Robert Nozick, John Rawls and the Common Criticism of Moral Merit

The central points of A Theory of Justice by John Rawls are certainly the two principles of justice that he derives as a result of the negotiation of rational subjects in the original position and behind the veil of ignorance. We have discussed this theme in detail in various Mind the Economy dedicated precisely to Rawls. The 'principle of freedom' is the one to which the greatest importance is attributed - a lexicographic priority, as the philosopher writes - but it is certainly the second principle, that of 'difference', that most characterises and distinguishes the Rawlsian proposal by its originality. This second principle in its first formulation reads: "Social and economic inequalities must be combined in such a way as to be (a) reasonably expected to benefit everyone; (b) linked to offices and positions open to all". Rawls himself acknowledges that the expressions 'to the advantage of each' and 'open to all' can be ambiguous, so he takes the trouble to discuss them at length in order to clarify them and provide the correct interpretation. Each expression - 'the advantage' and 'openness' - is independent of each other and can be specified in at least two different ways. Positions 'equally open to all', in fact, can mean either a 'formal equality of opportunity' or a more stringent 'substantive equality of opportunity'. The expression 'to everyone's advantage', on the other hand, can be interpreted simply as a matter of economic efficiency or as a distribution that responds to the logic of the difference principle, a distribution, that is, according to which, as Rawls writes, 'the expectations of those in a better situation are fair if and only if they function as part of a scheme that improves the expectations of the less advantaged members of society'. Combining these two possible declinations for each of the two dimensions of the difference principle, four possible interpretations can be generated. Rawls calls the 'system of natural freedoms' the interpretation that results from combining pure efficiency and formal equality of opportunity; he calls 'liberal equality' the interpretation that results from combining efficiency with substantive equality of opportunity; 'natural aristocracy' is what emerges when the difference principle and formal equality are considered together; and, finally, 'democratic equality' is what results from combining the difference principle and substantive equality of opportunity. The authentic interpretation that Rawls proposes and defends is the latter, where the second principle of justice appears more consistent with the entire construction of his theory. What emerges is a conception according to which substantial equality of opportunity is necessary to overcome the unjust inequalities arising from what Rawls calls the 'natural lottery' that determines morally irrelevant advantages and disadvantages. Being born male or female, into a certain family, in a certain place at a certain time in history and with skin of a certain colour rather than another we know are all factors that have a determining influence on the opportunities open to individuals regardless of their talents, abilities and determination to put them to use. But they are factors over which individuals cannot exercise any control and must therefore be considered morally irrelevant. A distribution of income and wealth that is predominantly determined by such factors cannot, therefore, be described as fair. The second issue relevant to 'democratic equality' is the impossibility of settling for the Paretian efficiency principle alone. There are in fact a virtually infinite number of alternative allocations that satisfy the Paretian efficiency criterion. These are all those allocations that lie on the so-called 'transformation curve' where all productive factors, from physical to human capital, are utilised to their fullest extent. One such allocation, of all possible allocations, will see all wealth concentrated in the hands of one individual. This distribution is efficient in the Pareto sense because it is impossible to increase the wealth of even one person without reducing the wealth of someone else. This distribution, therefore, is efficient, but we can hardly consider it also fair.  

The question of the interpretation of the second principle of justice is important at this stage of our discourse because it constitutes one of the main targets of Nozick's critique of Rawls. While the latter, in fact, advocates 'democratic equality', Nozick sticks to the diametrically opposite interpretation, what he calls the 'system of natural freedoms'. The first point of difference concerns equality of opportunity. Whereas for Rawls it must be substantial, for Nozick formal equality is sufficient. That is, it is enough that every citizen legally has access to certain opportunities. Rawls, on the other hand, requires that all differences linked to the birth lottery be compensated for in some way in order to make equality of opportunity a concrete fact and not merely a declaration of principle. "There is no reason," Rawls writes in this regard, "to allow the distribution of income and wealth to be determined by the distribution of natural endowments rather than by historical or social chance," and he goes on to state how "Even the willingness to try, to strive, and to be therefore deserving, as we normally understand it, depends on a happy family and social circumstances. It is this point with which Nozick disagrees and which he finds completely unfounded. His critique goes so far as to question the compatibility of such a deterministic view of individual choices with the ideal of dignity that A Theory of Justice would promote and with the Kantian approach of the 'separateness' of human beings on which Rawls, as well as Nozick, moreover, bases his critique of utilitarianism. "This line of argumentation," Nozick writes, "can only succeed in blocking the introduction of a person's autonomous choices and actions (and their results) by attributing everything noteworthy about the person to certain kinds of 'external' factors. Denigrating in this way a person's autonomy and fundamental responsibility for his or her actions is a risky line to take for a theory that otherwise aspires to reinforce the dignity and self-respect of autonomous beings; dangerous especially for a theory that is based in so many respects (including a theory of the good) on people's choices. It is doubtful that the unexciting image of human beings that Rawls' theory presupposes and on which it is based can be made compatible with the idea of human dignity that it seeks to induce and incorporate" (p. 224). Nozick on this point, as we can see, is very harsh. But the lunge goes on to argue that Rawls has in fact in no way demonstrated that rational agents in the original position would reject a system of freedom in which natural endowments can (at least in part) determine the distribution of income and wealth. Since Rawls is silent about the reasons for his position, it is Nozick who tries to find arguments to support it. 'Positive' and 'negative' arguments are introduced and then dismantled one by one. The 'positive' arguments are aimed at establishing why the distributional effects of natural differences must be nullified. The 'negative' ones, on the other hand, seek to refute a possible counter-argument that argues that the distributional effects of natural differences should not be nullified.

Nozick identifies four possible 'positive' arguments. The first has the following structure: a) every person should morally deserve income and wealth; b) there should be no wealthy people if they have not earned such wealth; c) if a person's X partially determines his Y, and his X is undeserved, then so is his Y; and finally d) people's wealth should not be even partially determined by their natural endowments.

These kinds of arguments would, of course, be possible, but Rawls, as Nozick points out "explicitly and emphatically rejects distribution according to moral merit". Rawls writes, in fact, that 'Common sense tends to assume that income and wealth, and in general the good things in life, should be distributed according to moral merit. Justice is happiness according to virtue. Even if it is acknowledged that it can never be fully realised, this ideal represents the appropriate conception of distributive justice, at least as a prima facie principle, and society should attempt to realise it to the extent permitted by circumstances. But justice as fairness rejects this conception; such a principle would not be chosen in the original position'. Thus Rawls seems to reject moral merit as a distributive criterion. Not only that, but he is inclined to incentivise the most gifted for their best achievements when these can also generate benefits for the most disadvantaged. Overpaying an entrepreneur who innovates may be fair even if this increases inequality. Provided that the entrepreneur's innovative action can, for example, generate jobs that improve the economic conditions of the most disadvantaged in particular. Nozick, on this point, also recalls von Hayek's position that in a market society the distribution of earnings is usually determined by the ability of individuals to respond to the needs of others. This capacity is at least partly correlated with natural talents, which thus indirectly determine the distribution of wealth. Thus, 'The principle of the system,' writes Nozick, 'is not distribution according to natural endowments; but differences in natural endowments [which] will lead to differences in possessions in a system whose principle is distribution according to recognised services rendered to others' (p. 227). In the famous example of Wilt Chamberlain that we discussed in Mind the Economy 76, the wealth that the player earns does not derive directly from his natural gifts and athletic abilities, but from the use he makes of them by putting them at the service of spectators and basketball fans. Chamberlain's ability to cater to the tastes and 'needs' of fans is reflected in their willingness to pay to see him play.

Having refuted one by one the "positive" arguments that Rawls could have invoked against the moral arbitrariness of distributions based on natural endowments, Nozick tries to imagine another set of "negative" arguments, capable, that is, of subverting possible counter-arguments. One point must first be reiterated: the disagreement between Nozick and Rawls is not about the illegitimacy of an allocative mechanism that determines the distribution of resources on the basis of individuals' natural endowments. In fact, both philosophers agree on this point. Merit cannot be based on something 'inherited' - the genes, the family, the place of birth, etc. - and over which the individual does not exercise control. - and over which the individual exercises no control and therefore no moral responsibility. The difference lies in the fact that while Rawls stops at the condemnation of this allocative criterion without arguing further, Nozick tries to go a step further by demonstrating that if we replace the concept of merit with that of "valid title", the founding pillar of his theory of justice, then it would be possible to consider economic inequalities legitimate because these would be nothing more than, in a historical vision of justice like that of the New York philosopher, the result of a concatenation of just actions. Nozick's idea is simple and astute. Let us try to consider what would happen to the argument in favour of the arbitrariness of natural endowments that Rawls criticises if we were to replace the term 'merit' with the expression 'title to'. The argument would take this form: 1) people are entitled to their natural endowments; 2) if there is anything to which people are entitled, they are entitled to whatever derives from their natural endowments; 3) people's possessions derive from their natural endowments, hence, people are entitled to their possessions. Finally, 4) if people have title to anything, then they will have it regardless of whether their natural endowments are arbitrary from a moral point of view. People have title to them and what comes from them. 'We have found no cogent argument,' Nozick concludes, 'that (helps to) establish that differences in possessions arising from differences in natural endowments should be eliminated or minimised' (p. 236). We see here that Nozick, like von Hayek before him, resists the temptation to attribute moral and justice value to the issues of the market process in order to remain focused, according to his historical perspective, on the justice and moral legitimacy of the process of resource allocation through the market mechanism.