It uses the default date format of the site, which is medium. You can configure that at admin/settings/date-time and choose a format which uses am/pm.

You can also implement hook_preprocess_node() in your theme or module and then override the 'submitted' variable set by template_preprocess_node(). That allows you to use a different date format just there.

Change published date to 12 hour time
Acording to the FHS, the directories /lib and /usr/lib are both for libraries (libraries used in /sbin and user libraries, respectively).

But what about the /var/lib folder? Following the same logic this folder should have something like "variable libraries" (that sounds strange) but it actually holds data generated and maintained by running programs, or as defined by the wikipedia article: 


  State information. Persistent data modified by programs as they run, e.g., databases, packaging system metadata, etc.


From a fresh view, it makes more sense to put database data and served files under /srv instead of /var/lib
