Shaping a New Society: Conversations on Economics, Education, and Peace
Shaping a New Society, an extended dialogue between Lawrence J. Lau and Daisaku Ikeda, is a lucid examination of the components of a peaceful, flourishing twenty-first century world. The book opens with an exploration of the financial challenges and opportunities of our time, including close analysis of lessons to be learned from the 2008 financial crisis and keys for shared prosperity across East Asia. These discussions are rounded out by conversations focused on the attributes of successful humanistic higher education, a topic of intimate knowledge and concern for both authors. At the heart of the dialogue is the conviction that success and prosperity cannot be considered apart from the educational systems that mold our citizens.
“These conversations between two distinguished educators offer a host of interesting insights. Topics range widely, including prospects for Japan, China, and Hong Kong and reflections on the global economy and how it can more fully succeed for the world’s populations. What shines through most vividly is a commitment to the value of humane education and an eagerness to explore what this entails amid the many challenges of the contemporary world.”
—Peter Stearns, Provost Emeritus and University Professor, George Mason University
“Shaping a New Society captures an insightful dialogue between two respected thought leaders, who interweave a cogent discussion of economics with a shared vision for a humanistic education. Organized around eight conversations, the discussion examines a wide range of issues that are at once historical and contemporary, backward and forward looking, and that tie together personal introspection with a far-reaching concern for society. Ikeda and Lau ground their exchange in wisdom that comes from scholarship, experience, and faith, to deliver with humility their hopes for a more prosperous, peaceful, and joyous world.”
—Zeena Zakharia, Assistant Professor of International and Comparative Education, University of Massachusetts Boston
Lawrence J. Lau was Professor of Economics at Stanford University from 1976 until 2004, when he became sixth Vice Chancellor of the Chinese University of Hong Kong, serving in that position for seven years. His many publications include The Chinese Economy in the Twenty-first Century: An Econometric Approach.
Daisaku Ikeda is president of the Soka Gakkai International, a lay Buddhist organization with more than twelve million members worldwide. He has written and lectured widely on Buddhism, humanism, and global ethics.
CONVERSATIONS
1. Economics for the People
2. Hong Kong’s Potential
3. Successful Higher Education
4. The Joy of Learning
5. The Path of Friendship
6. Prospects for East Asia
7. Learning As Growth
8. Economics for Happiness
Appendix 1. Proposal for the Normalization of Japan-China Relations—Daisaku Ikeda
Appendix 2. Bonds of Bilateral Friendship Must Never Be Broken—Daisaku Ikeda
Appendix 3. Regional Cooperation for Resilience —Daisaku Ikeda
Appendix 4. Sharing in Best Practices for Human Talent Development—Daisaku Ikeda
Appendix 5. Lessons from the Global Financial Crisis—Lawrence J. Lau
Appendix 6. Selected Works—Daisaku Ikeda
Appendix 7. Selected Works—Lawrence J. Lau
Notes
Index
About the Authors
Excerpts from Conversation Eight by Lawrence J. Lau and Daisaku Ikeda
IKEDA: Because the economy is vital to both the individual and society, people are quick to criticize and question its efficacy.
Responding concisely to my question about what kind of twenty-first century he wanted to see, Galbraith said that he hoped it would be an age in which people found life in this world to be a joy and a time when killing had come to an end. Galbraith lived through two world wars and believed strongly that we must not allow war to break out again. He insisted that politics, economics, and science were basically means to advance the welfare and wellbeing of humanity, but because modern society had lost sight of this, these fields had instead become ends in themselves.
I was struck by his forthright, astute belief that economics must serve human happiness. However, while many acknowledge that the study of economics is important, there are some who find the discipline complex and difficult to understand. How would you describe the workings of an economy in modern society?
LAU: In a country or region, an economy is a system for the determination of, first, the assignment of the primary factors of production, including capital, labor, and natural resources, to enterprises and organizations, including governmental organizations and their compensation; second, the type and quantity of goods and services, including capital and consumer goods and services, that are to be produced by these enterprises and organizations, and the pricing of these goods and services; and third, the distribution of these goods and services to the different enterprises, organizations, and households for use as intermediate inputs or to be consumed. Whether an economy is a centrally planned one, a market one, or a mixed one, it must fulfill these necessary basic functions.
In addition, the government is responsible for the financing (through taxes and the issuance of public debt, if necessary) and provision of public goods, such as education, health care, national defense, public security (including firefighting and police protection), and public infrastructure. The government also has the responsibility for the stabilization of the economy (to smooth out the cyclical fluctuations of the economy and to control inflation), the promotion of full employment, and the support of sustainable long-term economic growth.
Further, the government is responsible for the redistribution of income through income taxes and transfer payments, so that the gains of economic prosperity can be better shared by all. The provision of public goods, such as education, medical care, environmental preservation, pollution control, and public parks, by the government can be a very effective ‘in kind’ redistribution mechanism.
IKEDA: Thank you for clarifying the relationship between economic activity and government. Governance is truly a skilled craft. The challenge of politics lies in balancing economic growth with enhancing the quality of people’s lives and ensuring that this effort is stable and sustainable.
Toda often told us that individual happiness should never be sacrificed at the altar of social prosperity; rather the two must advance hand in hand. I believe there is a growing urgency for economic activity to not only focus on efficiency but also the greater public good.
*
IKEDA: In Japan today, young Japanese are finding it difficult to hope for a better future—which comes as no surprise, given the number of jobless youth, the expansion of nonpermanent or irregular employment, the growing number of the working poor, and other uncertainties they face. How does this compare with Hong Kong?
LAU: Hong Kong faces many of the same problems. Many young people are not optimistic about their future prospects.
Part of the problem arises from the gradual disappearance of well-paying jobs. Manufacturing jobs have largely disappeared from Hong Kong, to either mainland China or to Southeast Asia, a result of the rising degree of globalization. (Automation and robotics have not yet affected Hong Kong but have had a significant impact in the United States.)
The advancement in information and communication technologies has also caused many middle-level managerial positions to become redundant, as the span of control of senior management expands, and the organization of an enterprise becomes flatter and flatter.
For example, in a commercial bank, there used to be layers of middle management between the president and the tellers—not anymore. It is possible for a single senior vice president to monitor the work of a thousand lower-level employees. The same information and communication revolution has also enabled even the back-office jobs to move away to lower-cost locations elsewhere. The result is a diminution of advancement of opportunities and rising disparity in the distribution of income.
What can be done about these problems? They are not easy to solve in the short run. I have advocated for Hong Kong and elsewhere to create jobs that cannot be moved away—for example, jobs in the tourism industry and in industries that cater to tourists. However, these are by and large low-paying jobs. If young people are to aspire to greater opportunities, they should consider going north.
Just as the ambitious young Americans responded to the call of “Go West, young man!” in the nineteenth century, the young people of Hong Kong should do the same; they should venture into the mainland, the land of opportunities and, of course, of risks. But if there is no risk, there can be no gain; if one does not take some risks when one is young, when will one take risks?
IKEDA: Young people should indeed dare to tackle ambitious goals.
Description
Shaping a New Society, an extended dialogue between Lawrence J. Lau and Daisaku Ikeda, is a lucid examination of the components of a peaceful, flourishing twenty-first century world. The book opens with an exploration of the financial challenges and opportunities of our time, including close analysis of lessons to be learned from the 2008 financial crisis and keys for shared prosperity across East Asia. These discussions are rounded out by conversations focused on the attributes of successful humanistic higher education, a topic of intimate knowledge and concern for both authors. At the heart of the dialogue is the conviction that success and prosperity cannot be considered apart from the educational systems that mold our citizens.
Advance Praise
“These conversations between two distinguished educators offer a host of interesting insights. Topics range widely, including prospects for Japan, China, and Hong Kong and reflections on the global economy and how it can more fully succeed for the world’s populations. What shines through most vividly is a commitment to the value of humane education and an eagerness to explore what this entails amid the many challenges of the contemporary world.”
—Peter Stearns, Provost Emeritus and University Professor, George Mason University
“Shaping a New Society captures an insightful dialogue between two respected thought leaders, who interweave a cogent discussion of economics with a shared vision for a humanistic education. Organized around eight conversations, the discussion examines a wide range of issues that are at once historical and contemporary, backward and forward looking, and that tie together personal introspection with a far-reaching concern for society. Ikeda and Lau ground their exchange in wisdom that comes from scholarship, experience, and faith, to deliver with humility their hopes for a more prosperous, peaceful, and joyous world.”
—Zeena Zakharia, Assistant Professor of International and Comparative Education, University of Massachusetts Boston
Author(s)
Lawrence J. Lau was Professor of Economics at Stanford University from 1976 until 2004, when he became sixth Vice Chancellor of the Chinese University of Hong Kong, serving in that position for seven years. His many publications include The Chinese Economy in the Twenty-first Century: An Econometric Approach.
Daisaku Ikeda is president of the Soka Gakkai International, a lay Buddhist organization with more than twelve million members worldwide. He has written and lectured widely on Buddhism, humanism, and global ethics.
Table of Contents
CONVERSATIONS
1. Economics for the People
2. Hong Kong’s Potential
3. Successful Higher Education
4. The Joy of Learning
5. The Path of Friendship
6. Prospects for East Asia
7. Learning As Growth
8. Economics for Happiness
Appendix 1. Proposal for the Normalization of Japan-China Relations—Daisaku Ikeda
Appendix 2. Bonds of Bilateral Friendship Must Never Be Broken—Daisaku Ikeda
Appendix 3. Regional Cooperation for Resilience —Daisaku Ikeda
Appendix 4. Sharing in Best Practices for Human Talent Development—Daisaku Ikeda
Appendix 5. Lessons from the Global Financial Crisis—Lawrence J. Lau
Appendix 6. Selected Works—Daisaku Ikeda
Appendix 7. Selected Works—Lawrence J. Lau
Notes
Index
About the Authors
Excerpts
Excerpts from Conversation Eight by Lawrence J. Lau and Daisaku Ikeda
IKEDA: Because the economy is vital to both the individual and society, people are quick to criticize and question its efficacy.
Responding concisely to my question about what kind of twenty-first century he wanted to see, Galbraith said that he hoped it would be an age in which people found life in this world to be a joy and a time when killing had come to an end. Galbraith lived through two world wars and believed strongly that we must not allow war to break out again. He insisted that politics, economics, and science were basically means to advance the welfare and wellbeing of humanity, but because modern society had lost sight of this, these fields had instead become ends in themselves.
I was struck by his forthright, astute belief that economics must serve human happiness. However, while many acknowledge that the study of economics is important, there are some who find the discipline complex and difficult to understand. How would you describe the workings of an economy in modern society?
LAU: In a country or region, an economy is a system for the determination of, first, the assignment of the primary factors of production, including capital, labor, and natural resources, to enterprises and organizations, including governmental organizations and their compensation; second, the type and quantity of goods and services, including capital and consumer goods and services, that are to be produced by these enterprises and organizations, and the pricing of these goods and services; and third, the distribution of these goods and services to the different enterprises, organizations, and households for use as intermediate inputs or to be consumed. Whether an economy is a centrally planned one, a market one, or a mixed one, it must fulfill these necessary basic functions.
In addition, the government is responsible for the financing (through taxes and the issuance of public debt, if necessary) and provision of public goods, such as education, health care, national defense, public security (including firefighting and police protection), and public infrastructure. The government also has the responsibility for the stabilization of the economy (to smooth out the cyclical fluctuations of the economy and to control inflation), the promotion of full employment, and the support of sustainable long-term economic growth.
Further, the government is responsible for the redistribution of income through income taxes and transfer payments, so that the gains of economic prosperity can be better shared by all. The provision of public goods, such as education, medical care, environmental preservation, pollution control, and public parks, by the government can be a very effective ‘in kind’ redistribution mechanism.
IKEDA: Thank you for clarifying the relationship between economic activity and government. Governance is truly a skilled craft. The challenge of politics lies in balancing economic growth with enhancing the quality of people’s lives and ensuring that this effort is stable and sustainable.
Toda often told us that individual happiness should never be sacrificed at the altar of social prosperity; rather the two must advance hand in hand. I believe there is a growing urgency for economic activity to not only focus on efficiency but also the greater public good.
*
IKEDA: In Japan today, young Japanese are finding it difficult to hope for a better future—which comes as no surprise, given the number of jobless youth, the expansion of nonpermanent or irregular employment, the growing number of the working poor, and other uncertainties they face. How does this compare with Hong Kong?
LAU: Hong Kong faces many of the same problems. Many young people are not optimistic about their future prospects.
Part of the problem arises from the gradual disappearance of well-paying jobs. Manufacturing jobs have largely disappeared from Hong Kong, to either mainland China or to Southeast Asia, a result of the rising degree of globalization. (Automation and robotics have not yet affected Hong Kong but have had a significant impact in the United States.)
The advancement in information and communication technologies has also caused many middle-level managerial positions to become redundant, as the span of control of senior management expands, and the organization of an enterprise becomes flatter and flatter.
For example, in a commercial bank, there used to be layers of middle management between the president and the tellers—not anymore. It is possible for a single senior vice president to monitor the work of a thousand lower-level employees. The same information and communication revolution has also enabled even the back-office jobs to move away to lower-cost locations elsewhere. The result is a diminution of advancement of opportunities and rising disparity in the distribution of income.
What can be done about these problems? They are not easy to solve in the short run. I have advocated for Hong Kong and elsewhere to create jobs that cannot be moved away—for example, jobs in the tourism industry and in industries that cater to tourists. However, these are by and large low-paying jobs. If young people are to aspire to greater opportunities, they should consider going north.
Just as the ambitious young Americans responded to the call of “Go West, young man!” in the nineteenth century, the young people of Hong Kong should do the same; they should venture into the mainland, the land of opportunities and, of course, of risks. But if there is no risk, there can be no gain; if one does not take some risks when one is young, when will one take risks?
IKEDA: Young people should indeed dare to tackle ambitious goals.