THE URBAN INSTITUTE Are Justice and Inequality Compatible? Isabel V. Sawhill and Daniel P. McMurrer mericans are deeply attached to the among young children, from experiments with ideal of equality of opportunity and adult subjects, and from anthropology sug- have made important, if halting, gests that notions of fairness are deeply progress toward achieving that ideal (see brief embedded in human nature. Individuals who no. 1.) Yet the distribution of income remains are otherwise self-regarding and rational will Amore unequal than in other advanced coun- sacrifice their own well-being if it produces tries and more unequal than 25 years ago.1 what seems to them a fairer distribution of Liberals believe that this level of some valued good. Specifically, given a inequality is incompatible with choice between more money for one- economic justice but never Given self and very little for another ver- define the benchmark a choice between sus a smaller sum more equally against which progress distributed, individuals regu- should be measured. more money for oneself and larly choose the latter even Conservatives argue very little for another versus a when there are no long-last- that inequality reflects smaller sum more equally distrib- ing ties between the two differences in individ- parties.3 ual talent and effort, uted, individuals regularly choose It would be naive to and as such is a spur to the latter even when there are suggest that people are economic growth as entirely altruistic. Those who well as the price we pay no long-lasting ties between are fortunate enough to be in for living in a free society. the two parties. the top part of the distribution In the words of George Will, would like to think they have there is “no prima facie case against “earned” the right to be there, and that the moral acceptability of increasingly large society is better off for their striving. Mixed in 2 disparities of wealth.” Yet, even conservatives with our philanthropic urges is a certain have largely accepted a certain amount of amount of rationalization of position.4 redistribution. To quote Will again, large dis- To suggest that fairness is either deeply parities do “not mean that social justice must embedded in human nature or a rationaliza- be defined as whatever distribution of wealth tion after the fact does not mean there are no the market produces.” principles or reasoned arguments that can be brought to bear on the topic. In this second Can Social Justice Be brief we review some of them as a precursor Defined? to examining the data on opportunity in brief no. 3 and brief no. 4. How, then, is social justice to be defined? Would we want to live in a society in which Three Basic Questions OPPORTUNITY IN AMERICA OPPORTUNITY IN AMERICA incomes were, literally, equal? And, if not, Tackling the issue of distributive justice what’s the right amount of inequality, and do requires grappling with three basic questions. we have too little or too much at present? First, what do we want to redistribute: What As James Q. Wilson notes, evidence kind of prizes are we talking about? Second, A series on drawn from close observation of interactions what’s the right amount of inequality: How economic and social mobility No. 2, October 1996 big should the prizes be? Third, how asking A why he is entitled to manna output increase? By more than $1.00 8 open is the process by which individ- that Q also wants.” The very phras- is the answer. With a growth dividend uals compete for these prizes? ing of the question suggests that the of this size, richer Paul would be able burden of proof should be on those to pay back poorer Peter for the initial The Problem of Value: What Is the who advocate inequality. transfer and still have something left Prize? John Rawls, whose answer to this to share between them. In thinking about distributive jus- question has probably been as influ- Put in less abstract terms, any tice, the natural tendency is to focus ential as any, reasons that the fairest proposal that reduces the taxes of the on income and wealth. Our own treat- distribution of valued goods is one affluent by curbing the incomes of the ment of the topic will follow a similar that individuals would freely choose, poor must more than pay for itself (in bias. Nonetheless, other outcomes or or agree to, had they no knowledge of terms of increased growth) if it is to “goods”—political rights, individual their own ultimate position in society.9 meet the Rawlsian test of fairness. liberties, economic efficiency, and These include race, sex, social class, Few economists—much less liberal happiness—also matter.5 even innate talents and psychological philosophers—believe that such gains Most of the arguments that propensities. Under such conditions, are feasible in contemporary society. plague discussions of social justice he postulates that they would only Equally few believe the converse, that ultimately revolve around the weight- agree to those inequalities that bene- redistributing more income to the ing of these different values. There is fited everyone, but especially the poor would make them absolutely no way, for example, to achieve the least advantaged. These can be pre- worse off. There may be leaks in the kind of egalitarian society that some sumed to be those inequalities required bucket but at the end of the process it liberals advocate without intervening is not entirely empty. in family life to the point of threaten- Rawlsian conceptions of fairness ing the rights of parents to have and If we faced the possibility that can be criticized on several grounds. raise children as they see fit. This we might end up at the bot- First, it is not at all clear that most threatens the very integrity of the people are as risk adverse as Rawls 6 tom of society, we might want 10 family as an institution. assumes. Second, the process of Another conflict is the well- to ensure that it was not such redistributing income from the more known trade-off between equity and a terrible place to be. to the less fortunate requires interfer- efficiency (or between fairness and ing with the basic liberties of those growth). Redistributing income from who—for reasons of history, individ- wealthy person A to deprived person to sustain sufficient effort or call forth ual effort, or inheritance—happen to B may reduce the total size of the pie, sufficient talent in the production of begin with certain advantages. As because of its effects on the incen- social goods to enable the least Robert Nozick notes, one cannot sim- tives to work of both A and B. Arthur advantaged to improve their lot. ply look at “time-slice principles as Okun called this the leak in the bucket The logic of giving special atten- constituting the whole story about used to transfer resources from one set tion to the least advantaged appears to distributive shares.” One must also of individuals to another. According derive from a desire to protect against look at the process that created the OPPORTUNITY IN AMERICAto the best estimates of economists, the worst No. 2 outcome we can imagine for distribution and assess the fairness of transferring a dollar from the rich to ourselves. In other words, if we faced the process itself. It can be argued the poor can cost society as much as the possibility that we might end up at that, as long as the process is fair, 50 cents in lost total income.7 The the bottom of society, we might want everyone should be permitted to keep 11 conflict between aggregate efficiency to ensure that it was not such a terri- whatever they have earned. and an equitable distribution of ble place to be. The assumption is that income is very real. We may have to most of us are a bit risk adverse and The Fairness of the Process: Who sacrifice some of society’s total income would want to avoid a very bad out- Gets the Prizes? to achieve a little more equity or vice come—even if that meant making do In a feudal society, whether one versa. That such a trade-off exists may with a lot less should we be fortunate is a noble or a serf is ascribed at birth. be less surprising than the unwilling- enough to end up near the top. In the American creed, in contrast, ness of Americans to accept an The implications of insisting that anyone can become president of increase in the trade-off commensu- the disadvantaged as well as the Microsoft. rate with the increase in our affluence. advantaged gain from any distribution Virtually all Americans endorse that favors the latter are profound. To this vision of an open society, and for The Degree of Inequality: How Big see this, imagine a two-person society many, a belief in its existence is what Are the Prizes? inhabited by Peter and Paul, who start has made them tolerant of unequal Bruce Ackerman asks us to with equal incomes. Now transfer a results. What has been left out of the imagine a world in which there is dollar of income from Peter to Paul American conversation about oppor- only one resource, manna. “When all and assume that this encourages both tunity are the facts about how much manna claims are added up, they to work harder, thereby increasing opportunity there really is. exceed the available supply. Hence, total productivity by enough to leave There are countless articles on the question of legitimacy arises, Q both better off.