THE UNITED STATES AND JAPAN
Our conference today follows one on the art and character of leadership that Dr. Inamori and I chaired two years ago at the Center for Strategic and International Studies in Washington. The initiative was inspired by Dr. Inamori's book, For People and For Profit. More specifically, that CSIS conference focused on leadership, creativity, and values in a variety of areas, including politics, the business world, and even sports and entertainment. In all these areas, we looked at the character dimension, and the following week a number of U.S. Members of Congress joined in these discussions.
Today's follow-on conference in Tokyo focuses on some practical problems for U.S. and Japanese political and business leadership, within our respective countries and between our countries. Remember our two nations, with the world's largest economies, command close to 40% of the global GNP. We bear special responsibilities to the world community.
In my comments today, I would like to draw attention to a particular kind of business and political leadership that is urgently needed today. This is "transformational leadership" a term coined years ago by Professor James MacGregor Burns, a famous American Presidential historian. The term is used in contrast to "transactional leadership." Good transactional leaders are managers of what they have in hand and make limited incremental progress on modest goals, making best use of given resources. What Burns calls transformational leaders, on the other hand, have a teaching role. They elevate, motivate, define values, offer vision, and creatively produce reform and at times revolutionary developments in the face of unusual opportunities and challenges.
In my country, Abraham Lincoln was a transforming leader who preserved the Union and ended slavery; the two Roosevelts were also transformers; the first, Theodore, through what is called the Progressive Movement, and the second, Franklin Delano, through the New Deal social safety net and later wartime leadership. The Roosevelts' transformation involved centralizing power and giving the Federal Government a larger role in society. This was needed at the time.
By contrast, in different times, Ronald Reagan transformed our Federal government by decentralizing power, seeking a smaller Federal government with more reliance on governors of states, mayors of cities, and the private sector using the creativity of the market economy. In the earlier part of the last century, we needed to centralize more of government. Toward the century's end, with the …