Learning Inamori Philosophy
Japan’s most influential social philosophy
In comparison with
Libertarianism and New Liberalism

Iwao Taka

Inamori Academy
Kagoshima University
1-21-30 Korimoto
Kagoshima 890-0065
Japan

Copyright @ Iwao Taka 2020
First English version published 2020
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, without the prior permission inwriting of Iwao Taka or Inamori Academy, or as expressly permitted by law, by licenseor under terms agreed with the appropriate reprographics rights organization. Enquiries
concerning reproduction outside the scope of above should be sent to Iwao Taka or
Inamori Academy at the address above.

CONTENTS
How this book came about
Preface
What did Kazuo Inamori do?
Two social philosophies that influence our thinking
Dialogues with high school students
Chapter 1

Utilitarianism as a Social Philosophy

1. Logical results of work
2. The issues discussed in social philosophy
3. Late Middle Ages and the beginning of philosophical explorations
4. Utilitarianism emerges
5. The pitfalls of utilitarianism
Chapter 2

How Libertarianism Overcomes the Limitations of Utilitarianism

1. Libertarian explanations
2. The difference between laissez-faire economics and libertarianism
3. Libertarianism in a formula
4. Trade based on free will?
5. Result oriented society
Chapter 3

Keynes’ Ideal Society

1. New Liberalism in a formula
2. Keynes’ basic questions
3. Flow of a nation’s economy
4. Multiplier effect of public projects
5. The propensity to consume and the economy
6. Problems in Japanese society
7. How financial transfer occurs
Chapter 4

Rawls’ Ideal Society

1. Rawls’ basic questions
2. Deriving the principle of justice reversely
3. Principle of equal liberties
4. Difference principle
5. “Distributive justice” in a hypothetical village
6. Principle of Equality of Opportunity
7. Abilities and talents vs just plain “luck”
8. Mismatch by modern liberalisms
9. Faults in modern liberalism

Chapter 5

Problems in Present-Day Society

1. Similarities between the two social philosophies
2. The three theoretical premises
3. Aristotle’s philosophy and the rise of communitarianism
4. What problems do present-day societies face?
5. How about Japanese society?
Chapter 6“Freedom” in Inamori Philosophy

1. Recognizing “people in association”
2. Realizing responsibilities and expectations through association
3. Associations in every-day life
4. Discovery beyond the awareness of association
5. Appreciating connections
6. Freedom from the chains of desires
7. Practicing free will
8. Human relationships are reflections of the heart
Chapter 7“Mental Attitude” in Inamori Philosophy

1. What does a Right Mental Attitude entail?
2. What traditional social philosophies despise
3. Does the formula hold true universally?
4. Difference between the “ideal society” and reality
5. Why the ideal societies will prevail
Chapter 8“Justice” in Inamori Philosophy

1. Differences between Inamori Philosophy and Rawls’ theory of justice
2. High school students behind the veil of ignorance
3. Principle of justice developed by high school students
4. Principles regarding active deeds
5. Principles regarding passive deeds
Chapter 9“Prosperity” in Inamori Philosophy

1. Are the Results of Work and the Results of Life the same?
2. Two bases for the prosperity of society
3. Negative setbacks and sustainable prosperity
4. How to deal with coincidences
5. What does the example of Mr. Inamori’s life suggest?
6. Mr. Inamori’s life-story
EpilogueAbout the AuthorTaka, Iwao (Professor of Graduate School of Economics, Reitaku University, Visiting
Professor of the Inamori Academy, Kagoshima University)
Professor Iwao Taka was born in 1956 in Oita Prefecture of Japan, graduated thedoctoral course at Waseda University School of Commerce in 1985, and received his
Ph.D. in Commercial Science in 1995.
From 1991 to 1994, Taka studied business ethics at the Wharton School - Universityof Pennsylvania. Upon his return to Japan, he has long served on a number ofgovernmental councils and committees. From 2001 through 2003, he participated in
the ISO26000 project as a representative of Japan. And in 2008, he received theInternational Compliance Award from the U.S. Society of Corporate Compliance andEthics (SCCE). For seven years since April 2007, Taka also taught at the Business Schoolof Kyoto University as a Kyocera-endowed chair professor.
His publications include "Business Ethics: A Japanese View," Business Ethics Quarterly(January/February 1994), “Fairness in International Trade and Business Ethics: A
Japanese Perspective,” Fairness in International Trade, (Springer Science + BusinessMedia, 2010), Business Ethics (Nihon Keizai Shimbun: Japanese, 2013), Bankruptcy and
Revival of Japan Airlines (Minerva Publishing House: Japanese, 2019).

How This Book Came About
The philosophy of Mr. Kazuo Inamori (1932-Present). Could younger
generations appreciate it? Could it be understood to begin with? The personalphilosophy that evolved through one man’s experiences may just be brushed
off as “one man’s success story.” But I believe Mr. Inamori’s thoughts andachievements surpass just one man’s experience; that it is a “social
philosophy” which could transform the entire society for the better. The
purpose of this book is to deliver this message.
Fascinated by Mr. Inamori’s thoughts and way of life, I, the author, wrote a
paper on “Corporate Principles and the Rapid Growth of an Organization: the
Kyoto Ceramic Company Case” for a competition more than 30 years ago.
Fortunately, it was well received by the Waseda University School ofCommerce, and the paper received the High Honor Award. This was my firststep towards becoming a researcher.
Following that experience, I extended my research on to topics such asdecision-making theory, business ethics, social philosophy, and corporatesocial responsibility. In 2006, Professor Koichiro Hioki invited me to teach the“Kyoto University Management Philosophy Course Funded by Kyocera” as avisiting professor, from April of that year through March 2014 - a period of 7
years. I had returned, by chance, to my origin of Inamori Philosophy at theprime age of fifty.
Seven years of teaching the course allowed me to take a closer look at Mr.
Inamori’s way of thinking, and to feel first hand his passion towards rebuilding
the then bankrupt Japan Airlines. This stirred my aspiration to research andwrite. In that regard, my most sincere appreciation to Mr. Inamori is due. The
opportunity to teach the Kyoto University course may have been fate.
This book discusses Inamori Social Philosophy, but it is not a conventional
philosophy textbook. While logical and accurate, I wanted to present the topic
so that it could be easily understood and appreciated, especially by younger
generations. Therefore, the book explains Inamori Philosophy in the form of aclassroom lecture in a high school.
The dialogues with high school girls that appear throughout this book are
the means to this end. The decision to write in this style originated from myexperience lecturing at a girls’ high school. Without that experience, this bookmay never have come to exist. So I sincerely thank the guidance counselors
who gave me the opportunity to give lectures at their high school over anumber of years.

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In the “readability” aspect, my former seminar student at Reitaku Univesity,
Mr. Masahiko Ohtake gave me many specific pointers and advice. I strongly
hoped he would remain in academia after graduation, but he went on to theprivate sector. It was sad to see him go, but I am thankful that we were able
to work together again in discussing this book. I wish him continued success.
Of course, too much emphasis on “understandability” and “readability” could
risk not being able to convey the depth of Inamori philosophy. During theprocess of writing, I had sent many manuscripts to Mr. Shigeyuki Kitani ofKyocera Management Research Department and received his frank opinions. I
would like to mention him here in appreciation.
The decision to write this book came in the spring of 2014, right after I
finished teaching the Kyoto University course. In 2009, the third year of myprecious time teaching at Kyoto University, I had been appointed as the
Department Head at Reitaku University, and could not spend much time on
Inamori Philosophy research. Publishing this book, therefore, was somethingthat I strongly wished to accomplish. I wrote to Mr. Inamori:“Even after concluding the Kyoto University course, I continue my researchon the significance of Inamori Philosophy, and how to convey its value especially to the younger generation. I would like to share the culmination ofthis research with the world, which I am currently planning to do through abook.” ”By this book, I strongly hope that many readers - not justbusinesspersons, but high school and college students as well, can understandthe importance of Inamori Philosophy and the necessity to put it in action.”“This, I feel, is my social obligation as a corporate social responsibility
researcher of 30 years.”
My passion for writing this book could not have materialized if not for thepeople behind it all. So, last but not least, I must express my heartfelt
gratitude to the editor in chief of Nikkei Ecology, Mr. Taro Tanaka. His
immediate response to my manuscript was, “Fascinating!” followed by his
opinion, “A book about Inamori Philosophy with high school girls! The contrast
is so charming.” His honest response is the reason this book exists. I thankgood fortune that our reunion allowed us to work together on this book.

April 2020
Iwao Taka-2-

Preface
For several years, I have taught a special course on “Economics, Social Issues,
Business Management, and Philosophy” offered to the advanced class at a girls’
high school. And every time, I have asked the class, “What kind of work would
you like to do in the future?” I have asked this same question every year at
the beginning of the course. Last year, though, the response was slow to come.
The guidance counselor had informed me beforehand that, “There are quite
a few that want to be flight attendants.” So I had expected a straightforward
response, “I want to be a flight attendant,” from the students. Yet, the class
was surprisingly quiet.
“I heard many of you want to be flight attendants,” I threw in.
Then, a girl in the front row began timidly, “I do, but I’m not tall enough.”
This started the others off. “Yeah, and the entrance tests are really hard.”
Becoming a flight attendant was THE thing to do during Japan’s economic
boom of the latter half of the 20th century, but this is the 21st century, and I
had presumed the popular female profession would have changed. Apparently
I was wrong, and being a flight attendant was still a popular career hopeamong girls.
So I went on.
“There are many airline carriers. Which company would you like to workfor?”
“Japan Airlines, JAL!” said multiple voices.
“There is All Nippon Airways, ANA, too,” I ventured, but the answer was
still, “I want to work for JAL.”“Why?” I asked, but the answer was, “I don’t know, but I still want JAL.”“Okay, so you want to work for JAL. But, you know, the company went
through bankruptcy a few years back.” “ANA is a really good company too,
you know?” I made sure, but their minds were set.
The class was warming up, so I raised a question. “Okay then, do you know

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who Mr. Kazuo Inamori is?” To my dismay, every one of them answered, “No,not a clue.” There was not enough time or words to express mydisappointment properly.
Instead, I took a breath, grinned, and gave a little threat. “Oh, you girls
want to work for JAL, but you don’t know who Mr. Inamori is? Oh no, that’s
really bad - they might say you have no right to work at JAL!”
What Did Mr. Kazuo Inamori Do?
Mr. Kazuo Inamori is one of Japan’s foremost corporate executives. He is thefounder of Kyocera (an electronics, telecommunications, and ceramics hardware
company) and DDI (currently KDDI, a telecommunications company), and iscurrently the honorary chairman of Kyocera and also Japan Airlines (JAL). His
philosophy and actions are respected and considered by many as the “goldstandard” management philosophy and moreover as the life philosophy to befollowed. He stood up to the challenge of reviving JAL from bankruptcy in
February 2010, without any compensation, and successfully relisted JAL on theTokyo Stock Exchange in just 2 years and 8 months after the company filed forbankruptcy.
“So how amazing was the resurrection of JAL? I won’t go into details, butwhen a big company like JAL goes bankrupt, many people lose their jobs andthere is a profound impact on society as a whole. So the people involved utilized
the Corporate Rehabilitation Law to try and rebuild the organization under the
court-supervised restructuring.”“But, using this Rehabilitation Law doesn’t automatically mean the bankrupt
company can be revived. Since 1962, in Japan 138 companies have attempted
to recover under this Law. Nearly half of the companies (59) failed to comethrough and perished. While recovery is hard enough to achieve, relisting thecompany’s stock is an even greater challenge.”“To ‘list’ means that the company stock may be traded at a particular Stock
Exchange. It is extremely difficult for a once-bankrupt company to relist. Of the
138 companies that filed for bankruptcy, only 9 accomplished this feat, and theshortest time it took any of the other companies to relist was seven years. Mr.
Inamori accomplished the relisting in only 2 years and 8 months.”
This explanation gave the class at least a small sense that, “He had
accomplished something great.” So, how did Mr. Inamori achieve the great featof resurrecting JAL? Now that is the important part.

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“The key to JAL’s revitalization was the mandatory ‘Leadership Training’ forthe 52 senior executives, which was held from June to July after the
Rehabilitation Law was applied. I have heard that some of the executives
objected to the training. But Mr. Inamori was convinced that this training wasindispensable to rebuilding JAL. He appealed the importance of having a ‘Right
Mental Attitude’ to all the JAL executives in his own sincere and passionate
words.
“Some executives came to the training with an attitude of, ‘That is business
management 101! You don’t need to tell us that!’ but when Mr. Inamori started
his lecture, everyone was mesmerized. In the end, they all realized that‘knowing something’ and ‘doing something’ are totally separate things.”
The Two Social Philosophies That Influence Our Thinking
How does a “Right Mental Attitude” lead to business success? This still mustbe hard to grasp for a lot of people. There are times when a business succeeds
without “making” one’s thinking better. An innovative idea and some ability,
ambition, and funds will, in most cases, lead to an achievement. Maybe tosustain the success will require a “Right Mental Attitude”, but in our hearts,
many of us are actually a bit skeptical. Some of us even resist the word “Right
Attitude” when we hear it. That is because the Japanese people have beenraised on “education that belittles right mental attitude” in the modern times
since the end of World War II.
If I were asked to name social philosophies that have greatly influence present
day society, I would say, “libertarianism” and “new liberalism”. Libertarianism
states, “Leave everything to the market and everyone will receive what they
deserve.” On the contrary, new liberalism states that “leaving everything tomarket does not always bring justice.” These two philosophies seem like oil andwater; they would never accept each other. But in our post-war education, we
have unconsciously studied these two social philosophies repeatedly.
Interestingly, these conflicting philosophies have a single underline: thatwithout question, “Right Mental Attitude” should not be forced onto other people”
and ”whether something is good or bad should be left for each person to decide.”That is the reason why the post-war generations unknowingly are repulsed bywords like, “It’s important to have a Right Mental Attitude.”
But is a “Right Mental Attitude” really that repulsive? The very first thing Mr.
Inamori touched on at the executive training was “The Results of Work and Life”.
The participants of the executive training had a massive shock when they heard,“The most influential factor in the outcome is one’s ‘Mental Attitude’.”-5-JAL boasted top-notch employees before its bankruptcy. There were
ambitious executives and hard-working recruits. There was plenty of “ability”
and “effort” required for success, and they all prided themselves in theircapabilities.
Consequently, no matter how close to bankruptcy their company was, theemployees demanded “recognition of their talent and effort” and “appropriatecompensation” from the management. On top of that, the various unions ofpilots, flight attendants, maintenance, ground crews, etc. all fought with eachother for better pay and work conditions through their own union. To overcome
the situation, a long list of senior managers drafted countless management
policies and plans to rebuild the organization. All of these failed.
How did the government and the political parties who demanded fundamental
reform and drew up rehabilitation plans from outside the company do? As
expected, none of the politicians or governmental organizations pursued a“Right Mental Attitude” or its implementation. All they did was rewrite goal
figures into the rehabilitation drafts.
That is to say, all they did was argue over the figures: the number of personnel
to let go, the number of fuel-consuming jumbo jets to cut, the number ofsmaller aircraft to purchase, the number of low-yielding routes to discontinue,
the amount of interest-bearing debts to cut, et cetera. It may be a bit harsh,
but I would have to say, they were “all talk and no action”.
As a result, Japan Airlines sank deeper into debt and collapsed completely.
Amidst this chaos, only Mr. Inamori insisted on the necessity of a “Right Mental
Attitude” and put himself on the line to revive JAL. I will explain his formula forsuccess, “the Results of Life and Work,” properly in chapter one, but the mainidea is that the “result” depends greatly on the quality of “attitude”. This factor,
that the prior two social philosophies ignored completely, changed the fate ofgiant organization called JAL. Should we not look straight into this reality, andlearn from Inamori Philosophy as a social philosophy?
Of course, many companies and business leaders have already recognized thesignificance of Japan Airline’s revival and are learning from both Mr. Inamori’s“management philosophy” and “life philosophy”. But his philosophy andachievements encompass more than just “management philosophy and life
philosophy”. Inamori Philosophy supplements the limits of western
libertarianism and new liberalism and goes on to offer a whole new way of
thinking.

-6-This may be improper to say, but the bankruptcy and revival of JAL was a
once-in-a-century “invaluable social experiment”. As a witness to this incident,
I would like to get to the core of Inamori Social Philosophy that proclaims “theimportance of mental attitude” in this book.
Dialogues with High School Students
The main purpose of this book is to deliver Inamori Philosophy to the present
challenged society and to shed a guiding light towards a new future. My goal is
to convince not only companies and business leaders, but really to reachyounger generations and have them be tweeting and buzzing about thisvaluable philosophy.
In order to relate especially to younger readers, I have brought in dialogues
with high school girls often in this book. As I’ve mentioned before, this was
inspired by the special lectures I gave at a girls’ high school in Tokyo. I havegiven lectures every year since I was invited a few years ago. The attendingclass was an advanced class of about 30 seniors, all with overseas student
exchange program experience.
I had lectured college students before, and I thought I knew how to go aboutit, but to talk to high schoolers - all girls, with English proficiency - it was quite
a different story. I was concerned. “Could I convey the greatness of Inamori
Philosophy and his accomplishments successfully to them?” “Might I blunderand sound too rigid and stiff?” I almost declined the offer. But, “If I could
understand, even partially, their interests and perceptions, it would be avaluable lesson for me.” I finally decided to accept the challenge. Consequently,
although some may say I am gravely mistaken, I feel I can now comprehend
the interests and perceptions of the younger generation.
For the above reasons, this book evolved around my dialogues with highschool students. First, though, I would like to apologize that I have added
some fictional conversations along the way. The actual lectures at the highschool were only 60 minutes, very short lectures. If I were to put down only
the actual conversations, the publication would have been about two thirds ofthe current volume. So I needed to supply fictional conversations based on“How I would have further explained things to these girls and how I believe
they would have reacted based on their interests and perceptions.” I hopethese dialogues motivate younger generations to read on and enjoy learning
more about Inamori Philosophy.

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Chapter 1

Utilitarianism as a Social Philosophy

Mr. Inamori’s philosophy and lessons based upon his practices are usuallyviewed as a management philosophy or a life philosophy. However, in thisbook the “social” aspect of his philosophy is spotlighted. Why?
First and foremost, it is because his teachings encompass how a just society
should be. Not many people have realized this, but his philosophy reaches therealm of an all-around “social” philosophy. That being the main reason, thisbook also focuses on the social aspect of Inamori Philosophy because thesocial issues are the most familiar to the younger generations.
For example, most high school students have never managed a company.
They have lived less than two decades. To lecture business management orlife philosophy to them would be foolish. Without something they could relate
to, the core and the heart of the philosophy would be lost. Therefore, I
decided to introduce Inamori Philosophy through familiar social, ethical,
political, and economic issues that they all learn in high school.
1. Logical Results of WorkHow is Inamori Philosophy a social philosophy? The essence is represented
in the “Logical Results of Work and Life” that Mr. Inamori proclaims.1 I would
like to call it the “Results of Work” for short.
The “Results of Work” in the formula refers to many things, but in our case,we will say it is all the “earnings” a person receives for a particular work. Thismay be “income” from a job, or “material” from one’s personal trade, or it
may be “trust” from associates.
Whatever the form, these things represent the useful “earnings” to a person
in life. Strictly speaking, Mr. Inamori’s definition is a little different, but we will
use this as our definition of the “Results of Work” for now. Simplified this way,the “Results of Work” actually means “Formula for how ‘earnings’ are
distributed in society.”
Before we go further, let me explain a bit more about Mr. Inamori’s formulafor the “Results of Work”. The formula is as follows:
RESULTS OF WORK =1MENTAL ATTITUDE ×

EFFORT × ABILITY

Kazuo Inamori, Kokoro wo Takameru, Keiei wo Nobasu, PHP 2004, pp.26-27.

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Mr. Inamori rates effort and ability in 1 ~ 100, but we will simplify it to 1 ~10. “Ability” means: competence or aptitude, physical characteristics,
knowledge and skills learned in life. It would be natural to think: “The higher
the ability, the better”, but Mr. Inamori thinks otherwise. He says: “Ability on
its own does not determine the Results of Work; the results are determined by
the multiplication of ‘effort’ and ‘ability’.”Then, what is “effort”? It implies finding meaning to a goal, actively
pursuing it, never giving up, and having the determination to achieve that
goal. Inamori Philosophy emphasizes that even if one’s “ability” is a 10, if“effort” remains a 2, then the resulting product will only be a 20 (= 10 × 2);
whereas even if one’s “ability” is a 6, if there is a 10 “effort” - that is if one ispersistent and earnest and fully devoted - then the product mounts to be a
60.
The most distinctive characteristic of Mr. Inamori’s formula is that it brings in
the “mental attitude” variable to the formula and that it defines the Results ofWork as a product of the three variables of “effort”, “ability”, and the “mental
attitude”. Interestingly, “effort” and “ability” are rated only between 1 through
10 whereas the “mental attitude” is rated between - 10 through + 10.
The reason “mental attitude” has a rating range from negative 10 to positive
10 is, naturally, because there are negative or “wrong mental attitudes” andpositive or “right mental attitudes”. If one acts on “wrong mental attitudes”,
even when the product of “effort × ability” is a 60, multiplying the negative“mental attitude” number would yield a negative number for the “Results ofWork”. On the other hand, this formula supports the possibility of an impressive
outcome even if one’s “ability” is mediocre (6, for example), as long as that
person has a strong “effort” (say, a 10) and a “right mental attitude” (a positive
5, for instance), resulting in 6 × 10 × positive 5 = positive 300.
We will examine the validity of the “Results of Work” formula later in Chapter
5, but I would like to emphasize first that this formula actually shows “how thesociety should be”. That is, this formula represents the very core of what social
philosophy strives to do. Furthermore, I would like to suggest that this formula
may make the two orthodox Western social philosophies to repent.
2. The Issues Discussed in Social Philosophy
What are the issues discussed in social philosophy? I asked the following
question at the lecture course I taught and examined the answers with thestudents.

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“What sort of society would you like to live in?”To this question, the students answered, “A peaceful society, a safe society,a society we can feel happy in.”
“Then, what is necessary for such society to exist?”
Various things came up as answers, but the popular ones were “freedom”,“fairness”, and “prosperity”. In other words, the students thought therequirements were “that the ‘freedom’ of the people is protected, ‘justice’(fairness) to all people is realized, and that ‘prosperity’ could be felt by all
members of the society where there is (no poverty)”.
“The necessities of a happy society” have always been, in actuality, the focus
of social philosophy - and the students came up with “freedom, justice, andprosperity”.
Ideologies and philosophies dealing with these issues date back to theancient Greek times of Plato and Aristotle. But, keeping in mind that thepresent-day society is mainly influenced by the social philosophies of the late
Middle Ages in Europe, we shall look only as far back as that time in history.
3. Late Middle Ages and the Beginning of Philosophical Explorations
Europe started exploring new ideas at the end of the Middle Ages. During
the Middle Ages, the leaders of society - kings, lords, and religious leaders defined the right way of life for their subjects and followers: how to serve,
what occupation to take up, and how to live. These things were ordered by
the leaders or were followed in the form of systematic “traditions, customs,
and teachings”.
To put it straight, there was no individual freedom. Especially for the
subjects, no “freedom” to break the master-subject relationships at will waspresent. In that regard, the Middle Ages were the dark ages with no freedom.
Interestingly, though, most of the people did not especially resist the “orders”
or the “traditions, customs, and teachings”. They knew tacitly, that byfollowing these “orders” the society would keep its ORDER, peace, andbalance.
Such thoughts were established in Middle Age Europe, but with the following
Renaissance and the Age of Exploration, the social ORDER swayed. Then, theReformation in the late Middle Ages dismantled the Catholic Church, the civil
revolutions after the 17th century toppled feudalism, and at the end, even- 10 -

kings and queens were executed. To behead kings - the pinnacle of the social
pyramid - meant breaking off the source of “ORDER” established in Middle Age
Europe at the hands of the people themselves.
Now, it was not a “happily ever after” story. When the Middle Ages weredenied and the old order was destroyed”, as long as people lived, naturally, a
new order was needed. So after the old was destroyed, people seriously
began discussing what kind of society should be established and how should
the new order be formed. In other words, with the end of the Middle Ages,
emerged a great discussion around what the “Right Society” should be.
People are, by nature, free. God gave each of us freedom to do God’s will on
earth. So, we all have the “natural right” to “freedom”. But, if we were given
complete “freedom” to do as we pleased, then the society would fall intochaos.
The strong would dominate the weak, and again the “freedom” of thedominated would be taken away. Fighting would arise among the strong, andboth sides would lose many lives and fortune. That is definitely NOT a “Right”
situation.
To avoid such chaos, people should give up a part of “freedom” dealing with“right to govern” to the leaders or representatives; this was the new theory
insisted by Social Contract Theorists like Thomas Hobbes (1588-1679) andJohn Locke (1632-1704).
Moral philosophers also insisted on their own theories. Humans, by nature,
have abilities to “sympathize” and “be rational”. We can predict if an action
would hurt another person or make them happy before we act. People could
put themselves in another’s place and decide what is best to do or not to do.
This ability is God given. God also carefully placed “Laws of Nature” in thisworld so that with our abilities, social “order” could be achieved. So, if we allfollow our rationale and morals, everything will work out. The father of
economics, Adam Smith (1723-1790) states that.
4. Utilitarianism Emerges“You have learned about philosophers such as Hobbs, Locke, and Smith inyour Social Studies classes. What they were theorizing about, ultimately, was
how they could establish a new order in society.”“Unfortunately, their theories must have been too complicated for the- 11 -

common people; in the end, very simple and familiar concepts were acceptedin the society. The people wanted simple ideas, not complicated theories. They
also wanted a concept that approved of what they were actually doing.”“You may have heard of the social concept called ‘utilitarianism’, which states,
One may strive freely for one’s happiness and pleasure, and one may avoid or
lessen things that cause one pain.’ Of course, there was the condition that one
may not infringe on other people’s freedom, but the small details wereoverridden by the captivating concept that justified the freedom to strive for
one’s own happiness.”“Let me elaborate and emphasize. Utilitarianism allowed the people to decide
for themselves what their ‘happiness’ encompassed. Which means ‘what is right’
was no longer ordained by the church or traditions or customs for people tofollow. This is why the people welcomed utilitarianism with a cheer.”In this way, utilitarianism became one of the leading social philosophies
defining modern times. It declared, to gain happiness and lessen pain, and to
decide what one’s happiness is, are all a ‘logically correct’ way of living forindividuals and for society as a whole.
Now, under this social philosophy, the “desirable policy” of a country or agovernment would be the one that provides the most happiness for its people.
Supposing the contentment of a citizen could be measured, policies thatmaximize the total contentment of all its citizens would, therefore, be the mostdesirable. This is the axiom “greatest happiness of the greatest number ofpeople is the measure of right and wrong” by Jeremy Bentham (1748-1832), a
regular in Social Studies textbooks.
But this theory “greatest happiness of the greatest number” - that so
fascinated the people - met a pitfall, and was deemed insufficient as a founding
principle of society. To illustrate this pitfall, I presented an example to thestudents.
5. The Pitfalls of Utilitarianism“Let us say, there was a survey of contentment at your school last year. And
let us say that the result showed, out of 300 points, the student contentment
was 100 points. It was not high. So the school opened a new cafeteria that all
students could use. As a result, this year’s survey yielded 200 points. Looking
at this result, do you think opening the new cafeteria was the right action to
take?”- 12 -

To this question, everyone answered, “Yes, it was right.” They all supported
this, simply because the evaluation result doubled from 100 to 200 points.
Namely, they judged it from the utilitarian standpoint.
After all the students answered, I put forth another, quite an unrealistic
situation and asked a question. I believed this was the most obvious way to
discuss ethics.
“Now, then, let us just say for instance, that the school decided to pick one
random student and lock the student up for a year in a room somewhere in theschool. Food and the most minimal needs for survival are provided to thestudent, but nothing more.”“What!? How could the school do that?!!” “No way!” “Absurd!!”
I smiled at their outrage, but continued, “This is just a hypothesis. Please
don’t react just yet, and hear me out.”“Of course, that confined student would feel pain. But even after deducting
for that student’s pain, the contentment of the rest of the students summed up
to be a whopping 270 points! Way over the last evaluation result of 200 points.
Now, in this case, would you all agree to the confinement of a random student?”
Nobody agreed to that. Everyone was opposed. The students decided “that is
unacceptable”, even though the contentment evaluation result soared. Theirreason being, “The person picked would be devastated.” Although they didn’t
say it clearly, there could be some students, who imagined the worst casescenario of them being picked.
The true reason for their opposition is not certain, but the students decided
intuitively that, “That is unacceptable.” Their decision shows the limits of thelogic of utilitarianism. That is, utilitarian theory holds within it a cruelty that
legitimizes the thought that “If the contentment of the majority (unpicked
students) rises, then the discontentment of the minority (picked student) could
be negated.” Furthermore, the theory considers only the TOTAL happiness(welfare) of the society as a whole, and neglects “how that happiness is
distributed in the society (school)”.
Here lies the pitfall of the utilitarian theory. But I certainly don’t mean to say,“All aspects of utilitarianism are insufficient and no one should follow it. No. We
all employ utilitarian ways of thinking on a daily basis.”
As confirmation, I gave the following example to sum up the talk on- 13 -

utilitarianism.
“When you shop, most likely you would apply the utilitarian theory. Whether
you buy clothes, snacks, or concert tickets, when you spend money, you would
probably compare the money spent (discontent) to the contentment achievedby spending that money, and decide on a purchase with the most contentment
gained.”“This way of thinking is not only practiced by you. All business managers andgovernment officials also apply this way of thinking when making decisions. For
example, a business manager, deciding whether to construct a new factory ornot, would compare the construction costs to the increase of future profits. If
the profits are calculated to be much higher, the manager would decide to gowith the construction of the new factory. This is utilitarian thinking.”“So we, on a daily basis, in various situations, and in various levels, repeatedly
make decisions in a utilitarian manner. Therefore, we cannot deny utilitarianism
in its entirety. But, please remember, that utilitarianism is not a perfect theory.”- 14 -

Chapter 2
How Libertarianism Overcomesthe Limitations of Utilitarianism
Modern society was not foolish. The philosophers began further explorations
to overcome the limits of utilitarianism. The next pioneering theory became
known as “libertarianism”.
To recap, the shortfall of utilitarianism was that it required sacrificing thefreedom of the minority in order to gain the contentment of the majority.
Therefore, to overcome the limits of utilitarianism, a better social philosophy
needed to regard not only the freedom and welfare of the majority but also
those of the minority, as well as to define “how income and wealth (happinessand contentment) are distributed in society”. Libertarianism stood up to thechallenge with a clear explanation.
1. Libertarian Explanations“This may not interest you much, but let me just name the two major
libertarian philosophers here. One is Friedrich Hayek (1899-1992) an economic
philosopher, and the other, Robert Nozick (1938-2002) a political philosopher. I
will not dwell on each one’s theory, but introduce you only to their sharedvisions.”“The essence of their view is this: the government should intervene as little
as possible, and transactions between people should be left to the ‘market’. The‘market’ refers to a place where products and services are sold or bought. So if
you purchase something at a store, the store would be an example of a market.
Your school, where you pay tuition to get educational services, would also be amarket.”“Libertarianism explained that everyone’s ‘freedom’ would be protected bythe ‘market’, not by ‘government’, because all people - both the majority andthe minority - could exchange goods and services by their own free will in themarket. If one wants to purchase, she purchases. If one wants to sell, he sells.
Libertarianism advocated that all people are given equal freedom to maketransactions that benefit them the most.”“There is one more, very important point - the concept that ‘the market’ also
brings ‘justice’. Utilitarianism ignored the ways in which happiness is distributed
in a society. The ‘Greatest happiness of the greatest number’ of people aimed
only to increase total happiness, if you all remember. On the other hand,libertarianism stated that as long as the government does not intervene inpeople’s economic activities, each person will be valued for his or her own efforts,- 15 -

and as a result, ‘fair distribution’ will be achieved. In technical terms, thisconcept is called the ‘distributive justice’. Please keep that word in mind.”“Now, do you think your efforts are rightfully valued and rewarded in oursociety mostly?” To this question, the students answered, “Yes,” trustingly.
“Why do you think so?”To this question, they virtuously replied, “Because I think the people who put
in hard work actually do get rewarded…,” and ”People try hard because they
believe the effort gets rewarded, like in sports.”“That is true. Take tennis players like Novak Djokovic and Kei Nishikori (aworld ranked Japanese tennis player), we can say they are highly valued andrewarded in the world today because they have put in a lot of effort.” Saying
so, I was warmed by the thought of my students being so pure and virtuous.
2. The Difference Between Laissez-Faire and Libertarianism
I must make clear - libertarianism is NOT a simple “laissez-faire” philosophy.
Libertarianism did NOT say, “Everything will work out if the government stayedout,” or “Let everyone do as they please.”“Laissez-faire economics” of the past proclaimed, if one acted freely to gain
one’s own profits, that person’s efforts will definitely be rewarded. The
businesses of the time interpreted laissez-faire to their own liking and justified
some very selfish actions.
They conspired within their industries to raise product prices, raised the bar
for new competitors to enter, and bribed officials to obtain permits. They
considered these actions to be “free economic activities”.
If such activities are tolerated, the hard working honest people will end up
with the short end of the stick. If bribing is considered as one’s “freedom”, andsports players bribed umpires and opposing teams, honest players would
neither be valued rightfully nor be rewarded fairly. So, another oflibertarianism’s great endeavors was to amend the selfish interpretations of“freedom”.
“Libertarianism did not say, ‘Hands off, governments!’ Rather, it defined clearly
what governments’ role should be. Some of the most important tasks agovernment should accomplish were these: to make the market a level playing
field, to encourage free competition, and to eliminate anything that discourages- 16 -

competition.”“If these government tasks are achieved - that is, if the market functions as
it should - then the people will act and trade freely to gain profits. If there is aneutral umpire, everyone will work hard and honestly. As a result, both the
majority and the minority will be rewarded for their efforts fairly.”“Eventually, when the people start to believe that ‘freedom’ and ‘justice orfairness’ are realized, they would work harder and put more effort into theirwork. When all people start to work harder, society would be filled with better
products that are more affordable. In short, the society will ‘prosper.’”“I have just mentioned freedom, justice and fairness, and prosperity. Now,
please think back. I asked you at the beginning of the lecture, ‘What kind ofsociety would you like to live in?’ Do you remember what your answers were?”“You had said, I think, a peaceful society, a safe society, and a society you
can feel happy in. Correct? And I had asked, ‘What is necessary for suchsociety to exist?’ There were many elements that came up, but the popular
ones were ‘freedom’, ‘fairness’, and ‘prosperity’, if I remember correctly.”
This lead was enough for my students to realize where I was going with
this.
“Oh, I see.” “Then, that’s the connection.”
The students understood that libertarianism stood clearly on those threeissues; that this philosophy aimed to “protect the ‘freedom’ of the people,
realize ‘justice’ (fairness) for all, and bring ‘prosperity’ to the society”.
3. Libertarianism in a Formula
So, in order to overcome the limits of utilitarianism, and to make modifications
to the radical former laissez-faire economics, libertarianism advocated that“people’s trade should be entrusted to the market”, “everyone’s ability andcreativity will be rewarded rightfully in the market”, and “government musteliminate anything that discourages competition”.
But, in comparison to Inamori Philosophy, neither libertarianism nor
utilitarianism defined certain values as “right”. They thought imposing certain
values on to others would go against the thought of “freedom”.
Let us review the characteristics of libertarianism here for a moment. Using- 17 -

the same format as Inamori’s “Formula for the Result of Work”, thecharacteristics would be represented as follows:
RESULTS OF WORK =EFFORT× ABILITY

Preconditions:
1) Government collects the minimal tax necessary for defense and peace.
2) Government eliminates anything that discourages market competition.

In other words, Libertarianism states the Results of Work is decided only by
the product of “EFFORT” and “ABILITY”. For example, say there is a person witha 7 ABILITY” but a low motivation of only 2 EFFORT. The person is competentbut unmotivated. In that case, that person’s income will be the resulting productof 14.
On the other hand, say there is a person with not so much ABILITY of 4, but
is very highly motivated - with EFFORT of 9, for example. In this case, thedistribution of income from society would be 36. Very roughly said, this would
be the libertarian explanation of the “formula for the Results of Work”. Of course,
this formula has a couple of preconditions, but the core of the theory remains
the same; if one exerts one’s ability and effort freely, the market would reward
the results rightfully.
After writing the libertarianism formula on the blackboard, I asked thestudents.
“You have seen Mr. Inamori’s ‘formula for the Results of Work’ already - what
was different in that formula from this one on the board?” That was an easyquestion for them.
“It’s whether there is the ‘MENTAL ATTITUDE’ variable or not,” one student
answered promptly.
Another student added, “I think the formula should include ‘THE MENTAL
ATTITUDE’ variable.”“You think Mr. Inamori’s formula is better. Okay, thank you. Does everybody
else feel the same way?” I asked.
No particular comments were made, so I confirmed, “So, that would mean
this class does not support libertarian thinking.”
With my comment, one student raised a hand hesitantly and said, “I don’t- 18 -

think the ‘MENTAL ATTITUDE variable is really necessary in the formula.”“Very interesting. Thank you for being brave and sharing your thoughts.
Would you be kind enough to share some more and tell us why you think so?”“I’m not sure, but I feel it’s really hard to decide how to judge which ‘MENTAL
ATTITUDE’ is right and which is not. People may have different ideas of what isright and what is wrong…,” she said modestly.
“I see. A wonderful point made. That is likely what the libertarians thought,
too. If everyone had different ways of judging what is right and wrong, thesociety would suffer from inconsistency. And the formula for the Results of Workcannot depend on an inconsistent judgement.”“Then, what if someone decides ‘whether a mental attitude is right or wrong’to keep the judgement consistent? Have someone in the society decide what isright and wrong?.”
The students reacted in a flash. “There would be no freedom in such society!”“Justice may be twisted!” “Even prosperity may be lost!”
This was exactly the reaction of the libertarians. If a certain person or a groupwere to decide the right or wrong “MENTAL ATTITUDE”, there would be much
power concentrated in the hands of that person or his or her group. If a certain
person was to decide and advocate one value to be “good”, dictatorship by that
person would be evident and that society would lose freedom and justice, as
was the case in the past in communist countries. That is the reason why there
is no “MENTAL ATTITUDE” variable in the libertarian formula.
4. Trade Based on Free Will?
Libertarianism stated that left to trade on “free will”, all efforts will be
rewarded fairly in the market, “distributive justice” will be realized, and poverty
will diminish. It stated, “freedom”, “justice”, and “prosperity” will all beaccomplished. Is that really true? We need to dig deeper.
“Do you not feel odd about the condition ‘trade on free will’? Are all market
traders really acting on free will?”
The class remained silent. No thoughts were voiced. The students must havethought, “Everyone acts and trades on free will in society.” So I presented thefollowing point.

- 19 -

“In order for trade on free will to actually take place, everyone concerned
must stand on equal grounds. If one side stands superior, that side could push
the inferior side to an unfair trade agreement. The inferior side, in a tightsituation, would have to agree to the proposed terms no matter how
unreasonable. Generally, these trades would be far from being based on free
will.”
Granted, such unbalanced trade cases may be exceptions and irrelevant insociety. At the beginning of modern society right after the Middle Ages, alltraders might have acted independently. They may have traded freely - one
could have made carpets and the other, bread or vegetables - and they may
have traded mostly on equal grounds.
Yet soon, the income and power of the traders started to differ. One becamerich and another, poor. Actively invested companies grew while the employedindividuals became vulnerable. As a result, the weak individuals were forced toaccept the terms presented by the powerful, no matter how unsatisfactory thoseterms.
You may think that in modern society employed individuals are not so weak,since labor-related laws and regulations protect their interests. Even if that weretrue, the whole concept of the employed is ever-changing. There are full-time,
regular employees and other, non-regular employees.
“You may hear often nowadays, that once you fall off of the career path of
regular employment, it is really hard to get back on track. As for education, thewealthy have access to prep schools and private tutors while the poor do not.
And as a result, children from wealthy families are more likely to attend
prominent universities and go on to well known companies.”“I do not know whether your families are wealthy, but having had theopportunities to be foreign exchange students like you have, you would certainly
count as being educationally privileged, I think. Maybe the reason why you do
not feel any strangeness hearing ‘trade on free will’ is because you have beenvery much blessed in life. It is a possibility.”
The weak, or the “socially vulnerable”, tend to accept harsh terms andunreasonable demands in order to survive, more so if that condition was the
only option for survival. As long as this kind of situations exists, purely equal
trade as presumed in libertarianism could not exist either.
French economist Thomas Piketty (1971-Present) says, viewed over a longtime span, the gap between the wealthy and the poor continues to grow. He- 20 -

supported this using data from the past 300 years. If wealth continues toconcentrate as Piketty says, that means the socially vulnerable people are being
forced into a “restricted, non-free” life.
People would not call a society with concentrated wealth a “just” society to
begin with. An economically unbalanced society would eventually topple. History
has seen this happen many times. If our society is heading towards that
direction, libertarianism would not be able to protect “freedom”, “justice”, or“prosperity” as it promised.
5. Result Oriented Society
There is one more, big flaw in libertarianism. That flaw is the risk of misuseof the libertarian formula in society. Originally, the libertarian formula wasproposed as the “ideal” of how society should be. But once the formula defines
the Results of Work as the product of “EFFORT × ABILITY”, the wealthy may
insist that, “The less fortunate all lack effort and ability.”“Effort and ability are certainly important, but please everyone, imagine this- a society that points at the less fortunate and says it is completely their own
fault. Would you like to live in such society? Wouldn’t you think it’s a very coldand stressful society?”“The reason why I say this is because life and society throw many
coincidences at you. No matter how earnestly you work and live, there could be
an airplane accident for example, and your parents could perish suddenly one
day. An unfortunate accident could befall you that had nothing to do with youractions. If such misfortunes were said to be due to your lack of effort or ability- that would be terrible, don’t you think? So that is the flaw of libertarianism.”
Of course, libertarianism is not flawed entirely, just like utilitarianism was notentirely bad. Modern society has flourished a lot owing to many activities in themarket. In that sense, no one can deny the entire libertarian concept. Yet, weneed to keep in mind that libertarianism needs “equal grounds for all” to workout, and also that it could possibly create a “cold society” for the unfortunate.

- 21 -

Chapter 3

Keynes’ Ideal Society

Libertarianism was not perfect. The shortfall, basically, was in its lack ofconsideration for the socially vulnerable. This shortfall was conquered by what
we now call the “new liberalism”. There are many philosophers who are newliberals, and therefore many versions of the theory, but the core claims are moreor less the same.
Those core claims are, “not everything should be left to the market”,“governments should act as adjustors or coordinators”, and “governments
should protect the equality and the civilized life of the socially vulnerable”.
1. New Liberalism in a Formula
I have already presented Mr. Inamori’s “formula for the logical Results ofWork”, and then the libertarianism formula using the same format in priorchapters. In this chapter and the next, we will go over the main theories of newliberalism. As an overview, I would like to present the characteristics of newliberalism in a similar formula format.
Simplified, maybe to a fault, new liberalism is a theory that does not allow for
the Results of “EFFORT × ABILITY” to wholly become the income of eachindividual. In other words, it is a theory where the government is required tocompensate for the results of each individual’s efforts and to collect taxes andthen redistribute wealth from the viewpoint of overall public welfare.
“You all may know that governments usually tax individuals according toincome, using higher tax rates for higher income. It is called graduated orprogressive taxation. Individuals with higher income and individuals withgreater inheritance are taxed at a higher rate.”“The collected taxes are then ‘redistributed’ for the sake of public well-being
and social welfare. By ‘redistributed’, it means the collected taxes are distributedby the government back to the citizens in the form of social aid, financial support,
or public assistance. Such governmental acts include creating opportunities for
employment and education for the socially vulnerable.”“Let me explain a little about ‘educational opportunities’. You are now
attending a private high school, and I think the tuition here is a little bit morethan most other public high schools. So, it is difficult to attend here unless there
is enough family income. Thank your parents! Tuition is much more expensive
than you might think. Your parents are working hard to pay the tuition for yourfuture’s sake.”- 22 -

“Of course, even if family income is limited, gifted students like you may getscholarships from the school. But a school cannot give all its students
scholarships for financial reasons. Hence, private high school tuitions tend to be
expensive.”
With that said, I asked, “What would happen if there are only private highschools like your school here?” and answered myself.
“The answer is, if there were only private high schools, there would be a lotof students who could not go on to attend high school. There would be limited‘educational opportunities’. Such a society is undesirable, so the (local)
governments use the tax money to set up affordable public high schools whereanyone can receive educational services. Government scholarships are also
provided to give equal ‘educational opportunities’ to its people.”
With taxation and redistribution explained, I wrapped up by saying, “We willcall taxation and redistribution by the government ‘GOVERNMENTCOMPENSATION,” and presented the new liberalism “formula” as shown below.
RESULTS OF WORK =GOVERNMENT COMPENSATION×

EFFORT× ABILITY

Preconditions:
1) Government collects progressive taxes according to income or wealth.
2) Government provides employment & educational opportunities and welfare.
3) Government enacts laws to protect equal opportunities for all.

Please note here that there is no “Mental Attitude” variable in this formulaeither. We will go into this deeper later, but that is the ultimate difference
between new liberalism and Inamori Philosophy. The formula represents a very
general definition, but we shall consider this as we look at the theories of thetwo prominent new liberals.
2. Keynes’ Basic Questions
One of the most influential new liberals was an English economist John
Maynard Keynes (1883-1946). I would like to avoid any misunderstandings bystressing first that Keynes did not oppose free competition. His theory is
characterized by his belief that “government compensation are needed” only
when the market fails to function properly.
He did not actually say, “Governments must regulate to save the sociallyvulnerable.” But if you follow his approach on “effective demand”, you would- 23 -

reach the conclusion that “without improving the situations of the sociallyvulnerable or disadvantaged, before long the economy would stagnate andsuffer a serious slump”. In that regard, Keynes is categorized with the newliberals.
Before the times of Keynes, classical economics was the mainstream in society.
Hence, when unemployment rose, proponents of classical economics insisted:“unemployment is not a big problem”, “government does not need to do
anything about it”, and “problems will solve themselves, since the labor market
naturally and eventually settles at the ideal wage level”. They all believed thatthe economy would “balance” itself out.
The reason companies do not employ workers is because they think salaries
are too expensive. When the unemployment rate rises, naturally, the market
lowers the demand for salary. The unemployed would begin to accept “lower
standards” as reasonable. Once salary standards are low enough, companies,
in turn, would reconsider and start hiring.
Classical economists believed this to be true, and claimed that“unemployment would resolve itself”. But unemployment was not “a temporary
imbalance” as they had believed. The employment situation got worse andworse.
Keynes went back to the basics and analyzed the problem systematically,
coming to the conclusion that the reasons for chronic unemployment was that“the production of businesses were not active enough” and “the demand fromsociety was not enough to stimulate production”. With that understanding,Keynes explained, with enough demand (actual monetary expenditure),industrial producers would become more active, which would create a positive
cycle, and unemployment problems would be solved.
Before we go any further, let us take a moment to understand how a national
economy works, using a general picture of economic circulation.
3. Flow of a Nation’s Economy“You may think economic activities are hard to understand, but they are justordinary occurrences in society, and actually quite easy to understand.” With
that in mind, I gave “a general picture of economy” that Keynes had
contemplated.
“Economic activities are, in other words, the production of goods. Whenbusinesses produce goods, or when people work to produce goods at some- 24 -

factory, two things are created. What do you think those are?” I asked, but
answered myself.
“Those two things are ‘goods’ and ‘income’ (CHART 1). Let’s say you work at
a factory. Naturally, goods are made at that factory. On top of that, you, theworkers, would be paid by the factory. That is income. Let me write that on theboard.”
CHART 1GOODS
PRODUCTION
INCOME“These GOODS can further be divided into ‘investment goods’ and‘consumption goods’. ‘Investment goods’ are goods purchased by businesses
such as machinery, and factories. For example, the machine tools and industrial
robots in factories, production lines, materials like cement and steel for building
bridges and highways, and construction machinery are all investment goods.”“It may be easier to think of them as goods that consumers do not purchase.
Do any of you have welding robots in your room? Or bags of cement? No sucheccentrics, right? That is because usually, those goods are not for consumers.”“On the other hand, ‘consumption goods’ are goods purchased by consumers
to live, or to make living more comfortable. For example, food and clothes,houses, cars, air conditioners, TV, cellular phones, and music players are all
consumption goods.”
I added the two GOODS on to the board (CHART 2).
“Just like the GOODS, INCOME is also divided into two. Those are‘consumption’ and ‘savings’. When a person gets paid, they can either consume
or save the income (CHART 3). The money is used or kept, in other words.
Consumption is the used portion, and savings is the kept portion. Usually, thekept portion is deposited at a financial institution, so we call those savings, but
in economics, even if you do not deposit the money at a bank, it is called‘savings’. Whatever is kept for future spending is called savings.”“Let us say for instance, that each of you deposit your money at a bank. The
bank would not just leave your money in the vault, because money sitting in
the vault would not create any profit. So the bank would gather all your money- 25 -

together and lend it to a company, for example.”
CHART 2INVESTMENT GOODSGOODSCONSUMPTION GOODSPRODUCTION

INCOME“What would the company do with the borrowed money? The company would
not just leave it in cash. Usually, they borrow money in order to expand
productivity.”
CHART 3INVESTMENT GOODSGOODSCONSUMPTION GOODSPRODUCTIONCONSUMPTIONINCOMESAVINGS“Between the two GOODS we talked about, the GOODS used to expand
productivity are INVESTMENT GOODS - not CONSUMPTION GOODS. Whichmeans the company would purchase investment goods such as machine tools,
industrial robots, and construction machinery with the borrowed money.”“On the other hand, let us say for instance that you do not deposit your moneyat a bank, but instead, use all your money to purchase CONSUMPTION GOODS.
Let us say that everyone in the nation also uses all their income on
CONSUMPTION GOODS. In that case, a lot of goods would sell, so businesses
would try to raise output to meet the needs of the nation’s consumption bypurchasing INVESTMENT GOODS. Now here is a question; would the companies
be able to purchase INVESTMENT GOODS without a problem?”- 26 -

The students answered perfectly. “The companies need money to purchase
INVESTMENT GOODS, and the money needs to be borrowed from the bank,so…”“Would the banks be able to loan the money?” I urged.
“If there is no money in the banks, they won’t be able to loan money out tothe companies,” said one student.
“Beautiful answer! Then, what if there is just a small amount of money
deposited at the banks?” I continued.
The students, although novices to economics, answered: “The terms of theloan would be harsher.”“That is a beautiful answer as well! What you mean by ‘harsher terms offinancing’ is that the interest rate would be higher.” I supplemented so thestudents would get a sense of the interest rate as an adjustment of available
funds.
“This is getting a little bit confusing, so let us review the role ‘SAVINGS’ playin the general picture of economic circulation. As this picture shows, ‘SAVINGS’play the role of ‘INVESTMENT’ in the circulation. In other words, in a national
economy, described theoretically, SAVINGS are exactly equal to INVESTMENT.
4. Multiplier Effect of Public Projects
Let us review the relationships of each factor in the general picture. Of the
INCOME, “CONSUMPTION” is used to purchase “CONSUMPTION GOODS”, and“SAVINGS” are used through financial institutions by companies to purchase“INVESTMENT GOODS”. When all that circulates smoothly, the economy will run
well and individuals will continuously receive “INCOME” (CHART 4).
“I would like to point out to you, though, that this economic circulation
sometimes stumbles. When everything is left to the market entirely, somewhere
along the way the wheels start to slip.”“INVESTMENT GOODS only sell when there is demand for them, andCONSUMPTION GOODS also only sell when there is demand for them. The
companies continue to produce and sell these GOODS only because the GOODS
have buyers, but sometimes, for various reasons, the demand for these GOODS
wanes.”- 27 -

“When demand declines, naturally, sales of INVESTMENT GOODS andCONSUMPTION GOODS decline. When products do not sell, production slows
and employees lose their jobs. In situations like this, Keynes advises thatgovernments should undertake public works projects like building dams andhighways.”
CHART 4INVESTMENT GOODS(Investment Demand)
GOODS
CONSUMPTION GOODS(Consumption Demand)
PRODUCTIONCONSUMPTION(Propensity to Consume)
INCOMESAVINGS =INVESTMENT“But then, do you really think taking on some public works projects would
turn the economy for the better? Would the whole national economy really
recover and demand for investment goods and consumption goods increase
greatly? Sure, the people actually working on the construction project would
have increased income, but is that really enough to turn around a nation’s
economy?”Upon saying that, I explained how it works.
“Let’s say the banks have excess funds. Excess funds mean there is plenty ofmoney for the banks to invest, but only a few companies willing to borrow thatmoney. The government could then borrow this money to construct highways
or bridges. If the government takes on these public works projects, thecontractor Company X would profit and its employees would receive additional
income.”“The influence of public works like these seems very small. Only Company X
and its employees gain from the projects. But the influence on Company X and
its employees begin to spread to other companies and people in a domino effect.

- 28 -

“Company X, in order to finish the project on time, purchases investment
goods like machinery from other companies. As for the employees of Company
X, they would start purchasing consumption goods with the new income gainedthat they had previously held back from purchasing.”“From here, begins the new circulation. Purchases of investment goods by
Company X would influence other companies and their employees, and thateventually would trigger the next round of purchases of investment goods by
those other companies.
At the same time, purchases of consumption goods by the employees ofCompany X would influence consumer goods producers and their employees,
and that eventually would trigger the next round of purchases of consumption
goods.
“You see now that this process goes on to influence an almost endless numberof companies and their employees, and ultimately expands the investment
demand and consumption demand immensely. This is the rippling process that
Keynes theorized as ‘the multiplier effect’.”
5. The Propensity to Consume and the Economy
When the government begins public work projects, it influences many othereconomic players and boosts economic activity, and if done well, leads toeconomic growth. This is what is called the “economic stimulus with multipliereffects”. To visualize this ripple effect and to understand that the effect slowly
diminishes, I explained this governmental intervention to the students as being
like throwing a pebble in the center of a pond.
“If you throw a pebble in the middle of a pond, it splashes and makes circular
ripples. If the water is clean, the ripples expand to reach the edges of the pondover and over again. This is the Keynesian multiplier effect.”“What I would like for you to think about, though, is what if oil and sewage
drained into that pond and the water were tainted? What if, for example, thepond was full of detergent bubbles? The ripples would not spread evenly andthe effects would stop short. How would you make multiple ripples in suchsituations?”
They answered, “Throw a bigger stone.”“That is true. Throw a bigger stone, and there will be another ripple. There- 29 -

will be a bigger sounding splash, too, maybe. Then what if it got worse industrial sewage and polluted slimy water - and the pond is full of floating
garbage? Throwing a stone in that pond would cause little effect.”
An eager student in a front seat said just what I wanted to hear. “Then, throw
an even bigger stone.”“Yes. The situation here requires a gigantic stone. Actually, this is exactly what
is going on with government public work projects. At the beginning, a smallsized public works project is enough to influence many people, but the effects
diminish as the projects are repeated.”“Just like the thrown pebble, the public works projects need to get bigger tocreate the desired effects. Public works projects are usually financed byborrowing, which means bigger projects accumulate more governmental debt.
Many developed nations presently have colossal aggregate debt, which is due
to repeated public works projects amidst diminishing economic effects.”“Keynesian theory states that economic stimulus executed by the government
encourages a positive economic cycle. But in reality, as the gross national
income increases, the ripple effect decreases undeniably. Why is that?”
The students were not sure how to answer. So I continued, “If you had a lot
more income than you did, you wouldn’t spend the same percentage of yourtotal income, would you?” and gave an example.
“Let’s say your income last year was $50,000, and that you had a bowl of
cereal every morning. This year, though, you made $100,000 - twice that of lastyear. Now, would you eat two bowls of cereal every morning? The increase inincome increases spending, yes, but it never increases the percentage of
spending within the total income. Rather, the percentage of a person’s total
income spent decreases.”“It gets a little technical - but let us remember. The percentage of spending
within the income is called the ‘propensity to consume’. If it is 1.0, that means
any additional income is all spent. When the propensity to consume declines
and it is 0.6, then 60% of any additional income is spent and 40% is saved. In
any society, as it matures, the national income increases and with it, in general,the propensity to consume declines.”
What happens when the propensity to consume declines? What kind of
influence does it have on the economy? The first thing that comes to mind is
the decline in sales of consumption goods. How can we say that?

- 30 -

Imagine one nation whose propensity to consume is 0.9. And let’s suppose
the following. Now, in this nation, one person spends $100 million purchasing
consumption products. According to the multiplier effect theory, the next person,
who has received this $100 million, then spends $90 million (100 × 0.9). Again
the next person, who has received this $90 million, eventually spends $81
million (90 × 0.9). This process repeats over and over again. In the case of 0.9,
total spending stimulated in this nation will amount to $1 billion (CHART 5).
But if nation’s propensity to consume declines to 0.6, total spending
stimulated will go down to $250 million. Even if the first person spends twice($200 million) as much as the first case, the total will end up with just $500
million. In order words, if the propensity to consume declines, sales ofconsumption goods eventually go down.
CHART 5
Propensity(100)

Propensity

(100)

(200)

0.9

90

0.6

60

120

0.9

81

0.6

36

72

0.9

72.9

0.6

21.6

43.2

0.9

--

0.6

--

--

0.9

--

0.6

--

--

0.9

--

0.6

--

--

Total

1000

Total

250

500

That is not all. If the consumption goods do not sell, the companies do notneed to expand production capacity, and therefore they refrain from purchasing
investment goods. In short, when the propensity to consume declines, demand
diminishes for both consumption goods and investment goods. In this way, in
Keynesian theory, the ‘propensity to consume’ holds the key to the course of
economic future.
6. Problems in Japanese Society
Now that we understand how a national economy works, I would like toexplain why I said at the beginning of this chapter that “without improving thesituations of the socially vulnerable or disadvantaged, before long, the economy
would stagnate and suffer a serious slump”.
I have pointed out that the “propensity to consume” holds the key to a
country’s economic future, but just looking at the general propensity is notenough to find a policy that promotes continual economic growth. To say that- 31 -

economic maturity lowers the propensity to consume and therefore diminishes
effective demand is like saying “there is nothing that can be done”.
So let us take problems in present-day Japanese society as an example, andsearch for the “right policy to take”. As a common understanding, I would liketo identify the “two generation groups” in Japan with uniquely different
propensities to consume.
There is usually a high propensity to consume in the younger generation,
especially those with young children. Most of their income goes to spending.
This would be Generation I. On the other hand, the generation with grownchildren has a low propensity to consume per income. The reasons for this arethey no longer need to spend much on their children, and the bigger reason isthey now save more to “prepare” for old age. This is Generation II.
When people hit retirement age their income decreases. The percentage of
spending per income increases and their propensity to consume increases, butthat does not mean their total spending increases. On the contrary, they think
about life after retirement and spend less, aside from the medical spending. The
Retirement generation has this special characteristic, but we will keep things
simple and include the Retirement generation in Generation II.
I would like the readers to understand, that there are two distinctly different
generation groups in Japan, and that there is a financial transfer going on
between these two groups. That transfer goes like this;
7. How Financial Transfers Occurs
Today, many Japanese major companies strive to raise “return on equity”(ROE=company profit/shareholders’ invested money); to gain more profit andincrease dividend paid to stockholders. Whether by the efforts of the companies
themselves or by government economic policies, actually the major companies
are performing unquestionably well.
“Please think for a moment. One of the reasons for the rising performance of
these companies lies in the suppression of personnel costs. It is not due tolowered salaries of each of its employees, but due to lowered number of regular
employees and more low-cost, non-regular employees hired.”“There is surprising data here. In the first half of the 1980’s, the percentage
of non-regular employees in Japanese businesses was about 15%. Now, it is up
to 40%. There are diverse generations within the non-regular employees, but
the prominently growing generation is the younger generation. Many ‘people- 32 -

with a high propensity to consume’ are working as non-regular employees. The
young non-regular employees spend most of their income, but since their salaryitself is limited, they don’t have enough financial power to increase society’s
total consumption.”“On the other hand, companies are gaining profit from the suppressed
personnel costs. The lowered personnel costs are not the sole reason of profit,
but the contribution of the personnel cost cuts is great. The problem is thesecompanies intend to return the gains to stockholders.”“You have heard of stockholders, I presume. When you own company stocks,
you have authority to vote at a stockholders meeting - depending on the numberof shares - and you also get paid dividends. Nowadays, even the Japanese
government is pressuring companies to ‘increase dividends’ and ‘bring thereturn on equity above 8%’. I really don’t think it’s the government’s role, butthat is a subject for another day...”“At any rate, dividends are received by two kinds of investors: individual
investors and institutional investors. This will get a little difficult, but pleaselisten carefully. First, individual investors are people with enough financial assets
at hand to invest, and are relatively well-to-do.”“The institutional investors would be the life and property insurancecompanies, retirement funds, trust banks, and other financial institutions. The
people who sponsor these institutions are the people who buy these insurance
policies or invest money in these retirement funds or deposit money in thesebanks. In that sense, the institutional investors are an assembly of these
relatively well-to-do individuals. Hence, the increase in corporate dividends paidout goes more to the well-to-do Generation II, the ‘people with a low propensity
to consume’.”“Presently in Japan, the sum of all private financial assets is said to be about
15 trillion in US dollars. What is more, 60% of those assets are held by people
over 65 years old. Consequently, when companies increase their return on
equity, that money goes mainly to the older generation of investors, directly as
dividends or indirectly as returns from financial institutions or other results.”“Of course, if older people spend these financial returns accordingly, theeconomy would be positively influenced, but most of the older generation saves
the money to ‘prepare for retirement’. This means they have a low propensity
to consume and therefore cannot expand society’s consumption demand.”“The 15 trillion US dollars in financial assets will eventually be inherited by the- 33 -

next generation. So maybe the children who inherit the assets would use it for
consumption.”“What do you think? Do you think the next generation will spend the money?”
I directed my question at the students.
One diligent student who has been listening carefully answered, “Since theyounger generation has a high propensity to consume, they should spend themoney.”“Very good point. If the assets are inherited by a younger generation, theyshould have a higher propensity to consume, and one would think those assets
would be spent more. But here is the dilemma - our long life expectancy. In
Japan today, the life expectancy of both males and females is over 80 years.”“Oh I see!” the student exclaimed before I could explain.
“If the inheritance came from a person over eighty, their children would most
likely be around 60 and preparing for their own retirement. Even when they
inherit assets, they would probably not increase their spending much. They, too,would cut down on consumption in order to ‘prepare for retirement’.”
Let us review what we have discussed so far.
According to the effective demand theory, the society should transfer funds
not to the people with a low propensity to consume (e.g. older people with
abundant assets), but to people with a high propensity to consume, especiallythe socially vulnerable or disadvantaged like non-regular employees. Of course,when doing so, it needs to be done in a way that does not discourage themotivation of the general public to work hard.
The ultimate goal is to increase effective demand by transferring funds to thesocially vulnerable and disadvantaged.
In order to promote this transfer, the government needs to impose a
progressive tax sternly on income and inheritance. In addition to that, it needs
to increase public works projects to create more jobs, offer scholarships toprovide educational opportunities and develop comprehensive medical andsocial security. These measures are not spontaneously generated by the market.
The government must take charge and execute these plans properly.
This is “the redistribution of income and wealth by the government”(government compensation). Keynes is considered to be a new liberal because- 34 -

his theory inevitably leads to this conclusion.

- 35 -

Chapter 4

Rawls’ Ideal Society

The other major new liberal aligned with Keynes was the American
philosopher John Rawls (1921-2002). Like Keynes who emphasized “thenecessity of adjustments and interventions by a government”, Rawls “approvedof governmental compensation”. Which means Rawls, too, supported the below
formula of new liberalism.
RESULTS OF WORK =GOVERNMENT COMPENSATION×

EFFORT× ABILITY

Preconditions:
1) Government collects progressive taxes according to income or wealth.
2) Government provides employment & educational opportunities and welfare.
3) Government enacts laws to protect equal opportunities for all.

However, unlike Keynes, Rawls did not come to his theory by solving the
problems at hand. Rawls is distinctive in that his theory started from thequestion “what are the principles of justice?” and trying to answer it in the mostimpartial and logical manner possible.
1. Rawls’ Basic Questions
How can a society arrive at “universal principles of justice” that everyone canagree on? For everyone to agree on it, everyone must support it. If only the
majority support it, it would not be universal, since there will always be aminority that opposes it. It makes you wonder maybe there is no such thing asuniversal principles of justice.
Recognizing this, Rawls examined the reasons “why someone in society would
oppose to an idea in the first place”. He came to the conclusion that the reason
all people can’t come to a universal agreement is because everyone supports
principles and rules that would put themselves at an advantage over others.
Thinking this may be a little hard to grasp, I asked my students the following.
“Let’s say your teacher asked all of you what method of grading you would
like to have used in your classes. Your teacher is really willing to listen to yourthoughts and grade everyone with the best method. Everyone gets time withthe teacher privately to say what they think. What would you say to the teacher?”I gave a few answers.
“You would probably give a wide range of different answers: grade us on- 36 -

attendance, grade us on participation, give us all the same grade, or grade us
only on test scores. The opinions would never be all the same. Why wouldn’t
your opinions be the same?”“The answer is simple. You are all very honest students, but when asked what
grading method you would like, even the most honest among you would
unconsciously suggest a grading system that best suits yourself.”“Let’s look at each suggestion. The student that wants to be graded on
attendance is probably a very healthy student who has never missed a class.
The one suggesting participation has no problem speaking in front of the class.
People who want the same grade for everyone probably don’t like to study andare a bit insecure. And the ones who want to be graded on test scores isprobably confident about their knowledge and ability.”“Which means, when you are asked to decide on a rule with the knowledgeof your strengths and weaknesses compared to other students, you would most
likely suggest a rule that best values your strengths. This happens in a small
group like a classroom, so you can see, it is impossible for a whole society to
discuss the principles of justice and agree to a certain standard.”
2. Deriving the Principles of Justice in Reverse
People become selfish when they are asked to set a standard on how to
distribute and adjust income and wealth when they have knowledge of theirown strengths and weaknesses. Therefore, Rawls tried to derive a universal
principle of justice by taking this human nature in reverse. Meaning, he thought
if nobody had knowledge of their own strengths and weaknesses, they would
inevitably come to the same conclusion.
The situation where you do not know what is advantageous and what is not
in relation to others is called “putting oneself behind a veil of ignorance” or“putting on a veil of ignorance”. With this “veil of ignorance”, people will notknow the “difference” between themselves and others.
“Let me give you an example to illustrate. Let’s say the society is pyramidshaped. Under the veil of ignorance, nobody knows whether they are at the topof the pyramid, in the middle, or at the very bottom. That is not all.”“You do not know whether you are old or young, what your nationality is,what cultural or religious background you have, whether you are hard working
or lazy, if you have skills, intelligence, or wealth - in short, you know nothing.
All knowledge of what you are is hidden.”- 37 -

“Rawls thought, under such hypothetical circumstances, he as well as anyone
else would reach the same principles of justice. And if everyone, that is
hypothetical people, reached the same principles without any exception, thenthat would be considered the universal principles of justice.”“This is a very important point, so let me elaborate. If a person knew himself
to be at the top of the pyramid, this advantaged person would probably notsupport preferential treatment of the socially vulnerable. On the other hand, if
a person knew himself to be at the bottom of the pyramid, this disadvantaged
person would probably petition for extensive welfare and preferential treatmentof the vulnerable.”“But if you do not know where you stand, you would try to search for an ideal
principle that would not put you at a disadvantage no matter where you stand.
Therefore, if a principle could be derived this way, then, that would be theuniversally accepted principle.”“What do you think of the Rawls’ theory? It is pretty interesting, don’t you
think? He has thought hard and well, right? It is very impressive!” I said with
passion.
“Now, what sort of principles of justice did Rawls find this way? It gets more
and more interesting.”
3. Principle of Equal Liberties
The first principle that Rawls derived, by putting himself behind the veil of
ignorance, was what is called the “principle of equal liberties”. The principle
states “basic liberties” should be “equally guaranteed” to all people. The basic
liberties are the freedom of speech, freedom of association, freedom of thought,
freedom of body (to not be afflicted with psychological oppression, assault, or
life of threat), freedom of trade, right to personal property, and other “basic
liberties” that a person needs to lead a satisfying life.
“Would you like your basic liberties to be guaranteed?” Whether under theveil of ignorance or not, of course, everyone says, “Yes, I would like my basic
liberties guaranteed.”
So I went on. “These basic liberties, how about we give more to men andfewer to women?” I asked.
The girls would not have any of it, of course. “That is unacceptable,” they all- 38 -

replied at once.
“Then, what if in the other way, more liberties were given to women andfewer to men?” I asked.
A few students answered, “That’s okay.”“You have neglected the veil of ignorance with that answer. What would you
say if you had no idea about your gender?”“Oops. I forgot about the veil of ignorance.” They remembered the conditions
and amended; under the veil of ignorance, women and men must be given
equal basic liberties. The students seemed to have reached “the principle ofequal liberties”.
“You all have great insight! You have just derived the first principle of justicejust like Rawls did.” I praised the students.
The catch is, if basic liberties were guaranteed equally, since all people havedifferent skills and talents, and some try harder than others, the freedom to act
as one wish creates different results. Therefore, the principle of equal liberties
automatically results in a society with different outcomes among its members.
If different outcomes are not compensated for, new liberalism would be nodifferent from libertarianism.
Next, let us hypothesize the completely opposite theory and “not allow
differences in results”. Now, that would be the same as “socialism”. The shortfallof socialism lies in the common thinking that “you get the same thing whether
you work hard or slack off”. As you can imagine, in an equal result society,nobody would be motivated to work hard. Hence, a socialist society loses“prosperity”.
“Such situation must be avoided. Without prosperity in society, no benefit willreach the people at the very bottom of the pyramid. Therefore under the veil of
ignorance, everyone would at least agree that it is better for society to prosper
and therefore accept ‘a degree of difference in results’.”“I would like to point out that it is only a degree of difference, and notunlimited difference. So, if you think it is better for society when its members
apply their skills and talents fully and freely, then you would have to come up
with another principle in addition to the ‘principle of equal liberties’ – a principle
for a method of adjusting the outcomes (like income) among members.”- 39 -As I have mentioned before, libertarianism declared if people worked freely
with their skills and talents, “distributive justice” would be realized accordingly.
Yet, under the veil of ignorance, this conclusion will not be supported fully. If
one knew themselves to be at the top of the social pyramid, then that
advantaged person may support libertarianism, but as long as one is ignorantof where they stand, everyone becomes careful about distribution.
4. Difference Principle
When envisioning a universal principle of justice, a person would imagine
themselves being at the top, in the middle, and at the bottom of society
respectively. But when a person has no knowledge of where they stand, that
person imagines the “worst case scenario” and explores possible outcomes very
carefully so as to avoid personal hardship even in that worst case scenario. In
other words, that person would imagine being at the very bottom of society andtries to find a principle which that person could live with, even at that verybottom. Rawls conceived that any person behind the veil of ignorance, that is ahypothetical person, tends to think this way. Do we really all imagine the worst?
After explaining the shortfalls of utilitarianism, I had asked my students,“Would you agree to the school choosing a student randomly and locking thatstudent up?” None of them agreed.
If the students thought logically according to the principles of utilitarianism,
they should have agreed to the confinement. But they opposed it. Maybe they
opposed the idea purely from a human rights point of view, or maybe they
reacted more to the words “pick a student at random”.
What I mean is, maybe they opposed the confinement because they had
absolutely no knowledge what chances they would have of being randomly
picked and thereby experience the worst case scenario. They had reacted in an
instant, saying, “What!? How could the school do that?” “No way!” “Absurd!!”This may have been so because they feared that the horrible event could happen
to them.
We would not know for sure what made the students oppose unless we ask
them, but even if we did ask, there is no guarantee that they would answer
truthfully. One thing is for sure - with the veil of ignorance at work, that is,under no knowledge of the probability of being picked, it is quite possible thatthe students unconsciously imagined the worst and reacted negatively to theidea.
Supposing Rawls’ theory is correct, what distribution principle would be- 40 -

justified by the hypothetical person behind the veil of ignorance? According to
Rawls, it would be the “difference principle”.
“Let’s follow how this ‘difference principle’ evolved. First, when people apply
their skills and talents freely, they would get income and wealth accordingly. As
I have said before, if people were allowed to keep all of their income and wealth,that would be the same as libertarianism.”“The hypothetical person, without knowledge of their own skills and talents
nor their position in society, would probably oppose a wealthy person keeping
100% of their earnings without some conditions. Simultaneously, thehypothetical person would also oppose equal results for all since equal results
discriminate against the hard-working.”“So what we need to think about, now, is what the conditions should be forallowing people to keep the results of their work and efforts. The hypotheticalperson tries to avoid the worst case scenario - just like how you opposed
confinement by the school - and comes up with a condition.”“What do you think the condition is?” I asked the students to keep theirinterest.
“I don’t know.” “That’s hard.” “Is there such a condition?” They said. Seeing
them struggle with the question, I explained with an air of self-content.
“Here is the condition. If one’s efforts and skills improve the situations of thesocially disadvantaged at the bottom of the pyramid, then the earnings fromthat effort or skill may belong to the advantaged who acted towards that
improvement. In other words, the principle goes that if nothing is done toimprove the conditions of the people at the bottom, then, the advantaged may
not act freely to gain wealth.
5. “Distributive Justice” in a Hypothetical Village
I gave an example to illustrate.
“Let’s say you all live in a village. It is a hunting village. No farming is done.
Unlike any other village, there are no neighborly relationships. The villagers only
live close by geographically, and they all go about their own lives independently.
Now, there are a few good hunters in this village, but also a few who doesn’thunt well. You do not know if you are a good hunter or not. With that in mind,
I ask you a question.”- 41 -

“One skillful hunter had a successful day. On that same day, an unskilledhunter could not find any animals to kill. Hence, the unskilled hunter had noteaten anything for the past few days. In this case, should the good hunter keep
all of his meat?”To this inquiry, the students answered, “The meat should be shared with theunskilled hunter.”
I asked back, “Why do you think so? There is no relationship between thesetwo villagers.”
Interestingly, their answer was, “Because the good hunter can’t eat it all even
if he kept it all.”“Okay, then what if it were money and not meat? Meat rots, but money
doesn’t. Money could be traded for anything. Money could be kept. Even in thatcase, do you still think the earnings should be shared with the unskilled hunter- or the people who can’t earn their living?”
They were hesitant, so I laid out the conditions again. “You do not know at allwhether you are a good hunter or a bad one. In that situation, what do you
think should be done?”
With that, they answered, “Then, the earnings should be shared with theunskilled people.”“Should the skilled hunter give away all the earnings?” I asked on.
To this, the students concluded, “As long as some of the earnings are sharedwith the suffering people, the skilled hunter should be allowed to keep the restof the earnings.”“You are amazing! What you all have just said is exactly what Rawls concludedin the ‘difference principle’ of how to distribute wealth. A person may exercise
his/her skills to get meat (wealth), but in order to keep it, one condition must
be met; that he help out the suffering in the same village, to better theconditions of the socially vulnerable at the bottom of the social pyramid. You
have all thought this through and reached this conclusion - very well done!” I
commended them from my heart.
6. Principle of Fair Equality of Opportunity
There is one more principle that was reached under the veil of ignorance. It- 42 -

could be explained as a principle to allow ease of mobility within society. Rawls
calls it the “principle of equal opportunities”. Here is what the students and I
discussed.
“Do you think differences should be allowed in the authority andresponsibilities allotted to different positions and jobs held in society?”
One student answered, “It doesn’t quite seem right; that people with certain
jobs have great authority,” sharing her gut feeling.
Another student countered, “I think authority and responsibility are attachedto the job and the extent of them depends on the job, so differences are normal
and they can’t be helped.”
This comment prompted others.
“In reality, authority does depend on the position.”“Some certain position does hold more authority than others.”“No two jobs are the same in authority and responsibility.”“Those are all good points - right at the core of the matter. I have nothing toadd,” I said, yet added.
“Any person behind the veil of ignorance is allowed freedom of action as longas society prospers overall and the positive effects reach the bottom ends ofsociety, correct? As you have pointed out, the differences in authority andresponsibility would be allowed by this hypothetical person as a way to allow fordivision of labor and effective management, which then contributes to overallsocial prosperity.”“But someone felt ‘it doesn’t seem right’ that ‘it’s not right that a certain
person on a certain job gets great authority’,” and I looked at the student thatsaid so.
“Why did you feel that way? There must be a reason - could you explain?”
But it was a difficult question to answer.
“It is difficult to put in words. Can anybody else give a reason? Give it a try,”
I said to the class. But the class remained quiet. I thought better of it andexplained as follows.

- 43 -

“Maybe the reason she thought, ‘It’s not right,’ is NOT because of theconcentration of authority and responsibilities attached to certain jobs, but
actually the concentration of the certain kind of people attached to those jobs
with great power. Maybe you imagined the privileged class dominating highauthority jobs and positions and thought ‘it’s not right’?”
I looked at the student for confirmation. She hesitated for a moment, but
nodded, “Yes.”“Then the most important thing would be to provide equal opportunities for
all people to attain those high authority jobs and positions as well as to provide
equal opportunities to learn the skills and knowledge required for those jobs andpositions, wouldn’t it?”
So under the veil of ignorance, the hypothetical person would probably, firstof all, allow for the differences in the authority and responsibility of different
positions, but then secondly, provide equal opportunities for all to access thoseauthoritative positions. The “opportunities to access” means, for example,
opportunities to have job interviews or opportunities to get the required
education.
People basically believe that a society with fewer obstacles to social mobility
is preferable to a society with more obstacles. When people do not know where
they stand in society, nobody wants external factors like gender, nationality,class, race, and religion to automatically decide the status of their job. This is
the reason why Rawls came to the principle of “Fair Equality of Opportunity” as
one of the principles of justice.
7. Abilities and Talents vs Just Plain “Luck”
I posted the formula for new liberalism in the last chapter and at the beginningof this chapter. It is characterized by the inclusion of the “government
compensation” variable. Why is this variable included? It is because, basically,
new liberalism considers all human abilities and talents a simple “product ofluck”.
This way of thinking shows very distinctly in Rawls’ theory of justice. Because
he thinks the abilities and talents are products of luck, he insists on
redistribution of earnings gained by using those abilities and talents. Of course,
the market itself cannot promote the redistribution of earnings suggested in the
difference principle. The only possible agent to make this adjustment is thegovernment.

- 44 -

“Now, do you think famous athletes in tennis, golf, basketball, baseball, andothers are lucky to be blessed with abilities and talents? Do you think, since
they inherited those talents from their parents, that they were just simply lucky?”
I asked the students.
They answered, “Maybe the abilities and talents are genetic and coincidental,
but I think the professional athletes work harder than others.” “It can’t all bejust plain luck or coincidence.”
So, I told a story.
“Okay then. Let’s say there is a super skillful Hagoita champion (a Japanese
wooden paddle game - rarely played in modern times). That person’s skills are
the best in the world, but the world isn’t very interested in Hagoita. So, although
this person is very talented, he/she cannot earn a living from it.”“Compared to that, let’s look at tennis. The modern world is very interested
in tennis. There are many high profile tournaments held. Therefore, talented
tennis players can use their abilities to gain great wealth.”
The silly comparison seemed to appeal to the students. Taking their giggles
as a good sign, I went on.
“During the long span of history, whether a certain ability is noticed as a talentthat creates wealth is totally coincidental. What kind of talent emerges in who
is coincidental, but when and where that talent emerges is also coincidental.
What if Nishikori (a world ranked Japanese tennis player) had been born on a
cotton plantation in Georgia during the Civil War America? His ability to hit tennis
balls would not have, at that time and society, been valued much.”“Because the new liberals think this way, they consider coincidental abilities
and talents of people a common wealth. And since it is common wealth, they
believe it should be used to serve the socially vulnerable. Under the veil of
ignorance, everyone will reach this conclusion; this is the essence of what Rawls
wanted to say.”
8. Mismatch by New Liberalisms
At first, the reasoning seems proper, but of course, there is a shortfall inlabeling all abilities and talents coincidental. The high school students simply feltthat “the professional athletes work harder than others, so it can’t all be justplain luck or coincidence”.

- 45 -

This is an absolutely healthy and valid view. We do need to look at the
postnatal, acquired aspects of how talent is refined through daily effort. Nobody
would put in any effort, in a society where “whether the result of an effort isvalued or not is just coincidental”.
A political philosopher named Michael Sandel (1953-Present) pointed out thelimits of new liberalism in one of his books, taking a graduation award ceremony
as an example. I adopted his example and prepared two versions of the “speech
for a high school graduation award ceremony”, and read it to the class. The firstone was the standard version.
“Ms. Ichiko Suzuki, you have studied hard in accordance with the school
philosophy, cooperated well with your peers and succeeded as a great rolemodel to your classmates. You are hereby awarded summa cum laude for yourceaseless efforts and contribution.”
Next, I read a speech written in accordance with new liberalism.
“Ms. Ichiko Suzuki, you happened to match our school philosophy and guessed
test problems well which led to good grades. By chance, you became the rolemodel in your class with which you happened to work well together. You are
hereby awarded summa cum laude for your plain good luck.”
The students couldn’t stop laughing. But according to new liberalism, that is
how it would be. New liberalism accentuates coincidence. Because of this stance,
new liberalism holds two more faults within it.
9. Faults in New Liberalism“I would like to ask everyone. What other faults does new liberalism hold?”
Answers came back quickly to this question.
“If that way of thinking permeates people, the unfortunate may just blame
bad luck or other people for their unhappiness,” one student replied.
“It is possible that bad luck and other people have had to do with theirunhappiness, but it is questionable whether such excuses would lead tohappiness.” Another student made a brilliant point.
“If people blamed others all the time, I think the society will become unstable.”“Maybe radical people and ideologies will emerge”.

- 46 -

I honestly didn’t expect high school students to have such opinions. I wasvery much impressed by the younger generation.
Just as the students said, new liberalism could lead to radical outrage by thepeople dissatisfied with their lives. Many people may insist: “We are unhappy
because society is bad!”, “The government is the cause of our problems!”, “We
need to overthrow the unfair system to obtain happiness!”, or “It is our rightand responsibility to eradicate the faulty system!”If even the educated population kept blaming society and other people, thatsociety would most definitely fall apart. Unfortunately, this is one shortfall of
new liberalism.
There is one more, not-so-small fault in new liberalism. I asked the students
to guess what this fault might be, but they could not quite get at it. It could be
because they only had overseas experiences in developed countries, and neverin developing countries. So I shared a story of events in Ukraine.
“In February 2014, Ukraine’s Supreme Council removed their pro-Russian
President, Yanukovych. The reason for the removal was the disappearance of$37 billion from the Ukraine’s treasury and the involvement of the President andhigh-ranking officials in this matter.”“You have all studied English, so you should know that public officials arecalled ‘PUBLIC SERVANTS’ in English. This is because the government officials
are seen as those serving the best interests of the country’s citizens. And yet,when government officials gain various powers and their ethics fail, theytransform from ‘servants’ to ‘masters’. For example, when some are given theauthority to grant permits in a country where the rule of law is not working
properly, they could easily abuse the power and extort money from citizens.”“Ukraine had been in a civil war in the eastern regions. The Ukrainian
government forces and the pro-Russian forces had long been in conflict(Currently, both parties are in a truce). But, how did the pro-Russian forces
grow so rapidly in the first place? There was much speculation, but one source
suggested that corrupt border patrol officials took money to let Russian trucks
into the country right after the fall of the Yanukovych regime. If this is true, thecitizens of Ukraine had to pay a high price for the corruption of their government
officials. One bad apple spoils the bunch. Corruption at the top always spreads
to the very ends.”“I am telling you about Ukraine as an example of corruption that attaches to
big governments and powerful offices, politicians, and officials who pursue- 47 -

selfish gains using their power. Fortunately, present-day Japan scarcely sees
official corruption, but in much of the world, government corruption is thenumber one problem. This is the other huge fault of new liberalism.”
Needless to say, as long as governments, politicians, and officials with poweract “in the best interest of the people”, there will be few problems. Unfortunately,
though, too much power corrupts absolutely. In developing countries where
government transparency is still hardly realized, the authorities can do as theywish. New liberalism, which promotes big governments constantly faces thiscorruption problem.
We cannot, though, belittle the great effects of new liberalism in our society
today. Many countries, including Japan, adopt progressive taxation - collecting
higher taxes from the high-income population. This tax system is accepted inmany countries and is the key to the realization of distributive justice.
Furthermore, new liberalism calls for the government to provide
unemployment compensation and welfare as a safeguard for its sociallyvulnerable. In the past, religious organizations and charitable organizations ran
food banks and shelters, but now, governments also provide these services
regularly.
There were times when the situations of the unfortunate were looked down
on coldly as “self-inflicted”, and governments were far from helpful. As a result,society suffered economic meltdowns, human rights were violated, wars brokeout, terror spread, and societies experienced much suffering. New liberalism
includes valuable wisdom gained from the lessons learned.

- 48 -

Chapter 5

Problems in Present-Day Society

Libertarianism and new liberalism seem like oil and water. They would neverseem to agree with each other. Their biggest discrepancy is this: where
libertarians say, “All endeavors, exercised freely with effort and competence,are rewarded,” new liberals say, “Misfortunes and system flaws prevent efforts
from being fully rewarded.” One emphasizes “self-dependence” and “personal
responsibility”, while the other emphasizes “government adjustments”. But
these clearly opposing two philosophies, surprisingly, are based on very similar
theoretical premises.
1. Similarities Between the Two Social Philosophies“I have explained that these two philosophies are clearly very different, but
why don’t we look for their similarities now,” I proposed to the students.
Nothing came up at the beginning. I had focused on explaining theirdifferences, so this was understandable.
So I said, “Dogs and cats are different. But when you look at them from abigger perspective. They are both house pets. They both have four legs. They
are both mammals. When you stand back a little, you start to see many
similarities. This is what I am asking you to recognize in the two social
philosophies.”
So I pointed to one student at a time, and they answered one by one.
“They are both influential.”“They both have limits and shortcomings.”“Both are convincing in and of themselves, but they both are insufficient.”“They deal with income and wealth.”“They focus on how to distribute income and wealth”.
“Both are Western philosophies”.
“Both sound a little individualistic.”“Neither mentions a ‘Right Mental Attitude’.”- 49 -

“They are philosophies and yet, they don’t deal with ‘what is right’, which feels
odd.”“Neither looks at results in the long run.”“I feel they both revolve around the rights of people.”Those were some of the answers. I have summarized those answers into
three similarities. Those three could be called the common “theoretical premises”
of both libertarianism and new liberalism.
2. The Three Theoretical Premises“Thank you all for identifying those similarities. They are all very important
points. Considering all the points mentioned, we can probably say thatlibertarianism and new liberalism are both based on the following three‘theoretical premises’.”“Number one: both philosophies perceive independent individuals as the basic
unit that makes up a society. The feelings of ‘insufficiency’ and excessive‘individualism’ probably came from this premise. Also, the distribution of income
and wealth always comes into discussion as an important issue because thesociety is thought to be composed of independent individuals.”“Number two: as you’ve all pointed out, both philosophies avoid recognizing
a certain ‘way of thinking’ or ‘mental attitude’ as right. Proposing a ‘Right Mental
Attitude’ must directly threaten the notion of ‘freedom’ for them. Therefore,both of these philosophies never touch on ‘what is the desirable way of thinking’or ‘what is a right mental attitude’. This is what we’ve represented in theformulas.”“Number three: both philosophies expect the results of each person’s efforts
to manifest in a relatively short period of few years or so. If the results do not
culminate, then each person is advised to use their rights to take away obstacles.
I think you felt that ‘neither looks at results in the long run’ and ‘both revolvearound the rights of people’ because of this premise.”
After organizing the premises of libertarianism and new liberalism in this way,
I went on to identifying the characteristics of Inamori philosophy.
“Everybody, please keep in mind that libertarianism and new liberalism bothstand on these three theoretical premises. From now on, we will collectively callthese two philosophies ‘traditional social philosophies’. Now, on to Inamori- 50 -

philosophy - in a nutshell, it is a philosophy that does not stand on those threepremises of traditional social philosophies. Inamori philosophy stands on
different premises.”
3. Aristotle’s Philosophy and the Rise of Communitarianism
This characteristic of Inamori philosophy is not “only seen in his philosophy”.
The oldest philosophy that does not share the three theoretical premises would
have to be the philosophy of Aristotle.
“I have explained that social philosophies deal with freedom, justice, andprosperity and that philosophies dealing with these issues date back to the daysof ancient Greece. Do you remember? You must all have heard before; the mostdistinguished philosopher of that time was Aristotle (384-322BC).”“Contrary to the three theoretical premises, Aristotle had imagined ‘maninteracting with others’ (in association with others) and he encouraged people
to do the ‘right thing’ (right way of thinking). He stated that right thinking andright actions foster goodness in people, and thereby cultivates outstanding
character.2 Moreover, he stated that the cultivation of greatness is not a onetime or a short-term endeavor. Life has its twists and turns. Sometimes
misfortunes are encountered. But he believed that people who acquire
outstanding character could overcome these misfortunes and make the best of
their lives.3 This means he looked at happiness over a ‘long time span’.”I summed up Aristotle’s philosophy in this way and reviewed it for the
students.
“Do you see how Aristotle’s philosophy is very different from the traditionalsocial philosophies, even though they are all Western philosophies? Aristotle
imagined man in association with others and urged right actions throughout
one’s life. This is all very different from the theoretical premises of the traditionalsocial philosophies. In that sense, Aristotle’s philosophy sounds very promising,yet it is just so old that it lacks practicality and specifics to be applied to presentday problems. I suppose that can’t be helped. After all, the philosophy is morethan two thousand years old.”“Then, isn’t there a philosophy that inherits Aristotle’s philosophical legacy?”
I asked to keep the students on their toes. I didn’t expect them to know, though,2

Aristotle, Nicomachean Ethics, Volume 1, Translated by Saburo Takada, Iwanami Shoten,
1971, p. 66.
3
Aristotle, Nicomachean Ethics, Volume 1, p. 45.

- 51 -

so I answered my own question.
“There is one actually. It is a social philosophy called ‘communitarianism’. It isa philosophy that sprouted in the 1980’s in America, questioning theindividualistic traditions of the ‘separate and individual self’. Hence, we can keep
our hopes in this communitarianism.”
Saying so, I followed up swiftly with the limits of “communitarianism”.
“But to be honest, this philosophy does not clearly state how a society should
be or what each member of society should do. Many communitarians emphasize
the importance of ‘mental attitude’, but the definition of that attitude is vague
and varies from communitarian to communitarian. So, not much can be
expected of the present communitarianism.”
After this explanation, I offered, “Then how about Inamori philosophy? Ibelieve Mr. Inamori’s philosophy is equipped with all the elements of practicality,
specifics, and the consistency required.”
I am sure the students were ready to hear the specifics of Inamori philosophy,
but I took the time to start with the problems of present-day society. I thought
it would be the perfect way to show why a totally new and different social
philosophy was needed to solve problems, which the traditional social
philosophies have not mitigated yet or may have somehow even caused.
4. What Problems Do Present-day Societies Face?
“I have mentioned that traditional social philosophies influence our daily lives.
Also, that libertarianism and new liberalism both have common theoreticalpremises, and yet that they are incompatible social philosophies. Therefore, weare living with two conflicting philosophies. Of course, living with conflicting
philosophies would be fine if society were problem-free. But, are we really living
in a well-functioning society presently?” I urged the students to think.
“I’m sorry. The question may have been too general for you to answer. Okay
then, let’s think about problems in American society. Based on what you haveheard or seen on TV or read on the internet, do you know of any problems in
America?”“By the way, I am taking America for example because traditional social
philosophies are evident in American society. There are two very powerfulpolitical parties, Republican and Democratic, supported nearly evenly by the
public. They do not exactly fit the social philosophies, but you can say that the- 52 -

Republicans tend to take the libertarian approach and the Democrats tend to
take the new liberal approach. This is why I suggest that the traditional social
philosophies have not mitigated the problems in American society, or adversely
those philosophies may have caused them. ““Even if you have never been to America, you must have heard of the
problems of American society somewhere. Anybody have a thought?” I urged.
Here, one student replied, “I’ve heard there is a big gap in wealth.”“Thank you. Yes, we do hear that a lot. I have some data here to share. Thissurvey was conducted by an independent think tank called the Pew ResearchCenter. According to them, 65% of Americans feel the gap between the rich andpoor has gotten larger, and of that 65%, 57% feel that ‘that is a bad thing forsociety’.”“The widening gap in wealth is a problem, but the most serious problem isthe disagreement between the Republicans and the Democrats on the cause ofthis widening gap. The libertarians blame the lack of effort as the cause ofpoverty, but the new liberals blame factors out of one’s control. This is why thetwo parties cannot come to an agreement on ways to solve the problem of thiswidening gap in wealth.
“America’s gap in wealth may still be tolerated for now, but if time passes
without an effective solution, the problem may progress into a serious,
impermissible, society-dividing conflict.”
Summing up the wealth gap problem in this way, I continued, “Any otherproblems in American society you’ve heard of?”“I’ve heard on the news that public safety is declining in America,” one student
added.
“Thank you. Public safety is another big social issue. We hear that widening
gap in wealth is causing the wealthy to flee from life in high crime areas. When
the wealthy leaves an area like this, that area will suffer from lower tax revenues
and therefore reduced police, fire and other public services.”“It is also pointed out that the failing public safety is rooted in failingcommunity connections. In fact, urban as well as rural America is seeing lessinterest in their own communities - not even knowing who their neighbors are,not even noticing neighbors with hostilities against the nation. Now, thegovernment has surveillance cameras on every street corner and they even

- 53 -

monitor phone calls. Although America is said to be ‘the land of the free’, since
9-11 it may have turned into the land of the surveilled.”“Okay, we have two social problems now. Any others?”
Then, a student at the back of the classroom said, “I saw a TV special on
current abuse of the legal system in America.”“Yes, that is another serious problem in American society. Since people do notknow the others around them, they live with constant suspicions of the others.
Even when there is a minor dispute, they often rely on the legal system
immediately and sue. They have almost no second thoughts about fighting incourt to protect their own rights.”“Before, even in America, those trivial disputes were peacefully settled within
the community. But now, many communities have lost such capabilities. Hence,the people often go to court. Specialists like lawyers are also fueling the
exploitation. They search for as many clients as possible in order to win casesand earn large fees.”
I touched on two more issues to do with the legal system.
“Since it came up, let me go over two more things to do with legal rights. The
first thing is, when the rights of one person and the rights of another conflict,an agreement between the two is hard to reach. One typical example would be
the conflict between freedom of speech and a ban on hate speech (speech that
attacks a person or group on the bases of attributes such as gender, religion,
race, etc.). If a religion were criticized freely without consideration, that
religion’s believers will be deeply offended. Especially when the only spiritualsupport of the socially vulnerable were to be looked down on and slandered by
the majority in the name of free speech, the vulnerable would view it as hatespeech and feel violated.”“The other thing is, not all trials end with the victory of the right party. I would
like to say ‘justice ultimately prevails’, but in the real world, that isn’t always
true. Often, the side that can afford better lawyers wins the lawsuits. The
difference in wealth can greatly influence the outcome of a trial. Let’s say thewealthy with able lawyers are able to win lawsuits against the socially vulnerable.
Moreover, in those cases, the court decisions are often very unreasonableagainst the vulnerable. Do you think the vulnerable would accept those decisions
without any problem?” I asked.
A girl in the back of the class answered, “Well, wouldn’t that depend on the- 54 -

specifics of the judgement?”“That is true, yes. But I would like to stress that the socially vulnerable feelanger and hate just the same as any other people. What would happen when
they feel there is no justice in society - that the judicial system is rigged to workfor the wealthy?”“When they have no money or authority to right this wrong, they might feelcompelled to overthrow the present system by force. Even though they knowthat using force is wrong, there is always a possibility they might see no otheroption. If that happens, it would be very unfortunate both for the society andthe person having to rely on force. Over-suing, or abuse of the legal system,
could eventually lead to an unsafe society.” I said in conclusion.
5. How About the Japanese Society?
The three social problems raised here are observed not only in America, but
in all societies influenced by the traditional social philosophies, without
exceptions. In Europe, the wealth gap is becoming so severe that national
bankruptcy is a real possibility. The conflict between Western societies andIslamic societies over ‘freedom of speech’ is a fight between two competingrights. Moreover, while enjoying materialistic prosperity, developed nations
suffer isolation and rising mental illness. Because of the increase in terrorism
worldwide, peacekeeping by military force is at its limits.
Japan is no exception in being influenced by traditional social philosophies.
Until relatively recently, most Japanese considered themselves middle-class. But
since the bursting of the bubble economy (asset-inflated economy in 1980s
Japan), everything has changed. A decline in public safety can’t be denied. It
has not yet become a legal system abusing society, but there is a high possibility
that society is going in that direction.
Interestingly, in spite of all this, no alternate philosophy was seriously sought
after that could replace the traditional social philosophies or overcome theirlimitations in Japan. Maybe it is because the problems are not so serious yet,but probably it is more because the sense of community is still valued and deeply
rooted in Japanese culture.
In academia, much research was done on the value of community since prewar Japan. I have mentioned that in America, communitarianism spurred in the
1980s, but in Japan, it was being discussed decades earlier. Yet, after WorldWar II, research on community values was labeled as old thinking whichemphasizes duty and obligation and was therefore generally shunned.

- 55 -

Libertarianism and new liberalism were brought to the center stage of social
philosophy.
But this is only in the academic scene. Communitarian thinking remained in
the subconscious of the Japanese people even after its disappearance frompublic discussions. In that sense, Inamori philosophy is a typical social
philosophy born out of Japanese culture.

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Chapter 6“Freedom” in Inamori Philosophy

Inamori Philosophy does not follow the three theoretical premises of the
traditional social philosophies. From here on in, we will look at how Inamori
Philosophy differs from the traditional social philosophies, and see the result of
those differences.
First, we will discuss the traditional theoretical premise of “separate andindependent individuals”. In traditional social philosophies, theories focusing on
relationships between people were perceived dangerous as it could jeopardize
freedom. No matter whose theory it was, it was viewed to be a regression to
Middle Age thinking. But Inamori Philosophy is not an anti-freedom theory.
Rather, it advocates “higher freedom based on reason” that the traditional social
philosophies overlooked. What is the meaning of “freedom” in Inamori
philosophy that values “relationships between people”? Let us follow thereasoning.
1. Recognizing “People in Association”
In traditional social philosophies, the most basic unit of a society is understood
to be an “abstract individual” or a “separate and independent individual” that isleft after all of the human relations are shed off. This is the tendency of theWestern philosophical traditions. The “society” that the Western philosophies
dealt with was too complex to be explained as a whole. So for analysis, a society
was divided into smaller parts until it could not be divided any further. Hence,
the “individual” was deemed the smallest basic unit of a society.
In contrast, Inamori Philosophy does not consider a person to be anunattached individual. That is because when a person is reduced to an
unaffected, unattached individual, the responsibilities and roles naturally
attached to a person would also be lost. If society must be organized into
smaller parts, the smallest unit has to be a “person in association with others”
or “the associations of a person”, and not “individuals”. In English, the word usedmust be “a person” in association, because the word “person” originally included
the meaning of a collection of “faces” and various “roles”.
Theoretically, the unattached, independent individuals unaffected by others
may be imagined. Yet in reality, all people work, talk, and live in association withothers - as a “person”. To understand the reality of humanity, Inamori
Philosophy focuses on what expectations and feelings people have, and how
others respond to those expectations and feelings.
For example, libertarianism focuses on the producer aspect or labor provider- 57 -

aspect of working people, disregarding the “multiple human aspects” of thosepeople. In contrast, Inamori Philosophy treats both workers and managers as
subjects with relationships that naturally come with expected roles, and as
subjects who grow together through cooperation. This is Inamori’s strong belief
and the basis of how he has treated everyone. This conviction is represented
perfectly in the events following the formation of Kyoto Ceramic (the current
Kyocera): “demand of payment by the new recruits”, “conversations with the
new recruits”, and “reflections on the event”.
2. Realizing the Responsibilities and Expectations through Association“Please allow me to talk about Mr. Inamori’s background for a little bit. He
founded Kyoto Ceramic at the young age of 27, dreaming of succeeding as anengineer. Starting the company was his choice and his free will. His associates
and seniors backed him up whole-heartedly, ‘wishing him the best to realize his
potential as an engineer. But in the third year after establishing Kyocera (Aprilof 1961), he realizes that his dream as an engineer was not enough to keep thecompany going.”“The realization came when young employees just out of high school, like you,demanded promises regarding future compensation’ from Mr. Inamori. Unlike
today, labor movements were very active at that time and such disputes among
workers and management were fairly common. As a result, this became anissue at the newly established Kyocera also.”“The demands were made by eleven freshly graduated employees. But there
was no way the newly founded company could guarantee future compensation.
So Mr. Inamori invited the employees to his home and for three days and threenights, he talked with them honestly about the company circumstances and his
dreams, trying to get through to them. It is said that his sincerity and passion
slowly persuaded the employees. But one young man did not budge on his
demands.”4“Let’s say you are the captain of a sports team. Let’s say the team waspracticing hard for the state championship, but a few of the team members
resisted leadership. You try to convince the unsatisfied members, but one last
member would not see things your way. What would you do?” I asked, andurged the students to think in Inamori’s shoes.
Managing a company and managing a sports team may not be exactly the4

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography) Nihon
Keizai Shimbun, Inc., 2004, pp. 79-81. Kazuo Inamori, Atarashii Nihon Atarashii Keiei (For
People and For Profit) PHP, 1998, pp. 132-135.

- 58 -

same, but they both deal with influencing people’s attitudes. The students
answered, “Try to convince that person,” “Keep trying,” and “If that doesn’t
work, take that person off the team.”“Just like you said, Mr. Inamori kept trying to convince that person. But nomatter how hard he tried, it was in vain. So what do you think he did next? You
have said, ‘Take that person off the team,’ but do you think he fired that final
resisting employee? He did not. Mr. Inamori kept on trying, hoping the employee
would understand and believe. He just kept explaining.”“And when all was said and done, and nothing convinced the employee, hesaid one last thing. What do you think he said?”
The students must have thought, “Finally!” They said, “There is no way for
you to work at my company,” “If you don’t understand after all my explanations,find another job,” or “If you are not satisfied, you are welcome to quit!”
To all this, I said, “Neither of those.”
The students were eagerly hanging on to the story. When they were primed
to hear the answer, I introduced Inamori’s words.
“His words were, ‘If I ever wrong you, you can stab me to death.’ This may
sound a bit violent to you, but what he said was, ‘I will not wrong you,’ ‘Believe
in me,’ ‘I cannot prove to you my determination physically, but I swear on mylife, I will do as I promised.’”5“There is a manga called One Piece. I don’t know the exact story, but I knowthat the main character Luffy is trying to become the Pirate King. I’m sure you
are more familiar with the story than me, so tell me, how is it that Luffy is so
loved and admired by his mates? How does he befriend so many people?” I
asked.
This question relaxed the class. They probably didn’t expect me to talk aboutmanga. They started to speak up.
“That’s because he doesn’t abandon his mates, ever.”“He would give up his own life for his friends.”“He values trust more than anything.”

5

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography) p. 81.

- 59 -

“Thank you. I see. One more thing I want to ask. What do you think is themost-read manga in Japan now?” After all my talk, anyone could guess that theanswer is One Piece. I went on with that shared understanding.
“A Manga with the theme of ‘Never abandon your mates’ is grabbing thehearts of many people, especially younger people. Young Mr. Inamori is said tohave been just like Luffy, to put it in modern terms, at the time he founded
Kyocera. Enough to have said, ‘If I ever wrong you, you can stab me to death.’
The one last resisting employee is said to have shed tears hearing these words,
and he finally shook Mr. Inamori’s hand in reconciliation.
“Now then, if Mr. Inamori went back to his old routine, thinking that the
problem had been solved and was done, he would have remained just an
ordinary manager. Anyone can just convince others and then go on as before.
Mr. Inamori is special because he took a drastic action to make sure that hewould ‘never abandon’ his employees. That is, he put down in words his newly
found conviction; that his company was not only a tool to actualize his personal
dreams, but instead, the company existed to bring happiness to its employees.”
He talks about this experience.
“After agonizing over this for few weeks, I got over myself and thought tomyself that if I managed my company only to realize my dream as an engineer,even if I succeeded, it would be due to my employees’ sacrifices. But there must
be a bigger purpose to a company than this. The most fundamental objectiveof company management should be to protect its employees and their families
into the future, and to see to the contentment of them all.”6“Ever since this experience, Mr. Inamori has always declared the corporate
policy to ‘Pursue the material and personal growth of all employees’ at Kyocera
and JAL and all the other companies he supervised. He strongly recognized that
employees expect their company’s management to protect their well-being andthat management has a responsibility to answer to these expectations.
Consequently, he declared this as the pillar philosophy of his companies.”
In other words, he put himself in relation to his employees, and in thatassociation, reconsidered what his responsibilities and roles were; representing
it in the words, “Pursue the material and personal growth of all employees”.
“I want to do”, “I wish to become”, and “I want to try”; if Inamori just kept
his focus on himself in this way, he may have only pursued his dreams as an
6

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography) pp. 8182.

- 60 -

engineer. But his heart-to-heart talk with his employees gave him the golden
opportunity to reevaluate his own being in association with other people.
3. Associations in Every-Day Life
“Mr. Inamori became fully aware of what he needed to do as a result of his
conversations with his new employees. In that sense, we can probably say thatwhat is expected of us and what we need to do becomes evident in our
relationships with others. Now, have you ever had that same sense of realization
in your relationships?”
The students were unsure.
“I think he was conscious of his relationships more because he is a company
manager.”“I think young people think and act according to their own personal interests
rather than in the interests of their relationships.”“I don’t think many people really think of what their responsibilities and roles
are in relation to others.”
I was a little disappointed, but I regrouped and told them the following.
“I think you can see that people act in accordance with their relationships,
even without an intense experience like that of Mr. Inamori. Because it issomething everyone encounters every day. Let’s imagine you invited your two
best friends over to your home.”“That day, your mother happened to be home, so your friends say, ’Hi!’ toyour mother in the kitchen as soon as they arrive. Then, you take your friends
to your room, and in about 30 minutes, your thoughtful mother brings you all
snacks and tea. Question number one: Do you appreciate your mother bringing
you snacks?”
Everyone answered, “Yes, I would appreciate that.”“Your mother, after bringing you snacks, does not leave your room. She istalking by the door at first, but eventually, sits down on a chair in your roomand joins in on the conversation. Question two: Do you wish your mother would
leave your room soon?”
The majority of the students answered, “Yes, I would want her to leave- 61 -

quickly.”
Confirming their response, I went on. “On that day, your father happened tobe home, too. Since your mother didn’t come back to the living room, yourfather gets lonely and comes looking for her and finds her in your room. ‘What
are you doing?’ your father says and pulls up a chair to join in as well. Last
question: Can you bear your father staying in your room?”“Unbearable!” They all answered.
Many fathers dote on their daughters, but perhaps from the daughters’ pointof view, fathers are a nuisance. But are fathers really a “nuisance” to theirchildren? So I asked one more thing.
“Don’t you like your mothers and fathers?”
To my relief, the replies were, “No, no. It’s just that, I just don’t want themintruding on my conversations with my friends,” “I don’t hate them, it’s just
uncomfortable having them sitting there,” and “I don’t hate them, it’s justannoying.”“If you don’t hate them, why do you not want them sitting there with you andyour friends? Can you think of a reason?” I encouraged them to think.
I waited for the students to answer, but none did, so I offered, “The reason is
because you all act in accordance with your relationships.”
Of course, this was not enough explanation, so I supplemented.
“You all act under different masks daily. When I say masks, they are nothingbad - I just mean that you have different masks and roles in various
relationships with various people. You have a certain understanding among yourfriends, and you behave according to your understanding of how you should act.
Similarly, you have an understanding with your parents as well, and you
unconsciously act according to that understanding.”“The masks are not limited to just two. In my case, I have masks or roles asa husband to my wife, as a father to my children, as a teacher to my students,
as a neighbor to my neighbors, etc. On top of that, we barely think about playing
these different roles because we do this unconsciously.”“But, we humans are not very good at acting in more than one role
simultaneously. When we try to act under multiple masks at the same time, we- 62 -

feel great stress. You have mentioned before that young people like you do notreally think of responsibilities and roles you have to play, but is that really true?”“Instead, I think you measure your relationships very rigorously,
distinguishing your roles and responsibilities clearly, and then act accordingly,
more so than any other age group. You didn’t want your parents to join in on
your conversations with your friends because you would have to play two
distinctly different roles at the same time.”“You wear the mask of a daughter to your parents, but have a different mask
among your friends, especially here in Japan. At home, you probably call yourparents Mama and Papa, among other names. This is because you don’t change
the way you address your parents from early childhood. Your parents also
expect you to address them in that way. There is an unspoken understanding
between you and your parents. On the other hand, you call your parents Motherand Father at school to your friends. You might not refer to them like high schoolboys do. But boys call them ofukuro (woman in charge of home financing) andoyaji (old man) at school. You, and boys also, hesitate to call them Mama andPapa to your friends.”
Explaining in this way, I concluded by saying, “You feel uncomfortable andstressed to have both your parents and your friends in the same space because
you get confused as to which role you should play. In other words, your distressover your role is due to your existence as a person in associations with others.”
4. Discovery Beyond the Awareness of Association
With that example, the students understood the meaning of “person inassociation” and also recognized that they actually live every day in such
associations themselves. But what becomes apparent with the recognition of“person in association” or “the associations of people” as being the basic unit ofsociety (instead of the “separate individuals”)? Could we see what the traditionalsocial philosophies failed to appreciate?
When things are based on “separate individuals”, value would be placed onwhat each individual gets. Therefore, in the traditional social philosophies,
income and wealth that could be reciprocated to individuals were considered to
be important. But when things are based on the “associations of people”, added
to the things that are given back to individuals, things reciprocated inrelationships also become important.
Things reciprocated in relationships could include wealth like “jointly owned
property”, but the main wealth would not be possessions. Instead, the- 63 -

reciprocated wealth would be the new connections formed between people. I
would like to call it “relationship wealth”. Some examples would be trust, praise,
respect, and moreover, the safety of the community and society based on these
relationships, fulfilling lives and bonding between people.
Some may sneer and say, “Those things are only emotional. They have nomonetary value and they are unreliable.” But in the wake of the Great East
Japan Earthquake, many of us, including the victims, realized the importance ofconnections and bonds between people. It is true that “Connections and bonds
cannot feed people”, but it is also true that these ties gave courage and hope tothe many. These may not be convertible to monetary value, but they certainly
gave courage and power for the people to carry on.
“As you remember, a 9.0 magnitude earthquake hit eastern Japan in March
2011. All public transportations stopped in the city of Sendai, and many people
were stranded far away from their homes. Sendai suffered great tremors andmost shops were heavily damaged. Virtually no shops were in any condition to
open for business because of the damage. In such a situation, people gathered
at bicycle shops for a way to get back home to confirm their family’s safety.
People thought they could get home on bicycles instead of the non-operational
public transportation.”“This is a story about one bicycle shop. To help the stranded people who cameto the shop, the owner decided to open for business. But the people didn’t haveenough cash on them to buy bicycles, and with the power down, credit cards
were of no use. So the shop owner, without hesitation, let people take thebicycles at the regular price and agreed to be paid later. He let total strangers
take the bicycles with as little as a note with their home addresses. In the end,
every single one of these people, without exception, came back to pay for thebicycles later.”“This may be an extreme example, but from the standpoint of the traditionalsocial philosophies, this shop owner did not act rationally. Libertarians would
have seen the imbalance of supply and demand and would have raised the priceof the bicycles. If the price rose, other shops would also sell bicycles at higher
prices to gain wealth, and therefore more bicycles would be supplied to thequake-hit area. And when enough bicycles were supplied, the shortage ofbicycles would be solved and the price would start to fall.”“To put it simply, when owners act to gain wealth, eventually it would comearound to help the devastated area. This is the reasoning of price increases
according to the Libertarians. What do you think about this reasoning?”- 64 -

“The other philosophy, new liberalism, would count on the government to be
in charge of saving the vulnerable people in this kind of difficult situation. But inthe face of a disaster, no one has time to wait for the government to start acting.
Also, there is no way of knowing who is the most vulnerable and most in needamidst the confusion. Maybe the shop owner was in a direr situation than thepeople who came to buy the bicycles. If that were true, then maybe the shop
owner should have sold the bicycles at a slightly higher price.”“Either way, what do you think would have happened if the shop owner ripped
off the people with outrageous prices in the midst of the disaster? The reluctant
buyers would have been unsatisfied, and some may not have come back to pay.
All they had to do was to give a false home address and not come back.”“But, in reality, every one of them came back to pay. The buyers respondedwith sincerity to the shop owner’s good will. Why do you think they acted thisway?”
To my question, the students in each one’s own words answered, “Probably
because both the shop owner and the buyers thought, ‘Disaster is not something
to be making money on. This is the time to help one another. Trust must be
returned with trust. We have to value our ties with others.”“Those are probably right. I also agree with you. The feelings, the attitude,
and the mutual understanding - these are what we call the ‘relationship wealth’shared between people. It could also be called the ‘intangible assets’ created by
the community.”
5. Appreciating Connections
To be precise, “relationship wealth fostered between people” include negative
wealth as well as positive wealth. Examples of negative wealth would be
skepticism, mistrust, insults, disdain, and the failing safety of the communityand society under those negativities, emptiness of life, and widespreadloneliness. When one side doubts the other and tries to deceive, the other would
do the same. As a result, negative relationship wealth resulting from mistrust isborn into society.
Of course, this explanation is just a categorization of the fact that there areboth “positive relationship wealth and negative relationship wealth”. The
categorization of concepts is a sociological specialty, and not within the scope ofsocial philosophy. What social philosophy must do is beyond the scope of
categorization. Meaning that social philosophy must answer questions regarding
practical aspects like, “What can be done to create positive relationship wealth?”- 65 -

and, “How should one act out one’s various roles and responsibilities to foster
positive relationships?”
But, there could be an argumentative person who says, “Why must it be apositive relationship?” To avoid such discussion, I asked the students thefollowing.
“In society, would people desire trust, praise, and respect or, alternatively,
skepticism, mistrust, insults, and disdain?” The answer is obvious, but I
confirmed. ”Which do you think?”
The answer, of course, was, “Trust, praise, and respect.”“Yes. Normally, people would not desire to be insulted or mistrusted by otherpeople. No one would want deteriorating public safety or an unstable society.
There may be times when relationships deteriorate, but I don’t think anyone
would think that to be desirable. It is obvious when you see things under the‘veil of ignorance’, too.”“Mr. Inamori placed this preference of trust, praise, and respect as anirrefutable fact and considered what should be done to foster these kinds ofrelationships. And as a result, he came to the proposition of ‘practicing a Right
Mental Attitude’.”6. Freedom from the Chains of Desires
Explanations of the “Mental Attitude” itself and its assessment will be left tothe next chapter. Here, we will go over Inamori’s interpretation of how the Right
Mental Attitude to foster relationships relates to “free will”. That is, I would liketo cover the most important social philosophy topic of “freedom” as he sees it.
“As I have mentioned before, during the Middle Ages, relationships - especiallythose between the ruler and the ruled - restricted the freedom of people. In
order to break free from this age, the traditional social philosophies imagined
independent and free individuals with no ties to other people. Therefore, any
philosophy proposing to ‘practice a Right Mental Attitude’ was immediately
mistrusted as a throwback to the Middle Ages or as a denial of a person’s free
will.”“Understandably, when someone pushes you to have a certain ‘Mental
Attitude’, it does feel somewhat restrictive. What do you think?” I asked.
One student shared her thought. “When your actions are decided for you in a

- 66 -

relationship, and all you do is follow, I think there is no freedom there.”“You just mentioned a very good point. You said ‘decided for you and all you
do is follow’. Could that ‘decided for you’ be interpreted as ‘decided outside ofyour own will or reason’?” I confirmed with the student.
“Yes, it could be interpreted that way,” she agreed.
“That means, then, that Inamori Philosophy can be interpreted as a way tofree people by proposing the practice of the ‘Right Mental Attitude’.” To explain
this, I demonstrated with a piece of chalk in my hand.
“This chalk in my hand, if I let go of it now, what would happen to it? It would
fall to the floor. Of course, chalk has no will, so it would just follow the laws ofphysics and fall. Using the phrase that we mentioned, “follow what is decided”,
the chalk would just follow what is decided by the laws of physics and fall.”“If I show some food to a starving cat, the cat would dash to the food and eat
it. The cat would follow the physiological instinctive desire to eat, and act. The
cat could be said to have been bound by the laws of physiology outside of its
will.”“Humans, of course, are bound by the laws of physics and physiology as well.
The more difficult things with us humans are our in-borne instincts and desires.
As humans, we naturally follow these - but to simply follow what is decided bythese instincts and desires would mean, in turn, that we have no freedom - justlike the chalk or the starving cat.”“Have you heard of a German philosopher named Emmanuel Kant (17241804)? Maybe his name rings a bell. If the name is new to you, please take thisopportunity to remember. People may say freedom is doing what one desires,
but Kant stated: true freedom is NOT doing what desire drives you to do.”7“He stated, true freedom is unchaining oneself from the laws of physics andinstinctive desires with the power of reason, and deciding what should be done
autonomously. This Kantian concept of freedom is precisely the same definitionof ‘freedom’ given by Mr. Inamori.”
7. Practicing Free Will
“Kazuo Inamori realized the meaning of ‘freedom’ through his experiences,
7

Emmanuel Kant, Doutoku Keijijyougaku Genron (Groundwork for the Metaphysics of Morals),
Translated by Hideo Shinoda, Iwanami Shoten, 1960, pp. 28-29, pp. 43-45.

- 67 -

and practiced it in the way he lived.” Saying so, I introduced some of his words
to the students.
“Humans are born with both instincts and the ability to reason. To eat, todrink, to fight, to lust, and to envy are all preservation instincts to protect thelife and prosperity of oneself and one’s family.” “Human beings often basetheir decisions on these instincts.” “But that would just be the same as being
animals. If one could assess the situations more objectively, better decisions
could be made.”8“Mr. Inamori explained in this way and went on. Let me share with you theimportant excerpts,” I said and flipped through my copy of his book.
“Suppressing instinct is not an easy task. Humans cannot live without
instinct and I am not saying to let go of all instincts.”9“The important thing is to recognize when your own selfish desires emerge,
and to try to consciously suppress them.” “The best way to rein in one’s
instincts is, when you start to feel self-centered desires, to keep tellingyourself, ‘Don’t be selfish!’ This habit of keeping your instincts in check willbring your ability to reason up front, and lead you toward correct decisions.”10“This is getting a little complicated. These words used, like instincts anddesires are not limited to physical things. They encompass greater desires. For
example, any new relationship forged or kept for self-benefit would beconsidered to be based on desires.”“As we learned, traditional social philosophies despised past ruler-subordinate
relationships as ‘restricting freedom’. These relationships were despised because
the ruling class used them to maintain the ruler-subordinate relationships fortheir own benefit. But what if the people who overthrew this ruler-subordinate
relationship forged a new relationship to fulfill, yet again, their own selfish
desires?” I asked the students.
Nothing came up, so I brought up the concept of a “contractual relationship”
to their attention. “What I mean by ‘a new relationship’ is a contractual
relationship of give and take.”
A contractual relationship’s characteristic to modern society is a free, give andtake relationship between equal parties, each pursuing their own benefits. Both
8

Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success) PHP, 2007, p. 48.
Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success), p. 49.
10
Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success), p. 49.
9- 68 -

parties are guaranteed the freedom to take part in or to withdraw from therelationship. You all receive educational services from this high school, but if
you are unsatisfied with the quality of the service, you are free to quit and go
to a different high school. Similarly, your high school is free to, theoretically,stop providing you with educational services and expel you if you did somethingoutrageously wrong. This would be the contractual relationship between you
and your high school.”“Contrary to this, the past ruler-subordinate relationships did not allow thesubordinates freedom to withdraw from the relationship. In that sense, the pastruler-subordinate relationships are completely different from the modern
contractual relationships. But I would like for you to think about how similar the‘motives’ to form these relationships are.”“The rulers in ruler-subordinate relationships forged these relationships withmotives to satisfy their own desires. In the same way, parties in thesecontractual relationships are also motivated to satisfy their own desires. On topof that, in contractual relationships, the motives to enter into a contract as wellas to withdraw from the contract are both always based on self-benefit.”“Let me ask again. What do you think about forming new relationships or
breaking existing relationships based on your own benefit or instincts anddesires?” I asked.
As expected, the answers were, “I think that’s fine,” “It is so in reality,” “I
don’t think striving for self-benefit is all that bad.”“Yes. It’s true. We are in a contractual society, and all parties go into a contract
with their own benefit in mind, so it should be fine, right? I had shared some of
Mr. Inamori’s writing, and because he thinks similarly, he wrote ‘I am not saying
to let go of all instincts,’ probably.” I pointed out the similarity of Inamori
Philosophy and the students’ thoughts.
“But, I would like to ask. Do you really think contractual relationships should
be based purely on each party’s own benefits?” I asked. I apologized for theunclear way I asked the question and went on to supplement.
“A purely contractual relationship could be seen, for example, in a sales
transaction where you buy a certain brand of chocolate. In order to fulfill yourdesire to eat something sweet, you pay money to buy the chocolate. The
chocolate company sells the produced chocolate to you to maximize thecompany’s profit and sales. A contractual relationship is no more or no less than
this.”- 69 -

“Now, let me ask you. Do you think your relationship with your school is thesame as this kind of contractual relationship?” I questioned.
Without thinking much, the students answered, “Yes, basically.”“Then let me ask you something else. Let’s say one of you students caused asociety-shocking scandal over summer vacation. For example, several years ago
in Tokyo, one student from a famous university was arrested for farming andselling poppy-derived opium. This was really shocking news, especially in Japan.
Suppose some of you mistakenly joined this kind of business. After you werearrested, the school held a press conference, your principal and vice principal
gave explanations of your mistake and apologized to society. Do you think it isexpected and necessary for your school to publicly apologize? Please raise yourhand if you think so.”To this, everyone raised their hand.
“Then, let me ask you this. If the student that caused the scandal always
bought this certain brand of chocolate, would the president of that chocolatecompany hold a press conference and apologize for that student’s behavior overthe summer?”This time, every student said, “That would never happen.”“So you see. You thought the relationship between you and your school wasa transaction of educational services with each party’s benefit in mind, but isthat really true? The school would apologize for your behavior during summer,
when the school couldn’t really even supervise you. This would never happen
in a purely contractual relationship.”“As long as you live in Japan, you are expecting more than just a contractual
relationship from the school, and the school is actually willing to give that toyou. The school really cares for you. And isn’t that why you care for and love
your school and your class? This relationship is actually a ‘relationship of mutual
trust’,” I explained.
“Mr. Inamori believes that any relationship built, whether private or inbusiness, is basically much better off if it is a ‘relationship of trust’. He believes
trust relationships improve society and enrich lives.”“But when people are bound to self-benefit and act primarily on instincts, they

- 70 -

tend to avoid making trust relationships. Because forming trust relationships
require self-sacrifice somewhere in the process. This is the reason why Mr.
Inamori advocates, ‘Don’t be selfish,’ and ‘Exercise reason.’ If you act free fromthe bonds of desire and act with reason, you will truly be free. And with that
freedom, your normal contractual relationships can be raised to trust
relationships.”
Let me summarize the concept of Inamori “freedom”. His definition of“freedom” is being free from the bonds of physical and physiological laws, tonot be run by instincts and desires, to exercise “reason” that only humans
possess, and to decide your actions based on your own free will andresponsibilities. And that is the meaning of true freedom.
8. Human Relationships are Reflections of the Heart
With the understanding of the core concept of freedom in Inamori Philosophy,
you must understand that this philosophy is not a regression to the past. Rather,it may be thought of as a pioneering philosophy that opens up a whole new roadtowards a more promising future. Furthermore, it may be an anecdote to thetroubles of the younger generation. Feeling this way, I discussed the topic of“friendship” with my students.
“I am sure you all have many friends, and those relationships are certainly
not contractual relationships, but more likely trust relationships. I am sure no
one would deny this. So, let me share with you what Mr. Inamori says about
trust relationships,” I said and read out from his book.
“What can we do to build trust relationships? In my case, at first I tried tofind people that I could trust. That is, I looked for trust outside of myself. Butthat was wrong. I later realized that unless I myself was trustworthy, no trust
relationships could be formed. No friend would come to you unless your own
heart were trustworthy, first and foremost. Trust relationships are reflectionsof your own heart.”11“When he said ‘I looked outside of myself’, it meant he looked for reasons toform the relationships in the other person, with self-benefit as his motive. To
put it straight, he considered his relationships a means to an end. In yourgeneration’s case, it would be something like ‘making friends so as not to feel
isolated in the classroom’.”“That would be ‘looking outside for a reason’. Mr. Inamori is saying thoseselfish motives would not yield ‘true trust relationships’.”11

Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success), p. 94.

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“Let’s say you join a certain group with the motive of ‘not feeling isolated’.
What would you do if that group started to bully someone? If you were to say,
‘We shouldn’t do that,’ you might become the next target and be the one
isolated. So, if your motive to join the group was to ‘not feel isolated’, you would
end up having to also bully that someone along with the rest of the group.”“This is why Mr. Inamori says we should not have motives outside of ourselves
when building relationships. To build a truly trusting relationship, you need to
first show that you are “worthy of trust” on your own, or at least strive to doso, he says.”
High school age is full of relationship problems. Students are as sensitive as
glass and react to the slightest comments from other people and get hurt. It
wouldn’t be feasible to expect total honesty from them, telling them a story likethat. I thought as much and shared another story.
“I imagine that many of you use SNS and email. Don’t you feel insecure or
worry when there are no messages sent to you or you are not sending out
messages? If you do feel that way, it may be because you are ‘looking outsideof yourself’.”“Mr. Inamori says that your relationships are ‘reflections of your heart’. If you
feel ‘insecure’ in a relationship, that relationship can’t be a ‘comfortable
relationship’ to you. This may still be baffling to you, but if you continue
pondering on the words ‘reflections of your heart’, in a few years, maybe when
you are past twenty years old, you would start to see its meaning. Because I
have seen many, many, college students like that, you can trust me. So please,keep these words somewhere in your hearts.”- 72 -

Chapter 7“Mental Attitude” in Inamori Philosophy

The second premise of traditional social philosophies was, “Do not encourage
any specific mental attitude as right”. Proposing a “right way” was perceived asa threat to “freedom”. Therefore, Inamori Philosophy, which advocates a “Right
Mental Attitude”, may be denounced by traditional social philosophies. But“Right Mental Attitude” in Inamori Philosophy does not entail anything
threatening. I would like to show why this is true.
1. What Does a Right Mental Attitude Entail?
“I have explained that in order to build relationships of trust, praise, andrespect, you need to act with a Right Mental Attitude. But I did not explain whatthat “Right Mental Attitude” entails. So, let us look into the details. What did Mr.
Inamori mean by a Right Mental Attitude?”“First of all, when you hear “Right Mental Attitude”, what values come to yourmind?” I asked the students one by one.
“Integrity?”, “Humility, maybe?”, “Honesty,” “Sincerity,” “Not telling lies,”“Being fair,” “Generosity,” “Piety,” etc., the students brought up every virtue
imaginable.
“Thank you. That should be enough. The virtues you have shared are all good
examples of a Right Mental Attitude, but Mr. Inamori did not consider any list of
virtues to be a Right Mental Attitude. He believed that ‘considering what is rightas a human’ to be the ‘Right Mental Attitude’. Do you see the difference?”“What I would like to emphasize in the thinking process of ‘considering what
is right as a human’ is the expression, ‘as a human’.” I gave a moment foreveryone to think about it.
“What do you think the expression ‘as a human’ entail? There must be somespecial meaning for ‘as a human’; it’s not as plants or as animals.” I explained.
The students remained wordless. So I tried again.
“For one, I think it means a human as a social being. Because being ‘human’entails existing among other humans or being a member of society. In otherwords, he encourages people to think not ‘what is right as an individual’ but tothink ‘what is right as a social being’.” I presented this as one definition.
“There is one other meaning behind Mr. Inamori’s expression of ‘as a human’.

- 73 -

It means, ‘as a being with reason’. Plants and animals are considered to bewithout reason, so the expression can be replaced to ‘as a being with reason’. I
have just said, people need to think about what is right as a social being, but
only relying on that aspect could cause another failure. So, Mr. Inamori
encouraged people to think what is right as ‘a social being’ and also as ‘a rational
being’.”“Mr. Inamori encourages people to consider ‘what is right as a human’ because
people have the tendency to fall victim to indulgence and arrogance when givena chance. Let’s say there is a person whose life is going perfectly. No matter
how noble that person’s thoughts are, the temptations of indulgence andarrogance are even more present in success. So, the more successful you are,more thoughtful you must be as a social and rational being, in order to saveyourself from falling victim to temptations, Mr. Inamori says.”“Of course, this might not be easy for young people like you to imagine. I
believe you should pursue your dreams when you are young, without worrying
about anything around you. Just go for your dream and do your best. But, if
you hit a wall, I would like for you to remember what Mr. Inamori said. Ask
yourselves ‘what is right as a human’. I am confident this approach will guide
you over any and all obstacles.”I read out loud.
“To have a conscious life, you should always ask yourself if your decisions
are right as a human, and constantly assess yourself. Be calm and humble
and consciously amend yourself.” “If you find yourself even a little selfish orunderhanded, remind yourself: ‘Don’t think only for yourself,’ ‘Have thecourage to do the right thing.’” “Even if you put in the greatest effort when
you were young, and even if you succeed in your business, there are often
people who fall into the illusion of self-importance, become tyrannical, and letothers down – ‘He/She didn’t use to be that way…’” “No matter how high up
you climb, if you don’t keep checking yourself, be humble, and continuallylearn, it is, unfortunately, human nature to fall.”12
Mr. Inamori considered this to be human nature, therefore he insisted on theneed to “constantly make every effort to think whether what you are doing isright” and “to check yourself daily for even the little things and make
improvements.”13

12

Kazuo Inamori Seikou heno Jyonetsu (A Passion for Success), PHP, 2007, pp. 74-75.
Kazuo Inamori Kokoro wo Takameru, Keiei wo Nobasu (Elevate Your Mind and Expand Your
Business), PHP, 2004, pp. 42-43.
13- 74 -

2. What Traditional Social Philosophies Despise“Now that you know roughly what Mr. Inamori meant by ‘Mental Attitude’, I
would like for you to consider whether the traditional social philosophies would
accept this ‘Mental Attitude’ or reject it. As we have learned again and again,
traditional social philosophies abhor any theory that defines certain values to beright or wrong. Keeping that in mind, would the traditional social philosophies
accept the practice of asking, ‘What is right as a human’?” I questioned.
After a moment, I caught one student’s eyes. She looked like she didn’t meanto speak, but I encouraged her.
“I don’t know, but whatever it is, if there is a certain practice or value that isendorsed, then I don’t think it would be accepted by the traditional social
philosophies.”“Yes. I think it’s natural to think so. I also thought so at first, and I believed
so for a very long time. For example, one religion that values peace and orderturned to merciless atrocity during the Crusades. Recently, under the name ofGod, terrorist groups repeat ruthless murders and inhumanity, calling thesebrutalities ‘sacred war’. It is nearly impossible to deal with. Any group that forcesa certain value with blind intensity is out of control. And so, that is the reason
why traditional social philosophies are wary of and avoided proposing certain
values.”“But as I read Mr. Inamori’s books, I realized that the ‘Right Mental Attitude’
he proposes is far from the practices and values that traditional social
philosophies criticize and abhor. In other words, I realized traditional social
philosophies do not abhor just any value. Even they hold freedom, equality, andfairness as ‘right’ and support/endorse them.”“In that sense, the next thing we need to figure out is what kind of values the
traditional social philosophies actually denounce. If we can figure this out, thenwe will know if the ‘Mental Attitude’ in Inamori Philosophy can be acceptable.
This is what I think…” I continued.
“What traditional social philosophies reject are values that cause
confrontations between people or those that may be used as an excuse to cause
confrontations. There is a pattern in historical as well as current religious
confrontations. The exact words may differ, but they always hold one teaching
to be ‘legitimate’ and all other teachings as ‘heresy’ ‘’. Creating the ‘heterodox
counterpart’ and justifying their own ‘legitimacy’ has always been the strategy
of choice to bring solidarity to the ‘legitimate’ group, against one common- 75 -

enemy.”“On the other hand, Mr. Inamori’s ‘Mental Attitude’ does not bring about
confrontations. It does not strive to justify oneself or one’s group. On thecontrary, it rebukes self-justifications and discourages selfish acts. It is wisdomthat calls for people to ask, for example, ‘Is it right as humans to slaughter in
the name of religion or race?’ or ‘Is it right as humans to eliminate diversity andopinions?’ and encourages self-amends. So in that sense, Mr. Inamori’s ‘Right
Mental Attitude’ should not be, in any way, a value criticized by traditional social
philosophies.”
The students murmured, “I see,” and “Of course.” Feeling good with the
response, I continued.
“To be honest, I think traditional social philosophies should, in fact, applaud
Inamori Philosophy. This is because the cautious way traditional social
philosophies treat values is very similar to the ‘Mental Attitude’ of Inamori
Philosophy. That is, traditional social philosophies rejected promoting certain
values as right because they were wary of people falling into the pitfall of selfrighteousness.”“There is a famous libertarian economic philosopher named Friedrich Hayek(1899-1992). He stated that personal definitions of values are limited, so no
one should force personal values on to others, that people must be humble inthat sense. The desirable behavior is to accept differences in thinking and tocultivate tolerance, he said. Libertarianism (and also New Liberalism) avoided‘Mental Attitude’ in their formula to point out the importance of humility inpeople.”“This is a very important point, so let me reiterate. Libertarianism andsimilarly new liberalism avoided advocating a certain ‘Mental Attitude’ in order
to avoid people from becoming self-righteous and also so that people would
remain humble. This was the real objective - to avoid self-righteousness and tokeep people humble. Traditional social philosophies expected this to be selfevident without particularly emphasizing the intention.”“As a result, what happened? What do you think? Did traditional social
philosophies succeed in building societies where people accept each otherhumbly, as intended?” I asked the students.
I urged a student in the back of the room to comment. She said, “I don’t
really know all that’s going on in the world right now, but I don’t feel there aremany humble or accepting people.”- 76 -

I asked another student sitting next to her. She said, “I don’t know about thepast, but I feel there are many selfish people nowadays.”“Thank you for your comments. I haven’t done any actual research so I don’tknow if there are more humble people in the world or not, but one thing is clear.
There are many people, as you’ve pointed out, who resist other people’s advice
and inputs saying things like, ‘None of your business!’, ‘Who asked you?’ or ‘It’s
my life. I’ll do as I please!’ Traditional social philosophies avoided proposing
values so that people would remain humble and accepting, but as a result, they
may have unintentionally promoted self-righteousness.”“Therefore, if traditional social philosophies still uphold their original intentions,they should be the first ones to agree with the practice of Inamori Philosophy’s‘Right Mental Attitude’. I truly believe so.”
3. Does the Formula Hold True Universally?
In Chapters 2 and 3, we went over the “Formulas” for the Results of Workobserved by the traditional social philosophies as well as their “premises”.
In libertarianism, the premises were that the government (1) collects theminimal tax necessary for defense and peace and (2) eliminates anything that
inhibits market competition. In new liberalism, the premises were that the
government (1) collects progressive tax according to income or wealth, (2)provides employment and educational opportunities and welfare, and (3) enacts
laws to protect equal opportunities for all. But there were no such “premises”
for Inamori Philosophy’s “Formula for the Results of Work”.
It is not that Inamori was wary of market competition or that heunderestimated the roles of governments. Instead, he believes in theimportance of their functions and roles. But in Inamori Philosophy, entrusting
things to the market or the government comes at the very end of things. Thiscan be seen in his consistent focus on first accepting the present situation as itis, and then responding to that situation.
So I presented the “Formula” to the high school students without any premise,and asked them, “Does this Formula seem convincing?” and “Could the Resultsof Work be explained in such a formula?” with the explanation that “EFFORT”
and “ABILITY” had a range of 1 to 10 and “MENTAL ATTITUDE” a range ofnegative 10 to positive 10.
Their responses were, “It explains reality well,” and “It’s convincing.” But one-- 77 -

sided discussions do not reveal anything, so I shared an episode from my lecture
in a business school.
“I used to teach corporate ethics at the Kyoto University Business School.
During one of my lectures, I presented Mr. Inamori’s ‘Formula for the Results ofWork’, to see the students’ reaction. Lo and behold, one student from a foreigncountry, we’ll call student A, raised the hand and said, ‘That Formula doesn’thold true in my country. The Formula would have to be LUCK × MONEY’. Anotherstudent, student B, from the same country was stimulated by the comment andamended, ‘No, no, it would have to be CONNECTIONS × MONEY.’ I was amazedby their directness, but both students A and B were very serious about theircomments.”
I wanted the high school students to see this Formula in a broader picture, so
I also shared the story of a massacre that occurred in Rwanda.
“There is a country in the middle of Africa called Rwanda. It had been a
Belgian colony for a long time. The people of Rwanda were divided into twotribes, Tutsi and Hutu, and Belgium had ruled through a pro-Tutsi policy. They
thought that was a good way to keep control of the Rwandan people. As a result,the Hutu grew more and more resentful of the Tutsi. After World War II, Rwanda
established independence in 1962 among other African nations, but that did notdissipate the bitterness between the Hutu and the Tutsi. In 1994, the tensions
erupted and lead to the atrocities of the Rwandan Genocide.”“Hutu extremists killed 800,000 or more Tutsi and moderate Hutu in a periodof only three months. Whether they were neighbors or co-workers, theextremists murdered the Tutsi and even the moderate Hutu just because theyprotected the Tutsi. No matter what the Formula for the Results of Work was,the Result for the Tutsi was death, just because they were Tutsi, and for themoderate Hutu, death, just because they were ‘kind to Tutsi’.”“The victims of the Genocide might have had the ‘Right Mental Attitude’,especially those moderate Hutu that tried to stop the atrocities. They were
definitely sensible people who tried to practice the ‘Right Mental Attitude’. Butthat did not help them. Rather, that is what killed them.”“Everyone, remember how the foreign exchange students A and B said theResults of Work is decided by ‘CONNECTIONS × MONEY’? To have connections
to power and to have money to buy power is the key to a big business chance,
they said. During Rwandan Genocide, the only way to protect yourself and yourfamily was to hide your Tutsi identity or to join the Hutu extremists.”- 78 -

“In order to survive under those circumstances, and in those countries, one
cannot be leisurely practicing the ‘Right Mental Attitude’. So here is the question
again. What do you think of Mr. Inamori’s ‘Formula for the Results of Work’?”
As expected after such stories, many students started to say things like,“There are limits to the Formula for the Results of Work,” and “Ultimately, it only
holds true in ordinary circumstances.”
4. Difference Between the “Ideal Society” and Reality“But you have all said once, ‘The Formula explains the reality well.’ Are you
taking back what you said previously? Why did you think, ‘It explains the reality
well,’ at first?” I questioned.
This was another difficult question, but one student was brave enough toanswer, “I think, when we answered then, we were thinking of the people
around us.”I asked another student next to her, and she too answered, “We were
probably thinking of life in Japan.”“I see. So you all imagined the relationships and the society around you
unconsciously and answered the first time. That would mean that the Japanesesociety is fairly comfortable for you, correct? Of course, I am sure there aremany unsatisfied people in Japanese society, too. But our class here is overallsatisfied, I understand.”“Going back to our discussion, you all had mentioned that, ‘There are limits
to the Formula,’ and ‘It only holds true in ordinary circumstances,’ but the
Formula is not something that explains the actual reality of our society. I havealready mentioned that ‘Social philosophy discusses how a society should
function’. That, ‘it represents the ideal society’. So, the Formula for the essenceof Inamori Philosophy only illustrates how a desirable society should function.”“I will say this again. ‘The Formula for the Results of Work’ does not explain
the realities of society exactly. The actual situations differ from society to society.
But, although the Formula does not represent reality, it still shows the ‘direction
a society should head towards’ and represents the ‘desirable society’ that mostagree on.”“The reason many people can agree on this formula is because there is noregion or culture in the world that wish the deciding factors of life to be‘CONNECTIONS × MONEY’ or ‘BLOOD/ RACE’. In actuality, there are societies in- 79 -

which connections, money, and blood/race decide the Results of Work. There
are societies where paying money under the table and blood relations decide
the fate of people, no matter their ABILITY, EFFORT, or MENTAL ATTITUDE. But
no one thinks that is an ideal society. No need to get under the veil of ignorance
to understand that. Mr. Inamori was convinced so at a young age, and therefore
has continued to advocate the significance of the ‘Formula for the Results ofWork’ ever since.”
One student raised her hand to ask a question regarding my explanations.
“You said, ‘No need for the veil of ignorance,’ but I don’t quite get it. Why
would societies where ‘CONNECTIONS × MONEY’ or ‘BLOOD/RACE’ influence
the outcome greatly not be ideal? The people of that country or that culture
built those societies, so for them those societies are ideal, aren’t they?”
5. Why the Ideal Societies Prevail“That is a very good question. You are suggesting that, since the actual society
was built by the people themselves, that it must be their ideal society. I have todisagree, though, and here is the reason why.”“Simplified, it’s because ‘the people’ didn’t build the society themselves. I haveto say, the privileged few built the very specific society to serve their own
interests, and it was not the majority of the people that built that society. Thereis no way the three requirements of freedom, justice, and prosperity could be
met by society centered around ‘CONNECTIONS × MONEY’ or ‘BLOOD/RACE’ inthe first place. Such societies would be the furthest from realizing thoserequirements. Let me give you some examples.”“First, think of the people who do not have enough money to pay bribes.
Usually, these people make up the majority of the society, and they would notsupport a Formula of ‘CONNECTIONS × MONEY’. Wouldn’t you agree?” I looked
around the room. Most students nodded in agreement.
“Presently in China, the wealthiest 1% of the population hold one-third of thetotal wealth in the country and the poorest quarter of the population only hold
1% of the total wealth. There is an index called the Gini coefficient which shows
the inequality of a society. The coefficient has a value between 0 and 1, with 1
expressing the maximal inequality. The Gini coefficient for the U.S., which is said
to have a wide gap in wealth, is at 0.39, barely under the tipping point to social
instability commonly understood to be at 0.40. On the other hand, the Gini
coefficient for China is a whopping 0.73, high enough to cause a revolution any
time. This is an extraordinary number!”- 80 -

The class seemed very interested in the inequality issue. The mention of theGini coefficient and China changed the look in their eyes. I learned later thatmany students of this class wanted to ‘work for an international NGO’.
“If the gap in wealth was a result of each person’s ABILITY, EFFORT, and
ATTITUDE, then the inequality may have been tolerated, but according toBeijing University, the greatest cause of the inequality was political. The Chinese
people with the greatest income and wealth were the ones who paid bribes(MONEY) in order to build close relationships (CONNECTIONS) with theCommunist Party and other governmental organizations, as well as those using
their positions as bureaucrats or Communist Party members (CONNECTIONS)
to receive bribes (MONEY).”“Think about it. Would the poor who could not take part in this ‘CONNECTIONS× MONEY’ formula support it? There is no way. Rather, the majority of themwould think themselves the victims of the formula.”“The interesting thing is, even the people who gained wealth with
‘CONNECTIONS × MONEY’ formula know well enough that it could not go on
forever. I can say that with confidence because many of them keep sending theillicit funds to their overseas accounts.”“There is a research organization called the Global Financial Integrity basedin Washington D.C. According to them, China had the largest illicit financial
outflows in the world during the ten years between 2002 and 2011. This amountis said to be $1 trillion. An amount of money greater than that of the Japanesenational budget that flowed out of China. The magnitude is astonishing.”“Simply said, the advantaged few of the ‘CONNECTIONS × MONEY’ society
fear being exposed or future confiscation of their illicit funds. Therefore, they
continue to send money out of the country illegally.”“The present President of the People’s Republic of China Xi Jinping, is fearfulfor the future of the Communist Party in the midst of corruption by party
members and government officials. Therefore, he is rigorously exposing andprosecuting corrupt individuals. There are suspicions that this is an act offactional infighting, but either way, the ‘CONNECTIONS × MONEY’ formula issurely losing its foothold. Ultimately it is because no one really thinks‘CONNECTIONS × MONEY’ formula is desirable.”This explanation seemed to have convinced the student who asked thequestion.

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“Also, regarding ‘BLOOD/RACE’, an intolerant group of people may consider asociety cleansed of all other races as ideal and desirable. But would theeradicated and massacred other race welcome it or support it? Of course, Never.
Even the people who eradicated the others can easily see that such a violent
society is not ideal. That is because violence is always met with retaliation.”“In fact, the Rwandan hostilities spread to the adjacent regions, like thewestern part of the Democratic Republic of the Congo, and are now creating a
brutal cycle of retributions. That same area now suffers the worst human rights
abuse and violence in the world. The people of that region may still resent theother blood or the other race, but they would never think of their lives filled withhatred as ideal.”“As you must understand by now. There are societies in this world where
Inamori Philosophy’s “Formula for the Results of Work” does not hold true. But
even in those societies, there is no one who thinks their current situation is ideal.
Rather, those corrupt or conflicting societies are exactly the societies that most
likely to covet a more ‘ideal formula’ and not their ‘faulty formula’. In that sense,
I am convinced that the Inamori Philosophy Formula holds true in any society”.
What I would like you to conclude from all of this is that the “Right Mental
Attitude” would not be criticized by traditional social philosophies. But that does
not automatically mean that Inamori Philosophy would be firmly supported
around the world. To receive support and to be understood, especially incultures outside of the orient, I must explain the “principles of justice” according
to Inamori Philosophy.

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Chapter 8“Justice” in Inamori Philosophy

Mr. Inamori does not propose an exact system of how wealth should be
distributed within society. Unlike Rawls, who examined the distribution ofincome and wealth extensively and derived principles of justice through a set
method, Inamori Philosophy does not discuss this topic specifically. But when
we extend his Formula for the Results of Work and his underlying philosophy,
we can visualize his perspective on the principles of justice.
The difficult part is figuring out how to derive the principles. I do not believe
a new method is needed. Instead, we can use the methods of Rawls, or actually
I should say we should use them. For Inamori Philosophy to be understood in
cultures influenced by traditional social philosophies, it would be moreconvincing to use an approach already familiar to those cultures. Of course,
Rawls’ methods are not perfect. But in looking at only the justice aspect ofInamori Philosophy, Rawls’ method should be useful enough.
1. Differences Between Inamori Philosophy and Rawls’ Theory of Justice“We have already seen Rawls’ theory of justice. Mr. Inamori, though, has notdeveloped anything similar. I imagine this is because there was no need to doso. But I would like to figure out, with your help, what Mr. Inamori’s principles
of justice would be like if he were to propose his own. You might think thischallenging, but let us just try. We might not get a perfect theory, but I am sure
we can visualize a general idea of Inamori justice - so please give me a hand.”So the students and I resolved to interpret Inamori Philosophy’s principles ofjustice. The first venture was identifying the similarities with Rawls’ theories.
“When we talk about the principles of justice, it would generally concern‘principles of justice regarding distribution’. So as a start, let us go over what
Mr. Inamori thought about ‘distribution of abilities and talents’.”“Do you remember that Rawls considered abilities and talents to be ‘productsof luck’? Therefore he said the results of these abilities and talents should beshared fairly in society. Now then, what does Mr. Inamori think about abilities
and talents? I will read an excerpt from his writings, so tell me what you think
about it later.” I introduced some excerpts from his book.
“I believe a certain percentage of people are born with certain abilities.
There are people born with artistic talents, and there are people born withathletic talents.” “If you happened to be born with those talents, those talentsshould be used for the good of the world, the society, and the community, but- 83 -

never just for yourself. For example, if you are born with the talent ofleadership, you have a responsibility to make use of that leadership ability.
You should never be arrogant about your talent.”14“What do you think?” I asked, and the students replied, “Talents are acquired
mostly coincidentally in society,” “Certain people receive talents by chance,” and“It’s the same as Rawls’ thinking.”“That’s right. That is what I thought, too. So, Mr. Inamori says people blessedwith talent should use it for the good of society, and not just for their own
benefit.”
Confirming this similarity, I pointed out the difference between the two
philosophers.
“Although there is a similarity, there is also a great difference that cannot be
overlooked. This will be a little bit complicated, so please listen carefully. The
biggest difference is in the ‘prior knowledge’ of the person deriving the principles
of justice. We’ve called that person a ‘Hypothetical person’ before, so in otherwords, the prior knowledge of the hypothetical person is different.”“As we learned before, Rawls imagined a hypothetical person under the veilof ignorance and searched for the principles of justice from that point of view.
Under that veil, the hypothetical person would have no knowledge of thedifference between himself and others. I did not tell you all before, but being‘under the veil’ does not mean that you know nothing.”“According to Rawls, there is one thing that the hypothetical person under theveil of ignorance knows. I will call this ‘prior knowledge’ for now. So this priorknowledge - what do you think it is?” I asked.
I knew it was a difficult question, but I took the time for everyone to ponder
first, and then went on.
“That one piece of prior knowledge is this, ‘It is better to have more income
and more wealth, and it is better to have more power.’ So Rawls imagined an
individual with that psyche and examined what kinds of principles of justice that
individual would reach. To put it more clearly, he imagined an unattachedindividual pursuing infinite income, wealth and power and examined theprinciples of justice from that hypothetical individual’s point of view.”“So we now know the ‘prior knowledge’ of Rawls’ hypothetical person. I have
14

Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success) PHP, 2007, p. 185.

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said the biggest difference is in the ‘prior knowledge’ of the hypothetical person,
so what ‘prior knowledge’ should Inamori Philosophy’s hypothetical person
have? What kind of a person would Mr. Inamori imagine to derive his principles
of justice?”
I have already explained that the social unit of Inamori Philosophy is a “person
in association with others”. So in that setting, the Inamori hypothetical person
would want fuller relationships and less damage to relationships. Within that
context, the students should be able to see the prior knowledge of the Inamori
hypothetical person. I thought so and proposed the following.
“The Inamori hypothetical person would probably be interested in increasing
earnings first. Any human would want to earn enough to live. But the Inamori
hypothetical person would not pursue this infinitely because the infinite pursuitof wealth would hurt relationships with others. The Inamori hypothetical person
would also think about sharing the gained wealth with others and with society.
If by doing so, relationships improve, then, the hypothetical person would most
likely share that. A philosophy that considers ‘relationships between people’ as
the basic unit of society would most likely come to the same conclusion,
wouldn’t you agree?” I confirmed with the students.
Fortunately, no student disagreed on this point about prior knowledge.
To recap, the Inamori hypothetical person has prior knowledge that, to havegreater earnings is good, but it is also logical to consider the relationships withothers when acquiring and using those earnings. This is the decisive difference
between Rawls’ philosophy and Inamori’s philosophy.
2. High School Students Behind the Veil of Ignorance
The next undertaking is putting this Inamori hypothetical person with the‘prior knowledge’ behind the veil of ignorance. But this hypothetical person does
not exist in reality. This person is just a figment of our imagination. So deriving
principles of justice from that hypothetical person’s point of view is not an easytask. If we carelessly imagined a biased hypothetical person, we would only
derive an arbitrary and partial principle. But what if there is a person that closely
resembles the hypothetical person? In that situation, we can ask that person
direct questions, and, in doing so, we can eventually derive principles in aclearer and more neutral manner.
While thinking about this, I suddenly had a realization. My students, sitting infront of me, are the perfect Inamori visionaries.

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In Chapter 4, when we went over ‘the case of a hunting village’, they had
pursued their interest in increasing earnings. This means they based theircomments on the prior knowledge that ‘more earnings are better’. Concerningthe ‘prior knowledge’ that ‘it is more logical to consider the relationships withothers when acquiring and using the earnings’, I think the students meet thisrequirement well, too. Here is the reason why.
First of all, high school students are very sensitive to relationships, especiallyfriendships. Since their society is mostly limited to classrooms and school clubs,
if relationships falter, their school life would be miserable. The advanced classthat I taught stayed together all through high school until graduation, so it was
especially true for them. They were very aware of their peer relationships,
maybe more so than the average high schoolers. In that sense, they were ideal
Inamori visionaries.
But in order to develop principles of justice from their perspective, there isone more, bigger hurdle to jump. That is, do they fill the requirement of ‘notknowing where they stand in society’?
Under the veil of ignorance, people do not know where they stand in society.
When turned around, if they do not know where they will stand in society, theywould already be considered under the veil of ignorance. So, how about mystudents?
They are minors about to get out into the real world. In ten or twenty years,
they do not know where they will be in society or what kind of jobs they will
have. Many students wanted to work for Japan Airlines, but many also wanted
to work for international non-governmental organizations. Naming both aprivate corporation and non-profit organizations as possible future work would
certainly qualify them to already be under the “veil of ignorance”. I decided theywould pass the last requirement as well.
But, I did not tell them my analysis. When they hear they are the “ideal
hypothetical person”, they might all of a sudden not act like an ideal hypotheticalperson anymore. I thought they would become too conscious of “priorknowledge” in answering questions if I ever said, “You are the ideal visionaries
under the veil of ignorance.”
If that happened, the “principles of justice” that they were supposed to derivewould come out differently. Therefore, I only told them as a general rule, thatthe prior knowledge of the Rawls’ hypothetical person and the prior knowledgeof the Inamori hypothetical person are different.

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3. Principles of Justice Developed by High School Students
What sorts of principles of justice would the students actually develop? Thatis the important part. I started the process off with the following question.
“Please think of the ‘Formula for the Results of Work’. Simply said, it shows
how to get more earnings. It shows that with a RIGHT MENTAL ATTITUDE andEFFORT, even with not much ABILITY, one can gain good earnings.”“With this in mind, let me ask you; when a person actually executes a Right
Mental Attitude, do you think the action influences not only that person’s own
income and wealth but also other people’s income and wealth, and also when aleader executes Right Mental Attitude, do you think this leader’s action
influences other members’ income and wealth?”
To this question, one student answered, “Yes, I think it does.”“Why do you think the action influences others?” I asked and she answered,“Because that action is executed after questioning what is right as a human andwhat is right as an organization, so of course, it would influence others.”“Precisely. The action is based on consideration of relationships with otherpeople and other members, so there is no way it would not influence others.
But what I would like to know here is, again, would it influence the ‘earnings’ ofothers, and not just influence others in general? Specifically, I would like to know
if it would increase or decrease the income and wealth of others.”
After pointing out the specifics and asking again, I still received, “Yes, it would,”
as the answer from the students.
“I see. Then, what would be the examples of actions that would influenceother people’s ‘earnings’?” “I would like to hear especially the actions based ona Right Mental Attitude that influences others,” I asked.
The students had a hard time, but eventually came up with the following threedeeds with time.
(1)
(2)
(3)

After gaining great income and wealth, using these for the good of theircommunity and society
As a leader, refraining oneself from receiving excessive pay
Not evading taxes“Those deeds are all very straight forward and right on the mark. The actions- 87 -

that you’ve mentioned may be categorized into two groups,” I said and wrote
the three deeds down under ACTIVE DEEDS and PASSIVE DEEDS on theblackboard. Of course, there were many more influential deeds that they raised,
so I added “doing other active deeds” and “not taking part in other illegal or
law-evading deeds” under the list on the blackboard.
CHART 6
Actions that influence income and wealth of others
ACTIVE DEEDS(1) Sharing the fruits of one’s efforts with society(2) Refraining from receiving excessively
Doing other active deeds
PASSIVE DEEDS(3) Not evading taxes
Not taking part in other illegal or law-evading deeds

4. Principles Regarding Active Deeds
After presenting the categorization, I asked the students about the active
deeds. “Does everybody need to equally share the results with society andrefrain from gaining too much?”
After taking some time, the students came up with these answers.
“I think it would be difficult for people with small income.”“I think the privileged people should lead in the active deeds.”“I think the people that enjoy the benefits of society should take initiative.”“I think people should start with small deeds.”“I don’t think there is a need to do more than one can manage.”“Doing more than one can manage might put family and people close at risk.”“Even if the deeds are small and only within one’s capabilities, as long as they
are done with good intentions, one can build good relationships, I think.”
These ideas can be summarized ultimately to; “Proportional and voluntary
deeds are desired.” “Proportional” means, the more income and wealth one has,

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the more active deeds based on consideration for others and the community
one should undertake.
Hearing these thoughts, I said, “I see!” and hoped that they would realize
why they thought so, I asked the following on purpose. “Should the receivingside of the shared earnings and the refrained gains demand to receive them asa right?”
The response was not quick. But after a while, a student in the front seatslowly raised her hand to say, “I don’t think it’s the right of the receiver todemand it.”
“Why don’t you think so?” I asked, and she said, “When it’s demanded, thecontributing side would feel offended.”
I asked the student behind her also, and she gave a similar comment. “Itwould be best if both those helping and those receiving feel good about it, butwhen the deed is an obligation, both sides would feel burdened.”
From their answers, the reason why they felt “proportional and voluntary
deeds are enough” was clear. The reason was so that they can build and nurture
good relationships. They had tackled the problem of distribution justice with the“prior knowledge (that values relationships)” just as I had anticipated.
“We shall bring together the two views that came up: ‘Privileged people thatenjoy the benefits of society should give more back to society’ and ‘Contributionof gains and restraint of excess should not be obligatory’, and call them ‘theprinciples of justice regarding active deeds’.”“By the way, do you think Inamori Philosophy would support your principles?
I can’t say for sure, but I think it would. That is because Mr. Inamori himself
recommends actions proportional to one’s situation. For example, he says there
are things that big corporations can do for the good of society and people, anddifferent things that smaller companies could do. So for small company
managers, to hire even 5 or 10 employees and providing for them and theirfamilies with securely would be for the good of society and people.”15
It goes without saying, Inamori not only recommends that people contributeto society, he continues to do so himself, appropriate to his position. When he
was young, as he asks now of smaller company managers, his pillar of active
efforts was to hire people and keep providing for them. After the company
15

Kazuo Inamori, “Watashi no Koufukuron” Kikanshi Seiwajyuku (Seiwajyuku Journal), Volume
125, February 2014, p. 26.

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stabilized, he thought beyond his own company profits and considered theprosperity of the country. You can see that in his enthusiastic challenges invarious businesses like the telecommunications industry.
Later on, to follow through on his conviction to do his best for the good ofpeople and society, he privately funded and established the Inamori Foundationand the Kyoto Prize to continually, systematically, and comprehensively giveback to society.16 Moreover, as he grew older and continued to work, his belief
that the significance of “work” is in “serving and contributing to society” grewstronger. We can see that clearly in his following words.
“I will continue to work. Because I believe to love and to contribute is thebest way to live.” “There are people who suffer from poverty and handicaps.
This instant, there are children all over the world suffering from hunger, thepossibility of death and in desperate need of help. In order to help thosepeople, even indirectly, with the fruits of our labor is a wonderful ability.”17
I would like to propose the “principles of justice regarding active deeds”
derived by the students as a set of Inamori Philosophy’s “principles of justice”.
5. Principles Regarding Passive Deeds
How about the passive deeds? I asked the students.
“Evading taxes and breaking other laws must be avoided. I am sure we all
realize that, but who should be especially conscious of it?”To this, they answered, “Well, the more privileged you are, more careful you
should be.”The reasons were, “Because there is more temptation,” and “Because the baddeeds of those people at the top would influence the overall society greatly.”“You see the society well.” I felt respect for them and went on to ask. “So, do
the deeds of not evading laws only apply to people at the top of society andlarge companies making profits?”
To this, many students replied, “No, everyone should act that way.” Thereasons being the following: “Because, that’s the most basic thing,” “Because
16

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography) Nihon
Keizai Shimbun, Inc., 2004, pp. 175-182.
17
Kazuo Inamori, Kokoro wo Takameru, Keiei wo Nobasu (Elevate Your Mind and Expand Your
Business), PHP, 2004, pp. 44-45.

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it’s common sense in society,” “Because that’s the least you can do as a memberof a community,” and “Unless you do, you will not be accepted in the society,”among others. They all expressed their thoughts from the standpoint of girls
who value “relationships between people and relationships with society”.
“We’ve just defined ‘the principles of justice regarding active deeds’, but let
us define here ‘the principles of justice regarding passive deeds’ as well. You
have all mentioned that ‘the more privileged you are, or more profitable yourorganization is, more careful you should be to refrain from illegal deeds andevading laws’ and also that ‘no one should take part in illegal or law-evading
deeds’. Let us combine these two together and call them ‘the principles of justiceregarding passive deeds’.”“Would Inamori Philosophy support this second set of principles as well? Yes,
it would be consistent with the Formula of Inamori Philosophy.”18“Let’s say, for instance, there is a company acting in accordance with thelibertarian formula of ‘EFFORT × ABILITY’. Needless to say, libertarianism does
not allow illegal activities, either. Yet, under libertarianism, to come up withways of avoiding taxation and decreasing their taxes legally would draw praiseamong peers as being smart and exercising ‘ABILITY’. To slip through the legal
net by using one’s wit to the fullest would be considered a part of putting in‘EFFORT × ABILITY’.”“But, what do you all think of avoiding taxes? It is a technical term, so let me
explain. Tax avoidance is a scheme to shift the profits of a company from hightax regions where they conduct business to low-tax regions (tax havens) byvarious ways to pay less total tax worldwide. This is not illegal per se, but what
do you think of companies taking such actions or scheming to do so?” I asked.
Most of the students replied, “They shouldn’t do that.”
I asked, “Why not?” The students’ answers included: “That’s foul,” “It’scommon sense to pay taxes where they conduct business, even in high-tax
places,” “Don’t you need to pay taxes where you sell the products?” “How vulgar,
to try and cheat into paying taxes in unrelated places!”“Thank you. I am so moved by your views.” I did not mention it to thestudents this time either, but they were definitely thinking with Inamori
Philosophy ‘prior knowledge’ (valuing the relationship with the society where
the taxes are due) in answering questions about tax avoidance. They were18

Kazuo Inamori, Inamori Kazuo no Jitsugaku Keiei to Kaikei (Kazuo Inamori’s Pragmatic
Studies: Management and Accounting), Nihon Keizai Shimbun, 2000, pp. 151-152.

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commenting as the “ideal hypothetical person under the veil of ignorance”.
“You all know companies like Starbucks, Amazon, Google and Apple? They are
all giant corporations conducting businesses around the world. These ultrafamous corporations have, for a long time, made full use of tax avoidance
schemes to pay less tax overall in the world, just like what we discussed. They
may not have thought of it as being wrong. They probably thought of it like agame. They ran simulations again and again to figure out in which countries
they should pay taxes, or in which countries they should not pay taxes in orderfor the whole enterprise to pay less tax overall, and acted accordingly.”“That ruins their image.” “I didn’t think they were like that.” “How cheap.”
The students were straightforward.
“When companies and people working at those companies think in accordancewith libertarian concepts, this is how they think and act. It creates the mostprofit, and therefore it is the most logical in their minds. But you did not agree.
You thought those companies should pay taxes according to the laws of theregions and countries where the profits were made.”“Specifically, you thought the companies made profit because the consumers
and other companies in the area bought their products, and also the employeesof the company and the company itself gained income because the area offered
opportunities to do business and work, so the company and its employees
should pay taxes in that area according to the benefits gained. You thought thatis the right thing to do as a company and as a human, correct? That is absolutely
wonderful!”
Understandably, the major countries of the world are trying to discourage tax
avoidance of multi-national businesses by establishing a working team at theOrganization for Economic Co-operation and Development (OECD), and framing
regulations to prevent this practice. But the discussions are centered on how tocollect taxes through international cooperation and policy adjustments, and not
on correcting corporate attitude regarding tax obligations, as Inamori
Philosophy proposes.
To organize what we discussed, “principles of justice” under in Inamori
Philosophy can be separated into two categories. It is general, but a person
valuing “relationships between people” and “associations of people” would cometo these conclusions regarding the principles of justice.
Already in Chapter 5, we have looked at present social problems of (1) the
wealth gap, (2) public safety and community deterioration, and (3) abuse of the- 92 -

legal system. Would the two sets of principles that value relationships be of use
in solving these problems? If it helps, then it may supplement traditional social
philosophies in at least the “distribution justice problems” aspect.
CHART 7
Principles of Justice in Inamori Philosophy(1) Principles regarding active deeds(a) Privileged people or organizations that enjoy the benefits ofsociety should strive to actively give more back to society.
(b) The contribution of gains and the restraint of excess are notobligatory.
(2) Principles regarding passive deeds(a) The more privileged people are, or the more profitable anorganization is, the more careful they should be to refrain themselvesfrom illegal deeds and evading laws.
(b) No one should take part in illegal or law-evading deeds.

“Everyone, do you think the principles of justice on active and passive deeds
that we have just derived would help solve present social problems?” “We havementioned the present problems of the wealth gap, public safety andcommunity deterioration, and abuse of the legal system. Do you think Inamori
Philosophy’s ‘principles of justice’ would help in solving these problems?”
The students commented freely on these issues, looking at the principles
written on the blackboard. Here is the list of what they said.
“Since these principles value relationships between people, an excessive
wealth gap would be balanced out naturally, I think.”“The principles encourage the privileged to use self-restraint, so the wealthgap should narrow.”“When the wealth gap is filled, human relations would improve and so should
public safety.”“There would be better community connections if there are more middle-classpeople.”“There should be less need for legal conflicts in close-knit communities.”
In this chapter, we utilized Rawls’ methods to come to the “principles of justice”
that Inamori Philosophy would probably devise.

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They are not Inamori’s own definition. We have only pointed out that withtheoretical premises of Inamori’s philosophy, high school students would cometo this kind of conclusion. Furthermore, we have only suggested the possibility
that these principles would help solve present social problems through thewords of the students. Although only within the comprehension of high school
students, I believe the principles hold a certain truth and persuasiveness. And
Mr. Inamori’s words do not contradict them.
There may be readers who doubt or are unsure of our challenge in this chapter,but let us just for a moment go on with it. Assuming the principles areconvincing, another question arises. It is a question regarding the contradiction
within Inamori Philosophy. “The Formula for the Results of Work” was supposed
to represent that practicing a Right Mental Attitude would result in more“earnings”. But if the principles of justice promote sharing earnings andrestraining gains, personal “earnings” would decrease as a result.
The two sets of principles of justice may influence the distribution structure insociety, but for the practitioner, the principles could work possibly in a negative
way. We must look into this contradiction in the next chapter. At the same time,
we need to see how Mr. Inamori’s philosophical views coincide in real life.
Coincidences or luck are key to solving the contradiction and is deeply related
to the topic of a “prosperous society and life”.

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Chapter 9“Prosperity” in Inamori Philosophy

Inamori Philosophy advocates that the practice of a Right Mental Attitude
will result in more “earnings” (Results of Work), yet on the other hand, it calls
for giving back to society and restraining excess gains as a part of thatpractice. If this is the “principle of distributive justice”, then a discrepancy in
the Inamori formula appears. The practice of a Right Mental Attitude brings anincrease in the income or wealth in others, but a decrease of the income orwealth in those who practice Inamori’s principles of justice. Let me start thislast chapter by clearing up this contradiction.
1. Are the Results of Work and the Results of Life the same?
Traditional social philosophies claim that the results of each person’s efforts
will manifest in a relatively short period of a few years or so. They also claimthat if the results do not culminate in a short period of time, then the problem
lies in the system or the society and therefore people have the right to takeaction to correct it. This was the third premise.
This third premise has two parts: “manifestation in short period of time” and“the right to take action”. Inamori Philosophy would not disagree with“manifestation in short period of time”. That is because many supporters of
the “Formula for the Results of Work” consider the results of a Right Mental
Attitude to manifest itself in a short period of time.
But there are times when the practice of a Right Mental Attitude does not
culminate in a short period of time. Therefore, Inamori Philosophy also
advocates the need to think and act with a longer time span in mind, forexample, of few decades. It states, as long as one does not blame others,
does not abuse the court system, and sincerely puts in continuous effort, evenwhen things do not culminate right away, the deeds will manifest themselves
somewhere in the future.
To confirm this with the students, I covered the left side of the Inamori
Formula and supplemented the following explanation.
“The title or the left side of this Formula is actually not RESULTS of WORK
but “RESULTS of LIFE and WORK”. I had simplified it as Formula for the
Results of Work when I presented it to you. Let me put it back to its originalform of “RESULTS OF LIFE and WORK” now and think about it.
RESULTS OF LIFE and WORK = MENTAL ATTITUDE × EFFORT- 95 -× ABILITY

“When you see LIFE and WORK written side by side like that, what is yourimpression of the relationship between the two?” I asked.
One student commented, “That LIFE and WORK are the same?”
Another student followed with, “Maybe that if WORK goes well, so does
LIFE?”
After that, a student at the front of the classroom remarked, “Maybe itmeans that the Result is the same for WORK and LIFE. But that doesn’t seemright.”
I focused on this third student’s remark.
“It seems like there are multiple meanings, just as you say. But I think weneed to be careful of the word ‘RESULTS’. You’ve just said, ‘It doesn’t seemright that the outcomes are the same.’ It would be a bit odd if the outcomesof life and work were completely the same.”“Many outcomes in LIFE and in WORK overlap, but I don’t believe they are
equal. Because they don’t completely overlap, I think Mr. Inamori wasparticular in stating “RESULTS of LIFE and WORK” to not miss anything, andhe also made a point to put LIFE before WORK.”“Whatever did not manifest as the outcome of WORK would be earned as apart of the outcome of LIFE someday. Mr. Inamori believed so strongly andadded ‘RESULTS of LIFE’ to the Formula to make it a comprehensive conceptthat includes the RESULTS of WORK.
I explained so and drew two circles (Chart 8) on the blackboard. As I havedescribed before, the Results of Work includes earnings such as income, wealth,trust, praise, and respect. These may not manifest in a matter of years. But if
you keep your efforts up without becoming desperate or giving up, somewherein the future you will be rewarded. You will be rewarded within the bigger circleof LIFE outside of WORK. I would like to call it the “double coverage”.
When we cover the Results this way, the aforementioned contradiction may
be dissolved. That is, giving back to society and restraining excess gains might,
in the short run, decrease one’s earnings, but in the long run, would cause anincrease in the area of LIFE.
The students nodded at the double circles on the board. But I added, “I would
like for you to be aware though, that this is just an ‘introductory explanation’.

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In order to understand and appreciate Inamori Philosophy more, you need todive deeper into bigger problems.”
CHART 8
Double Coverage of “THE RESULTS OF LIFE and WORK”

RESUTLS OF LIFE

RESUTLS OF
WORK“But to dive in all at once is quite difficult, so for now, please keep in mind the
double coverage of the ‘Results of Life and Work’ that we just covered,” I
concluded that days talk there.
2. Two Bases for the Prosperity of Society“Okay now, everybody, do you remember that the third objective of a social
philosophy was the realization of ‘prosperity’? So we need to evaluate whether
or not Inamori Philosophy brings ‘prosperity’ or helps to create a prosperous
society.
With that preamble, I began by telling the students the conclusion first.
“First the Conclusion, I believe Inamori Philosophy brings ‘prosperity’ - basedon two things. First, because it was explained that, even when your Ability islimited, Effort and Right Mental Attitude would be rewarded someday. This factgives a lot of people the courage and motivation to go on. The majority of people
do not think they are particularly talented. Therefore, in a society where Ability
decides the Results of Work, only a particular few would feel motivated.”“On the other hand, Inamori Philosophy states that the “Right Mental Attitude”,
and not only Ability, decides life. No matter who you are, if you maintain a Right
Mental Attitude towards work and live each day, a prosperous path will open.
These simple words can change people’s attitude towards work and life, andheighten people’s motivations greatly. Ability is not easy to gain, but what about- 97 -

“Mental Attitude”? I think if you open up, it’s quite easy to amend.”
The students nodded their heads in comprehension. So I asked, “Everyone,
which do you think brings prosperity to society: highly motivated workforce orunmotivated workforce?”
The answer could not have been more obvious, but I asked them to raise theirhands. Everyone voted that a highly motivated workforce bringing prosperity tosociety. Hence, the students recognized that Inamori Philosophy has the power
to bring prosperity to society.
“Thank you. There are no doubts there. So you understand the first basis for
why Inamori Philosophy brings prosperity, but the second basis is a bit confusing.
So let me give you an example to explain it. Imagine a company, and imagine
managers and workers at that company. Let’s hypothesize that this company
conducts business ignoring human rights, labor safety or environmental
protection. These things that I mentioned - human rights, labor safety andenvironmental protection - are responsibilities that companies must abide bylegally, and are expected to practice socially.”“Let’s say there are multiple companies that disregard these responsibilities
and the majority of managers and executives only pursue immediate profits anddisregard legal and social responsibilities. Those companies may round up
children of 10-15 years of age and make them work under dangerous conditions.
They may trick adults into debt and forced labor. They may ignore
environmental laws and drain dangerous chemicals into local rivers. Imagine asociety full of such companies. Do you think a society that tolerates such conduct
can prosper?” I asked.
Maybe the question was hard. The class remained quiet. So I asked thestudents one by one from the front.
Most of the students replied, “Such a society would not prosper,” but one
student commented, “But maybe economically, it would.”
I welcomed her comment in my heart. “Very perceptive. Could you elaborateon what you meant by economically prosper?” I asked her.
“For example, I think there are nations that prosper economically even though
they have environmental issues like pollution,” she added.
“I see. That is true. In reality, many countries actually developed economicallyas they experienced issues like pollution. That is very perceptive of you.” I- 98 -

supplemented and expanded.
“What we probably need to do now is to think about the word ‘prosperity’. For
example, if an economic indicator such as GDP (gross domestic product) was
the sign of ‘prosperity’, societies that ignore legal and social responsibilities could
be regarded as ‘economically prosperous. But I would like to ask you, do you
think a society that ignores children’s human rights and destroys theenvironment can enjoy ‘prosperity’ for long? Would you call such society a‘prosperous?”
To this question, the students answered, although in various different words,“That is not ‘true prosperity’.”“Good. There was a mention of ‘true prosperity’ now. What does that mean?
Everyone, what is the meaning of ‘true prosperity’?” I ventured.
The students were at a loss for an answer, but the one student who made theperceptive comment before, raised her hand to say, “I think ‘true prosperity’ isa ‘long-lasting prosperity’.”“Exactly. Unless it’s sustainable it cannot be called ‘true prosperity’. We should
redefine ‘prosperity’ in this way. Inamori Philosophy is a wisdom that brings‘true prosperity’ to societies. Because it urges people and companies to do theright thing, it naturally contributes to sustainable prosperity.”
Everyone seemed convinced, but I wanted to go over this one more time tomake sure they grasped the whole picture. So although it seemed redundant, I
summarized what we discussed.
“Before we go on to the next topic, I would like to recap. The object of social
philosophies was the realization of ‘freedom’, ’justice’, and ‘prosperity’. We havestudied how Inamori Philosophy realizes ‘prosperity’, and there were two bases
for this. The first was because Inamori Philosophy, particularly the Formula, canraise people’s motivations. The second was because the Formula changes
people’s or the companies’ Mental Attitudes and urges the protection of humanrights, labor safety, and the environment.”
3. Negative Setbacks and Sustainable Prosperity“Okay, everyone, now that we have examined the bases of how Inamori
Philosophy brings ‘prosperity’ to society, there is one more thing that we needto think about. That is, no matter how mindful one is of a ‘Right Mental Attitude’
or how legally and socially responsible an organization is or how earnest the- 99 -

managers and workers of the company are, there are unforeseen disasters,
destructions, and economic depressions that devastate what has beenaccomplished by these people and organizations. We call those incidents‘coincidental disturbances’.”“We’ve already covered that, if you look at things over a long time span, a‘Right Mental Attitude’ would be rewarded someday. But I also mentioned that,‘This is just an introductory explanation,’ and, ‘In order to understand andappreciate Inamori Philosophy more, you need to dive deeper into bigger
problems.’ Those ‘bigger problems’ are actually these coincidental disturbancesand how one goes about dealing with them.”
To demonstrate the connection between coincidental disturbances and“sustainable prosperity”, I attempted the following explanation.
“As you know, there are times when, even though people and organizations
act according to the Formula, uncontrollable events obliterate all their hard work.
In times like this, people may lose the will or power to go on working and living.
Their motivations may diminish suddenly. Organizations may collapse in the faceof this kind of unavoidable fate.”“Let’s say a company highly acclaimed for human rights, labor, andenvironmental issues meet a devastating fate suddenly. That company’s
managers and workers and even the bystanders may start to say, ‘Working hardon human rights and labor safety and environmental protection wasmeaningless!’”“People may begin to think the ‘Formula for the Results of Life and Work’ isuseless in the face of coincidental disturbances. What do you think will happen
to the society then? Most likely, there will be no more people or organizations
practicing the ‘Right Mental Attitude’ and ‘sustainable prosperity’ would not berealized. Don’t you think this is true?” I waited for their nods.
They did. They understood in their own way that if the validity of the “Formula”
was in doubt, social prosperity would be lost.
But the risk to prosperity isn’t limited to this one situation. One more situation
may impair prosperity, and that situation is the exact opposite of everybody
doubting the Formula; meaning that everybody blindly follows the “Formula for
the Results of Life and Work”. So I told the students, “There is one totally
opposite situation that I have to mention,” and started the next talk.
“Let’s say the majority of people insist the ‘Formula for the Results of Life and- 100 -

Work is an exact representation of reality. What do you think will happen insociety? I have said that social philosophies do not represent the ‘actual
situation of society’ but ‘an ideal society’ before, and this is true for the‘Formulas’ as well. So when the majority of people blindly believe that the‘Formula’ explains reality exactly and that there are no coincidental disturbances,it may ruin prosperity. Can you understand why?” I asked the students.
It was a difficult question, so I asked, “What if a person met a misfortune
coincidentally, and everyone said, ‘That’s because you don’t have a Right Mental
Attitude’ or ‘You must have brought it on yourself.’? Would you call this aprosperous society?”
The students said, “Oh, I see.” and “That’s how it turns out.” and realized thepoint I was getting at.
We’ve already pointed out that Libertarianism can create a society that is very
cold towards vulnerable people, but Inamori Philosophy Formula, when used
wrongly, can also fall into the same pitfall. To not repeat this mistake, I stressed
the following.
“Everyone, please don’t forget - Inamori Formula should be used explicitly
only as a guide to how one should live one’s own life into the future. That is the
purpose of Inamori Philosophy and the correct use of the ‘Formula’ as a humanbeing.”
4. How to Deal with Coincidences“We have defined prosperity as ‘sustainable prosperity’. A society where
people’s satisfaction with their lives would be sustainable. Oppositely, in asociety where everyone desires ‘more income and more wealth’, a sustainable
prosperity may remain an unattainable dream, because each person isunsatisfied with their situation and is constantly unhappily craving for ‘more’.”“So to summarize all this, it can be said that a society’s prosperity depends
on how each person deals with their own situation, fate, and life. I believe thisis true. But the really hard thing is when a happily thriving person suddenly
meets an unforeseen incident and faces devastation.”
Mr. Inamori believes that inborn abilities are distributed by chance, just as
new liberals do, but his “Formula” does not explain explicitly about “coincidences”
one meets in life. But that does not mean he regards them lightly. Rather, hebelieves coincidences are actually crossroads in life decided by fate.

- 101 -

According to him, when people have good luck they may think, “This luck andsuccess are the fruit of my efforts, and well deserved.” When that happens, a
successful person “loses humility, lets up earnest efforts, becomes conceited,
and wishes for more luck and more success”.19 On the other hand, when met
with disaster, hardship, and trouble, a person may grieve their bad luck, feel
lost, hate the world, and envy others. Both good and bad luck carry within thepossibility of failure.20
Portraying the meaning of coincidence in this way, Inamori states, “There are
no uneventful lives. Whether you encounter the tests of good luck or bad,” youmust practice a Right Mental Attitude and face the tests humbly and positively.21
This means, even when things do not work out according to the Inamori
Formula, you must try to “practice a Right Mental Attitude”. Now, what doesthat mean?
“When a content person meets a sudden accident and falls in the pits of misery,
what do you think that person should do? If there were some fault in that person,then he/she could amend their ways, but if it was an incident outside of theircontrol, like a natural disaster or a massive accident, how should that person
deal with it? When things that can’t be explained by the ‘Formula’ occur, should
you still try and practice the ‘Right Mental Attitude’ according to the ‘Formula’?”Mr. Inamori explains coincidental disturbances and practice of the Formulausing the words “fate” and “law of retribution” respectively.
“’Fate‘ may be already decided. It is not something that we can influenceby our will. But the ‘law of retribution’ that works simultaneously with ‘fate’ isnot. Applying this ‘law of retribution’ can change even the ‘fate’ that’s
supposed to be set. We call this fulfilling everyone’s destiny.22
Based on these words of Mr. Inamori, I asked the following question to thestudents.
“Mr. Inamori instructs us to face misfortunes positively and to go forward with
our lives and that by doing so, we would change our own fate. He thinks thisattitude would make one’s life more full. But students, do you think these words
19

Kazuo Inamori, Inamori Kazuo no Tetsugakujin ha Nanino Tameni Ikirunoka (Philosopher’s
Purpose in Life), PHP, 2003, pp. 124-125.
20
Kazuo Inamori, Inamori Kazuo no Tetsugakujin ha Nanino Tameni Ikirunoka (Philosopher’s
Purpose in Life), pp. 126-127.
21
Kazuo Inamori, Inamori Kazuo no Tetsugakujin ha Nanino Tameni Ikirunoka (Philosopher’s
Purpose in Life), pp. 127-128.
22
Kazuo Inamori, Inamori Kazuo no Tetsugakujin ha Nanino Tameni Ikirunoka (Philosopher’s
Purpose in Life), p.115.

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would help people in the pits of misfortune?”
I walked slowly to the back of the class and asked one student.
She answered honestly, “Well, I’ve never experienced anything like that, so I
wouldn’t really know.” It would be a hard question to imagine for exuberanthigh school girls, I thought it over and told a hypothetical story.
“Let’s say after graduating college, you get married, and are blessed with adaughter. She is your legacy, your most precious, extraordinary treasure. You
nurture this daughter with all your love. But at the age of three, she suddenly
passes away and goes to heaven.”“Can you accept the misfortune of your daughter’s death right away saying,‘Oh well, it was fate,’? I don’t think so, no way. You would go crazy with grief.
And you would blame yourself again and again, thinking you should have been
there for her. It is such a wrenching torment that you would soon blame others
too. You would cry and grieve day after day and in the end, resent heaven andeven curse God.”“To lose your beloved daughter is a misfortune too agonizing to bear. To deal
with this fact, to face the future, and to go on is easy to say, but not somethingthat can easily be done. Your deepest love for your daughter is something no
one can truly understand, after all. Would you still accept your daughter’s deathas ‘fate’?”The class froze still. No one could speak. So I asked a student in the front row
for a thought.
Slowly, she said, “I think I would be too devastated to deal with it.”After her comment, I went on to ask the class, “Then I would like to ask allof you. Why do you think this beloved daughter of yours came to you? Why wasshe born to you, why did she live with you for three years, and then go toheaven?”
It was a tough story. The class remained soundless.
“Do you think she was born in order for you to ‘grieve day after day’? Do you
think she would be happy to see you in such condition…?”“She would never want to see you like that. No child wants to see their beloved
parents unhappy. Don’t you think…? If you see that, there is only one thing that- 103 -

you can do, although it is very tough. That is to celebrate the proof of your
beloved daughter’s life.”“A proof of her life?” they seemed to say.
“That can be done by you fulfilling your life. Your beloved daughter must havetaught you through her death ‘the importance of feeling another person’s pain,of standing by people and supporting each other.’ It is an unbearable grief, butthat child has left you with ‘important wisdom’ that you can use to becomecontent. It may take time, but to think so and to deal with your fate is the only
way to save yourself from the pits of grief. I believe that is what Mr. Inamori
meant by dealing with misfortunes and moving forward with life.”
The students seemed to understand from my story that this is the only way
to overcome fate and that in the end, this is what brings prosperity to life. But
at the same time, I was painfully aware that there are limits to imagining
unexperienced tragedies. It is true for me too, but the difficulty of dealing withdeath is an agony that only those who have experienced it could understand. A
parent’s love for the children never ceases, even when they seem to haveovercome the loss.
There are other possible tragedies, too. Each one of us will at some point face
unexpected grief and suffering. “Deal with both good and bad fortune and stay
positive” is understandable in words, but very difficult to practice, which is all
the more reason to learn from someone like Mr. Inamori, who has experienced
all kinds of hardships and overcome them all.
5. What Does the Example of Mr. Inamori’s Life Suggest?
We have studied Inamori Philosophy as a social philosophy, focusing on the“Formula for the Results of Work”. And we have particularly looked at how
earnings are distributed in society and how people should go about acquiring
earnings. In concluding this book, I must mention that the more one practices
Inamori Formula throughout their life, the more the purpose of practicing the
Formula itself disappears from one’s mind.
When I say the purpose, I mean that the practice would cease to be motivatedby “the Results of Life and Work”.
There are two approaches to the study of business ethics: teleological(consequentiality) approach and deontological (moral duty) approach. Whenexamining whether a certain action is ethical, an ethicist would judge the validityof an action using these two approaches. The teleological approach would- 104 -

consider an action to be ethical when that action brings good outcome to Life
and Work. Contrastingly, the deontological approach considers the outcome tohave no relevance, but “what is morally right” should be the judge of action.
Using these two approaches to rephrase “purpose of practicing the Formula
itself vanishes from one’s mind”, it would be this: teleological thinking makes aleap to deontological thinking. Not everyone experiences this leap of attitude,
but if it happens, that person’s life is sure to become more prosperous,
especially spiritually.
In Chapter 7, we described, “What is right as a human” as examining what is
ethically right from a “social standpoint”. This actually is self-questioning basedon the teleological. That is because it is a rational analysis of whether a certain
action would be accepted, valued, and appreciated by “others” or whether in a
few years or decades it would result in some form of an outcome within the
double coverage.
But when a leap towards deontological thinking starts, “what is right as ahuman” sublimes to “what is right as a rational, elevated being who is different
from plants or animals.” We have elaborated on “freedom” in Inamori
Philosophy as freedom of will to decide what should be done based on reason,
free from the chains of physical and physiological laws and desires. This is“freedom” in deontological thinking, too.
I would like to emphasize, though, this does not mean a teleological approachis inferior and a deontological approach is superior. Rather, unless a person
practices “a Right Mental Attitude” based on teleological thinking and repeats
the practice, the person would not reach any deontological thoughts. There are
no instant leaps.
The young Mr. Inamori believed in the Formula and had put in efforts andideas to gain results. With a belief that right intentions and passion would makeanything possible, he devoted himself to research and development (R&D) andsales expansions. When those efforts brought visible results in the marketplace,
his attitude towards conducting business extended.
His Mental Attitude “for the good of the company and the employees”
extended to include “for the good of the nation, its people, and society at large.”
Then the “Formula for the Results of Life and Work” slowly disappeared fromhis mind. The practice of “a Right Mental Attitude” and the act of living ethicallyitself, became his joy, as we can see.
6. Mr. Inamori’s Life-Story- 105 -

Now, I have said that people reach deontological thoughts by repeatedly
practicing the “Right Mental Attitude”. But that is not to say that one should
simply practice the “Right Mental Attitude” from the start without weighing theoutcomes of the “Formula for the Results of Life and Work”. The deontologicalpractices are an after-effect. The process should be a repetition of effort to gain
more earnings by practicing the “Right Mental Attitude”, hitting a wall, correcting
one’s “Mental Attitude”, and going on further: a process of zigzagging to reach
one’s life goals.
Hoping that my students would lead such lives, I shared Mr. Inamori’s lifestory with them.
“I believe life is a process of pushing forward through the zigs and the zagsof life. I especially regard the positive spirit in the face of mixed events as key
to a more prosperous life. I feel this way because the story of Mr. Inamori’s life
demonstrates it.”
“Mr. Inamori contracted tuberculosis at the age of thirteen and had been on
the brink of death.23 After graduating from college, he could not get into thecompany he had hoped to, and he was said to have been devastated. Wandering
the city in Kagoshima, he even thought, ‘The world is so full of injustice andinequality, the poor cannot get out. Isn’t the underworld full of connections andsentiments and chivalry so much more human? Maybe I should just join the
Yakuza (Japanese mafia).’”24“This was not his only disappointment. His first job after he graduated college
was at Shofu Industries. The company management was in horrid conditions
and salaries were paid behind schedule. As he recalls, ‘Both my research andrelationships at the company failed. I used to go out to the cherry tree lined
creek behind the dormitory and sit by the water, singing the nursery rhyme‘Furusato’ (hometown).’ ‘ My heart ached with accumulated wounds that I did
not know how to deal with, so I sang out loud to cheer myself up.’”25“He must have been really lonely and hurt. But he did not disregard his work.
He consistently put effort in with a positive attitude. In February of 1958, Mr.
Inamori left Shofu Industries, but it was his positive attitude that attracted
seven of his colleagues to follow him.”

23

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography) Nihon
Keizai Shimbun, 2004, pp. 31-32.
24
Kazuo Inamori, Zero Karano Chousen (Challenge from Zero), PHP, 2012, p. 104.
25
Kazuo Inamori, Seikou heno Jyonetsu (A Passion for Success), PHP, 2007, p. 87.

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“That story brings tears to my eyes every time I think about it. These sevencolleagues came together in his room and took an oath on the founding ofKyocera. ‘We gather here united, we vow to achieve goodness to the world andwith its people, and hereby seal our oath with blood.’ Doesn’t the passion of
those about to embark on a dream strike you?”26“Of course, the newly founded business did not get on track right away. Big
corporations in Japan did not take the fledging Kyocera seriously. So in the
1960s, Mr. Inamori took a plunge and visited possible business partners around
America and Europe. He tried to develop new business ties through these trips,
but no sales were made in spite of his efforts. It is said that, stranded in aforeign country, he was mortified with guilt, and cried in anguish.”27“Kyocera began to grow quickly after that, but in 1985, the company washarshly criticized by society for a violation of the Pharmaceutical Affairs Act. This
criticism was the result of the company’s bone and cartilage products being
provided to some patient before they had been officially approved by thegovernment. For this action, the government banned Kyocera from this area of
business for a period of time. There was media coverage about it daily andKyocera faced its biggest crisis since it was founded. As the leader of thecompany, this scandal must have been an experience of agony beyond
description for Mr. Inamori.”28“Also in the 1980s, Mr. Inamori envisioned going into a totally different fieldof business. After contemplating over it for half a year, he decided to establish
a company called Daini-Denden (DDI). You all have a cellular phone, right? And
you know how cell phone companies compete against each other. But in the
mid-1980s there was only one telephone company (Denden Kosha or thecurrent NTT) and no competition. This monopoly was reproached and theprivatization of Denden Kosha became a big discussion. But no private company
would challenge a monster of a company like Denden Kosha. Everyone thought
there was no way any company could have a chance of competing against
Denden Kosha.”“Amidst all of this, Mr. Inamori was the first to take up the challenge. This
challenge, if it failed, could cripple Kyocera, so in July of 1983, he stood before
Kyocera executives to explain the ‘social significance’ of facing this challenge.
We call this moral significance or moral cause. There were three causes here:

26

Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography), p.74.
Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography), pp. 8892.
28
Kazuo Inamori, Inamori Kazuo no Gaki no Jijyoden (Kazuo Inamori’s Autobiography), pp.
149-151.
27- 107 -

to lower the expensive phone connection fees in Japan, to contribute to thehealthy progress of the information society, and through those effects, tostrengthen Japan’s competitive edge and bring prosperity to the people of Japan.
Mr. Inamori talked passionately that if DDI pursued these moral causes andconducted business according to them, then the challenge would be worthwhile
and rewarded.”29“It was like an ant challenging an elephant. The executive members musthave been overwhelmed by the sheer magnitude of the undertaking and very
noble cause. I can’t help but suspect that there were at least a few Kyocera
executives who thought, ‘This is too reckless!’”“In the end, after receiving consent from within Kyocera, an announcementof DDI’s entry into the telecommunications market was made. To their surprise,
the announcement was made soon after by two bureaucracy-led coalitions
expressing intent to enter the market also. The first was a group of companies
led by Japan Highway Public Corporation (present NEXCO) and the second wasa group led by Japan National Railways (present JR). They both indicated theirplans to facilitate fiber-optic networks using their highways and railways
respectively.”“Mr. Inamori’s DDI was in a tight spot. The situation may be expressed as
being caught between a tiger (Denden Kosha) and two wolves (Japan Highwayled group and Japan Railways-led group). DDI was far behind Denden Kosha infunding and technology to begin with, and the entry of the two companies
completely took away the option of installing and using optical fiber networks.”30“Under the circumstance, demand for a pull-out of DDI grew daily. But Mr.
Inamori took the predicament positively, followed moral causes, did what must
be done, and prevailed. As a result, in 1987, all three companies (DDI, Japan
Highway-led group, and Japan Railways-led group) officially started longdistance telephone services, but the two bureaucracy-led coalitions that had
what should have been the winning edge fiber-optic networks suffered fromdeclining performance and earnings, and had to revise their business schemes
fundamentally. In hindsight, Mr. Inamori’s DDI was the most successfully andconsistently growing company of the three. That DDI is the present day KDDI,by the way.”29

Kazuo Inamori, Atarashii Nippon Atarashii Keiei (New Japan, New Management), PHP, 1998,
pp. 136-141. Kazuki Shibusawa, Inamori Kazuo Dokusen ni Idomu (Kazuo Inamori Challenges
Monopoly), Nihon Keizai Shimbun, 2012, pp. 13-15.
30
Kazuki Shibusawa, Inamori Kazuo Dokusen ni Idomu (Kazuo Inamori Challenges Monopoly),
pp. 51-55.

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Recognizing the company name, KDDI, the students looked at each other,
impressed.
“I have said that life is a process of zigzagging your way forward, that the
Mental Attitude of dealing with life’s ups and downs positively will bringprosperity to your life. Don’t you agree with me after hearing Mr. Inamori’s life
story?” I said and wrapped up my lectures with the story of his revitalization ofJapan Airlines (JAL).
“The end of June 2010. This was the day JAL needed to present a
reorganization plan to the bankruptcy court. But Mr. Inamori extended the due
date to the end of August. It’s a bit technical, but the reorganization trustees
and those concerned with the Enterprise Turnaround Initiative Corporation ofJapan begged Mr. Inamori to keep the officially pledged due date, but he did not
bend in his conviction and extended the presentation by two months. Some said
if he can’t even keep his due date, there is no way he can revitalize the company.”“Why do you think he extended the deadline against all this?” I asked thestudents, and they were eager to put in their thoughts.
“Maybe there was a lot to do,” one student commented.
“Maybe lots of new problems came up,” another student put in.
“Maybe the original plan was unrealistic,” other students commented.
I wanted to hear other thoughts, but we were running out of time. So I went
on to conclude the lecture.
“If you remember, I have already mentioned that JAL drafted many
reorganization plans before bankruptcy. You may have forgotten, but JAL
executives wrote and rewrote plans and changed their target figures manytimes. They had revised them every year. On top of that, the government andpolitical parties came in and the plan was revised by them again and again. The
problem was that none of those plans were ever accomplished.
“The reason why they were unaccomplished was, ultimately, because it wasnever clear who was responsible for accomplishing those plans. Every one ofthe plans was drafted by just a small team, with a vague impression thatsomeone else would actually execute those plans. Mr. Inamori’s group thought
this ‘sidestepping of responsibility’ was the true cause of JAL’s demise.
Therefore, unless leaders were trained to have a will strong enough toaccomplish the company’s goals responsibly, JAL’s revitalization would remain- 109 -

a delusion on paper. I have mentioned the leader training program before, andthat was one of the major reasons for the two months extension of thereorganization plan’s presentation.”31“Thank you all for your attention to the end. What I told you here are just bits
and pieces of what Mr. Inamori proposed and experienced. But I hope you saw
that he overcame many hardships, setbacks, and discouraging difficulties todeepen his philosophy and his passion to practice a ‘Right Mental Attitude’.”“So please, face forward, all of you, and follow your dreams with all yourenergy. If you ever hit a wall, don’t despair and don’t give up. Instead remember
what you have learned here. Open up your notes, and ask yourselves, ‘What isright as a human?’ If you do that, you will find your way.”“I have shown that Inamori Philosophy, the philosophy that Mr. Inamori
reached after many hardships, is a precious social philosophy that can augment
the limits of traditional social philosophies. I feel Inamori Social Philosophy holds
great significance and possibilities. I would like to stress this as my conclusionof the lectures. Thank you all very much for your honest comments and lively
discussions. I have thoroughly enjoyed our talks. Thank you.”

31

Iwao Taka “JAL Saisei, Futatsu no Kokoromi wo Waketa Mono” Kyocera Keiei Tetsugaku Kifu
Kouza (Kyocera Funded Management Philosophy Course), Kyoto University Graduate School ofManagement, 2014, pp. 59-61.

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Epilogue
In concluding this book, I would like to present one practice we should learn
from Mr. Inamori. I believe this story is something he would never touch on
himself, unless someone like me told it.
Mr. Inamori constantly has expressed, “Goodness is something that isuniversally right, and universally right means that it can be recognized andaccepted in any one’s eyes. Things cannot be achieved by only pursuing one
person’s profit, convenience, or face-saving. The motive must also be
acceptable to others.” “In other words, you need to ask yourself, ‘Is this selfish?’
You need to check that you are not conducting business based on your own
selfish thoughts or self-centered ideas.” “I strongly believe that if the motive isgood, and the process is good, there is no question about the outcome- it will
be a certain success.”32 Therefore, when he was requested to rescue JAL, hesays he constantly asked himself, “Is the motive good?” and “Is this selfish?”
At the end of 2009, the government and the Enterprise Turnaround Initiative
Corporation of Japan requested that Mr. Inamori take the position of chairman
for JAL. He declined based on his inexperience in the air transportation industry,
but the government’s persistence finally convinced him to accept. On thisoccasion, he asked himself about the noble reasons of revitalizing JAL, and came
down to the following three causes.33 Then he vowed to conduct himself strictly,
without any self-interest, based on those three causes.
(1) If the revitalization of JAL were to fail, the whole Japanese economy would suffer.
(2) The remaining employees of JAL and their families should be protected.
(3) If the air transportation industry loses competitiveness, the flying public will suffer.

On February 1, 2010, Mr. Inamori officially took over as Chairman of JAL.
Some said, “He is tarnishing his twilight years,” but because he was certain of
his three noble causes, these comments were complete nonsense to him.
He set about his new challenge with conviction that, “If the motive is good,
and the process is good, there is no question about the outcome - it will be acertain success,” but there were many obstacles before the eventual company’s
relisting. A magazine article in August of 2012 was especially assaulting. The
title read, “Easy Money on 5 Billion Yen Unlisted Shares! The ‘GREED’ of Kazuo
Inamori Privatizing JAL”.

32

Kazuo Inamori, Kokoro wo Takameru, Keiei wo Nobasu (Elevate Your Mind and Expand Your
Business), PHP, 2004, pp. 208-209.
33
Kazuo Inamori, Zero Karano Chousen (Challenge from Zero), PHP, 2012, p. 196.

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The article alleged the following: of the allocation of new shares to a third
party (in an amount of ¥12.7 billion or about $120 million) issued by JAL on
March 15, 2011, ¥5 billion worth (¥2000 per share) were acquired by Kyocera,
Kyocera acquired the shares knowing that JAL was starting to perform well, andKyocera would realize an enormous profit with the relisting of JAL (onSeptember 19th, 2012). Because of this magazine article, politicians andbusinessmen, pre-bankruptcy JAL shareholders, and many intellectual figures
expressed outrage; accusing and attacking Inamori’s actions.
I think this must have been the most gravely disheartening accusation for Mr.
Inamori. He made a point to conduct himself with the purest of intentions, andpushed himself through bad health to rescue JAL. Yet the broader society waslabeling as “greedy” and attacked him with these accusations. A normal person
would have been enraged. But Mr. Inamori simply explained what needed to beclarified regarding the accusations, did not make excuses, did not hold a grudge,
did not sue the magazine for defamation, and quietly endured with patience.
Common sense should have revealed the article totally absurd. But becauseof the amazing turnaround of JAL in an unprecedented short timeframe, alongwith the magnitude of profits, Mr. Inamori’s efforts only appeared to suspicious
minds as “greedy privatization by the chairman”. According to the reorganization
plan presented to the court beforehand, the operating profit projection for 2010
(ending in March 2011) was ¥64.1 billion. As it turned out, the actual profit wasa figure far above forecasts of ¥188.4 billion.
In Mr. Inamori’s honor, I would like to make clear that the allocation of newshares was nothing like an insider deal. JAL originally made financing requests
to more than a few dozen companies, planning to issue ¥500 billion worth in
new shares. But due to the Great East Japan Earthquake of March 2011, manyof those companies were uncertain of their cash reserves and declined therequest for funding as a result.
This may be improper to say, but amidst all the rejections, there were only
eight companies remaining that, for various reasons, could not decline. Kyocera
and JAL’s managing underwriter Daiwa Securities, were in the position to ask
the other six companies to support the funding burden, and thereby each had
to finance an increased amount of ¥5 billion.
The other six companies that agreed to provide financing were insurancecompanies and travel agencies. I was once a board member of a major property
and casualty insurance company, which leads me to say, that property andcasualty insurance companies consider airline companies to be very importantbusiness clients. Therefore, if a major airline company requests funding, there- 112 -

is no way, policy-wise, for the insurance companies to decline. Considering thevolume of business transactions between travel agencies and airlines, it musthave been the same for travel agencies as well. This is the background story ofthe ¥12.7 billion total which was barely collected by the eight companies.
In spite of all this, the magazine published scorching criticism. I say this again,
an ordinary person could not have suppressed their rage. Kyocera management
board and employees must have been so upset by the false allegations. Mr.
Inamori’s wife of sixty years, Mrs. Asako Inamori, who has shared both joys andsorrows with him, must have been devastated, too. Nonetheless, Mr. Inamori
endured. In light of all this, I would like to share his following words.
“In your long lives, there will come times of disappointment and suffering.
But especially in those times, you must hang on and sincerely work towards
your ideals. The heavens will most definitely bow to such efforts, sincerity,and diligence.”34 “I decided that if I could truly believe that what I was doingright, then I would climb to any heights, overcome any obstacles, take any
criticism, and keep on going towards my goal. And I kept demanding ofmyself and others the same unyielding attitude.”35
Kazuo Inamori was exposed to unexpected accusations during therevitalization of JAL. He experienced the torment of ungrounded criticism, but
he always kept his word. He continued practicing a Right Mental Attitude andfaced every hardship in a positive way. The true value of Inamori Philosophy
specifically lies here. He did not just keep his thoughts in his head; instead heevolved them into an inspiring philosophy through their practice. Because he isa philosopher of action, his following words on life comparing it to a voyage
must inspire many readers.
“If we were to compare life to a voyage on a great ocean, inorder to lead life on the exact course of our wishes, we would
have to paddle ourselves incessantly. But that would probably
not take us far. We need to prepare our ships to catch otherforces like the wind to propel us forward.
I believe the act of raising your sail and waiting for the wind,especially the act of raising the sail, is exactly the process ofraising yourself to betterment.

34

Kazuo Inamori, Kokoro wo Takameru, Keiei wo Nobasu (Elevate Your Mind and Expand Your
Business), p. 62.
35
Kazuo Inamori, Kokoro wo Takameru, Keiei wo Nobasu (Elevate Your Mind and Expand Your
Business), p. 65.

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If you think about it, there are not many things that can beachieved merely by your own power. Most things are only
possible with other people’s support. But in order to receive
support, you need to raise your sail on your own. The act ofraising your sail entails purifying your heart and pursuing ‘Whatis best for others’ and not just for yourself. This means that it isimportant to have an unselfish attitude.
A sail raised with a selfish heart of, ‘me, me,’ is full of holes.
Even if the wind blew, it would just blow through the holes, andthe ship would not pick up speed. On the other hand, a sailraised with a noble heart is a marvelous sail. It would surely befull with the wind of support.”36
I would like to again, show my respects to Mr. Inamori’s philosophy andactions. At the same time, I hope this book sheds a new light on theunderstanding of Inamori Philosophy. I sincerely hope the new generations of
the 21st century appreciate the value of this “next social philosophy” we unfolded,
and endeavor to build a prosperous society with hope and confidence.

36

Kazuo Inamori, “Watashi no Koufukuron” (My Theory on Happiness) Kikanshi Seiwajyuku(Seiwajyuku Journal), Volume 125, February 2014, p. 25.

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