured here, marketed here, sold here, and that chain is now completely divided up. So you imagine here, marketed there, designed there, sold everywhere. There's just a global market seamless of global talent, global opportunity, and they're accessing that wherever they go. And so all of these things are now made and diced up in global supply chains, in which it's no longer made in America, it's made in the world. Made in the world is the world we live in. And that gets me to the state of the Union. Which is if that's the world we're actually living in, then here's the good news. America is hardwired to succeed in that world. I think the world we're living in is divided between HIEs and LIEs. High imagination enabling countries and low imagination enabling countries. That's going to be the great divide going forward. So if you're actually thinking about what we should be doing as a country now, say well, if this is the world, imagined, designed, manufactured, how do we maximize our ability to get more Americans, I'm going to be very parochial here for a second, participating in those supply chains? And that's all we should be thinking about as a country. And what bothers me is our oodle-loop, our ability to observe, orient, decide, and act about this world is what's totally discombobulated right now. So I would like to just for a moment break away and talk about history because it's such an important part of the book. If you could just spend some time talking about post-World War II United States and getting to the part about how America invented the modern world, and then post-Cold War. Well you know we, the hardest thing for us to adjust to is that we came out of World War II and we had all these advantages. We were the only industrial power standing basically. And it was a world of walls. And so basically, we had a monopoly and our industries had a monopoly. We had about a 20-year run there from the 50s, right up to the 70s, where basically an average American worker with an average level of performance could lead a very average lifestyle which meant he or she could buy an average house with an average size yard and have an average size family, earn an average size salary and have an average size retirement. It was good. Life was good. We're not in that world anymore. Average is over. We're now living in an age where average is officially over. That is the challenge we face today. Everyone needs to find their extra. That unique value contribution that will differentiate them from a cheaper foreign worker or a robot or automation. That's the challenge we all face right now. You actually suggest in your book, I've heard you suggest elsewhere, that it's going to take a revolution. That's about one of the more provocative things you've said. Can you talk about that please? Before we talk about the revolution, talk about sort of what the problem is, right? And the problem is our political system is really broken. Right now we've lost our ability to act collectively as a country. We can no longer do what actually got us here, which is the ability to do big, hard things together. We have killed the category of politics in America just when we need it most. That is to me the real tragedy of this moment. We so need politics to get us where we need to go. We've killed the category. So stuck. We're stuck. So what is your, you talk about a happy ending and we're close to our end. Well my frustration with Obama is very simple and it goes back to the Grand Bargain issue which is that, you know, he said that Boehner welched on the deal, Boehner says he welched on the deal. I wasn't in the room. I can't say. All I know is this. If I believed in a Grand Bargain, if I believed that was the thing to do and I'd been Obama, I'd have done the thing which he's never done since he's been president. One of the things that historians will puzzle over in fact is, and I've said this, had no chance to say it to the president personally, but I've said it to the public many times. This is the worst communicating president I've ever covered. The United States of America in a remarkable moment at a time of enormous crisis, step back and elected an African-American who had been, had a very tiny CV relatively speaking as President of the United States to lead us out of this crisis. He invested that much hope and expectation in him. It's quite amazing. Now, if you talk to Obama, what he'll tell you is that these Republicans are so bad. They are so bad. They've wanted to destroy me from day one. Well welcome to the NFL. Okay? All right. You know, enter my world. Don't Google me. Okay, it's a freak show out there. Okay? I mean, you want to be in the public space. That's what it's about. Welcome to the NFL. You know? No, they're worse than that. Oh, we're worse than that. No, let me do it. Let me do it. Worse than ever. Ever heard of Harry Truman? You know what I mean? What he faced. Oh, those Republicans. They're so bad. They wanted to destroy. So bad. Get over it. All right? I mean, yeah, yeah, they're out to, that's politics, all right? Life is about leverage. Oh, Jeff, I will negotiate with you all day as long as I've got the leverage and you don't. So yeah. I was in a fight with Boehner, okay? The question was, how do you get leverage on Boehner? So what did Obama do? He firstly farmed out the problem to the Congress, which, if Nita will forgive me, is the only institution in America less popular than the press, okay? So he actually, he went from his own popularity and handed over to Congress, all right? And by the way, a Congress that is so much more divided than actually the American people. Rather than saying, I want a grand bargain, I think this is so important, get me Allen Simpson and Erskine Bowles on the phone. Allen, Erskine, you've got a plan, Bowles-Simpson plan, hitch up your wagon, boys. We're going to go around the country for 30 days. We're going to explain to the American people that people actually voted for me. People are so much less divided than the people in Congress why this is in our national interest. 30 days of that, and I tell you, Boehner would have been in a different place. First about incentives also. Move the cheese, move the mouse. Don't move the cheese, the mouse doesn't move. So right now, all the incentives for the people in politics are to clash the way they're doing. If you had an independent third party candidate who showed that actually 50%, 60% of the American people, which some recent polls show, actually are here in the center, I think both parties would completely reorient themselves toward that cheese. And that's the revolution. That's the shock therapy that our system needs. Thank you, Tom. We could use another half hour. Appreciate it. Thank you very much. Thank you. Thank you.