The problem of Immanence v.s. Transcendence is one with relevance to any spiritual tradition, but it has special resonance for Buddhists. Simply put we may say that if Buddhahood is absolutely transcendent then we are cut off from it; and if Buddhahood is absolutely immanent then we are not released from suffering by attaining it. Clearly a Buddhist approach will be to take a middle way. But what are the practical implications of this?
I want to look at some of the approaches to this problem in the history of Buddhism, and show that Kukai came up with a highly creative solution to the problem.
While the Buddha, and perhaps his first few generations of Awakened disciples, lived there was less of a problem with immanence or transcendence because there were living exemplars. However in the Pali texts there is some concern for the way in which one can Awaken. One text which has had a huge influence on the Western Buddhist Order in this regard is the Upanisa Sutta from the Samyutta Nikaya. This text describes a progressive series of steps: suffering, faith, joy, rapture, calm, bliss, concentration, knowledge and vision of things as they are, withdrawal, dispassion, freedom, knowledge of the destruction of the mental poisons. Sangharakshita has called this the spiral path, and it is also sometimes called the 'positive nidanas' (although this is not a traditional term). Bhikkhu Bodhi wrote a pamphlet about the sutta and the idea, using the term Transcendental Dependent Arising after the Nettipakarana. The idea of a progressive path is present in a number of other suttas as well.
The key point here is that through practice - of awareness, of meditation - one can go through a series of stages which culminate in Awakening. The Upanisa Sutta offers an elegant solution to the problem. Unfortunately it seems Buddhists, including the guardians of the Pali Canon, lost sight of this important teaching and so over the centuries had to come up with a number of other solutions.
One Theravada approach is represented by Peter Masefield's book Divine Revelation in Pali Buddhism. Masefield argues that is it necessary to meet a Buddha in person in order to Awaken, that the possibility of becoming Awakened died with the Buddha. His thesis is remarkably easy to refute because although he bases it on a large number of quoted examples from the Pali Canon, he has overlooked many counter examples. Many people become Awakened without direct contact with the Buddha - thousands in the Therigatha alone. The position is one in which the Buddha is absolutely transcendent. We could also adopt a higher criticism approach to counter Masefield's literal reading of the texts as well, but that would take up more space than I have here.
The problem of Immanence v.s. Transcendence underlies the doctrine of the two truths which is central to the later Mahayana. The absolute truth says that Awakening is beyond the reach of language, ie it is transcendent. However if Awakening is absolutely transcendent, then we can not experience it, and so we have the relative truth. The relative truth says language is able to point to Awakening without actually encompassing it, or perhaps that language can describe the path, but not the goal, ie that Awakening is immanent.
The most prominent amongst the later theories is the Tathagata-garbha or Buddha Nature doctrine. In this theory each being already contains a germinal Buddha only waiting for the right conditions in order to manifest. Spiritual progress is often perceived in terms of clearing away defilements which obscure our true nature. The kind of practice most closely associated with this theory are generically called "formless". The quintessential practice is zazen, or 'just sitting'. The 'object' of meditation is simply the play of the experience arising and passing away.
However there are problems with the Buddha Nature theory. Buddha nature is often described as indestructible and eternal. There is a clear conflict with the doctrine which proclaims that everything is impermanent. Also if every being has Buddha Nature and we accept a theory of rebirth, then it creates a problem in that our Buddha Nature must transcend our death(s). How does this Buddha Nature follow us through the cycles of birth and death? Buddha Nature begins to sound all too like the Upanishadic idea of an Atman. A further problem is that it open the way to adopting the wrong view that we are already Awakened and need make no effort to change.
In the early 9th century when Kukai was introducing esoteric Buddhism to the Buddhist intelligentsia of Japan, the general view seems to have been that Buddhahood takes three incalculable aeons to attain. This is a more or less infinite amount of time - from any point of time Awakening is always sometime in the very distant future, and therefore essentially unattainable. The view comes from an over literal reading of Mahayana sutras. Yes the Buddha did have to spend aeons perfecting the perfections, but again the stories of the Pali Canon which show disciples regularly Awakening in very short spaces of time seem to be lost. Since practice cannot result in Awakening, it is directed towards mundane ends such as the prosperity of the emperor and the empire. Another aspect of establishment thinking was that the Dharmakaya was absolutely abstract, that there was no possibility of contact with it - ie that the Buddha was absolutely transcendent in the final analysis.
Kukai's great catch cry was "Awakening in this very existence!". So how did he overcome the immanence/transcendence problem? Kukai's approach was a radical take on the theory of interpenetration which is central to the Avatamsaka Sutra. Although the idea of interdependence is not found in the Pali Canon it is a logical consequence of "things arising in dependence on causes". If everything depends on causes then everything must depend, indirectly at least, on everything else. Kukai believed that interpenetration was the nature of reality and that nothing at all was left out of this, including crucially the Buddhas and Bodhisattvas. If everything is permeated by the Awakened mind of the Buddha, especially in his Dharmakaya aspect, then Awakening is immanent not just in beings, but in every atom of the universe. He seems to have taken to heart the image from the Avatamsaka Sutra which describes the universe as a great sutra, the letters of which are the items of experience (dharmas).
This approach gets around the problems inherent in the Tathagata-garbha approach. If we accept that there is any possibility of Awakening, then we are in contact, however faintly, with Awakening. In this theory practice consists of making the most of our connection by making our body speech and mind conform to those of the Dharmakaya via the medium of mudra, mantra, and mandala.
Kukai rejected the idea of an absolutely transcendent Dharmakaya - largely as far as I can tell on the basis of Nagarjuna's rejection of the validity of the existence/non-existence duality. Although it is incorrect, in his view, to state that things exist, it is equally wrong to say that they do not exist. The relationship is one of dependent arising, of course. It is not always obvious because of his esoteric approach to practice, but in many ways Kukai was a back to basics Buddhist.
The idea that Awakening is possible here and now, is a necessary corrective. It is explicit in the Pali Canon, and contra Masefield, there is no reason to believe that the conditions of the present preclude Awakening. Although I find Kukai's solution to the problem attractive and creative, I also see it as unnecessarily complex. In the absence of the early teaching on progressive conditionality, it is probably the next best thing, and at least it holds open the possibility of the Awakening in the present.