Not too long ago, Mad Money TV host Jim Cramer said Andrew Liveris might be the single worst CEO ever to run a major company. One could see the reasons why.

Liveris, the boss of Dow Chemical, felt the firm needed to move away from commodity chemicals and toward more-profitable specialty chemicals (such as fuel additives). So in July 2008 he agreed to buy specialty-chemical maker Rohm & Haas for more than $15 billion, with financial support from a Kuwaiti joint venture. But the Kuwaitis backed out just as the global meltdown started. Liveris tried to delay the deal, but in the end Dow bought Rohm & Haas at full price.

Between July 2008 and mid-March 2009, Dow s stock fell 80 percent. On his TV show, Cramer placed Liveris s photo on the Wall of Shame, a spot Liveris shared with the boss of AIG and other corporate pariahs. Dow cut its dividend and took a $9.2 billion short-term loan to complete the Rohm & Haas deal. Liveris says all that was missing from the ordeal was a plague of locusts.

It s not the first time Liveris, originally from Darwin, Australia, has made waves in his 35-year career at Dow. Back in 2003 commodity prices were soaring and skewering Dow s profits, but Dow had long-term sales contracts that locked it into delivering chemicals at a set price. So Liveris, then the company president, tried to redo the contracts. The move enraged many of Dow s customers, but ultimately, they paid the higher prices it demanded.

Dow, which dates back to 1897, got past Liveris s move then (he was made CEO in 2004), and it appears to have survived the Rohm & Haas deal, too. In the first three months of 2010, sales of specialty products were up 22 percent from the same time a year earlier. Of course, the deal looks a lot better now, with the global economy back from the brink, but Dow has cut its costs dramatically too. The stock has more than quadrupled off its lows, and the firm paid back the short-term loan. The Dow boss is no longer on the Wall of Shame. Liveris has totally redeemed himself, Cramer says now.

Liveris still has some detractors. The firm sold billions of dollars worth of assets many at fire-sale prices and it still has $19 billion in long-term debt, says CreditSights analyst Wen Li. Liveris, 56, admits his plan isn t perfected yet. I want to feel terrific, but there s always what you don t know. At the firm s Midland, Mich., headquarters, Liveris talked about why Dow wants to make specialty chemicals, what it can do to become green and how he makes peace with a 24-7 work schedule.

Dow was making money selling basic chemicals. Why make such big changes?

It isn t a question of the risk we took but what we would have suffered if we didn t. The graveyard of chemical companies that refused to change is full. This change is similar to one executed in the 1940s, when Dow bought mosquito-infested swampland in Texas. What we were doing in Michigan was not sustainable. But the low-cost oil and gas in the Gulf [of Mexico] ultimately led to an explosion of innovation in petrochemicals. We had chemical by-products and figured out new uses: This can be glue, insulation, paint!

Will Dow Chemical be environmentally friendly?

I hope so. The world population will swell from more than 6 billion now to 9 billion by 2050. For that 9 billion to have lifestyles like a minority of us enjoy now requires solutions. We identified megatrends in energy, agriculture and water. We made a decision to go after energy-efficiency and water standards. One thing I can say: We never detoured in our R&D spending. We see about $30 billion in sales coming from products like our solar shingles, SmartStax corn and Thermax insulation.

Is there any one product that can move the needle?

This is the work of the next several years. I will tell you this: The total market for chemicals is $2 trillion. The top 10 companies have 14 percent the market is very fragmented. That will mean that Dow could be a $100 billion company with 40 percent margins. We won t get there organically in five years; we will have to go back to mergers and acquisitions. But first I want to stabilize and deliver our earnings power of $4 to $4.50 a share in 2012.

Joint venturing is critical to your future. Why?

You are sitting on polyurethane foam that comes from two chemicals where Dow has developed superior technology. A partner will have low-cost inputs, like oil and natural gas, but lack the technology. We want to put our capital more downstream, closer to the customer, not in the building blocks. If we can share capital costs with people who have low-cost inputs, we get that benefit for our products. They get the use of the technology, and they get jobs.

What s your outlook for the U.S. economy?

It won t look like 2007 until 2012. The U.S. needs an advanced manufacturing industry. Who can stimulate it? The government. We need to invest in parts of the U.S. economy where we have some competitive advantage aerospace, automotive, chemistry, semiconductors and telecommunications. The key point: It has to be a thing, not just a service. A financial service, movies, entertainment? Other countries can copy that pretty quickly.

How do you find balance in your life?

In life there are four buckets: self, family, friends and work. Life gives you enough water for only two of them. If you consciously decide where water goes, you re fine. In the last 10 years, my water is in family and work. Self and friends will have to wait.