We live in a highly unequal world and in strikingly unequal societies. The income discrepancies between the global poor and those in wealthy societies are enormous, with around one quarter of the world’s population living on less than $1 US per day, and many suffering from acute malnourishment, disease and premature death. (For some further details see articles by Thomas Pogge here and here .) But even within the very wealthiest societies great wealth coexists with severe poverty. Moreover, this is not simply an inequality in outcomes. Whilst the United States, for example, likes to imagine itself as a land of opportunity, social mobility is extremely low and in recent years the benefits of economic growth have been ever more concentrated in the very richest sectors of the population. According to one study, only 1.3 per cent of children born to parents in the bottom 10 per cent of income earners end up in the top 10 per cent. By contrast, almost a quarter of children born into the top 10 per cent stay there, and almost half stay in the top 20 per cent. Children born into the richest tenth of households are 18 times more likely than children born into the poorest tenth to end up in the top tenth. (Further see the Economist and Samuel Bowles and Herbert Gintis .)
David Schmidtz’s recent piece for Cato Unbound, When Inequality Matters is an artful and unnerving attempt to make use of some recent work within egalitarian political philosophy to argue against what we what we think of as the core of egalitarianism: the demands for greater equality of condition and opportunity. We are not convinced. In our view Schmidtz’s case neglects the impact that relative inequalities have on absolute levels of flourishing and depends at crucial points on dubious analogies and on muddying important distinctions. But it would be churlish not to acknowledge that he gets some things right. For instance, he is correct to emphasize that we must identify the dimensions in which equality matters, for the basic reason that making people equal on one dimension will often have the simple effect of making them unequal on another. Equalizing incomes, for example, would leave people unequal in well-being, because different people have different capacities to convert their income into well-being.
After a promising start, though, Schmidtz’s arguments go quickly downhill. An example is his talk of people’s worth, which is rather confusing and seems to run together two different ideas. The first of these is that of the fundamental equal moral worth of persons, an idea to which liberals are undoubtedly committed by their rejection of notions of natural aristocracy and hierarchy. The second is that of the value that people realize in their lives and through their actions and choices. It is better to keep these ideas distinct. Fundamental equality plays a vital role undergirding all modern political theories. The second idea of value plays very little role in plausible defenses of free markets, actual capitalist institutions, or egalitarian redistribution. It is tempting to want to retain some sort of reference to the value people achieve in their lives if you want desert to play a strong role in a theory of justice. But, as Hayek pointed out, outcomes of market processes are orthogonal to real moral merit. We are skeptical about whether the pattern of rewards that characterizes modern capitalist societies bears more than a distant and incidental relation to any distribution of worth or worthiness (though no doubt the successful like to tell themselves otherwise, for familiar psychological reasons). It is hard to believe, for example, that the class of people netting over $10 million per annum in the US today are much more worthy in moral terms than the class of people netting $50,000 a year, still less that they are 200 times more worthy. According to Ian Dew-Becker and Robert Gordon of Northwestern University the wage and salary income of Americans at the 90th percentile of the income distribution increased by only about 1 percent per year between 1972 and 2001 whilst over the same period that at the 99th percentile rose by 87 per cent and at the 99.99th by 497 percent.  No-one could seriously maintain that such changed tracked the relative moral worth of these groups over the period concerned. Similarly, while egalitarians seek redistribution which influences the pattern of opportunities to achieve worthwhile and valuable lives, they do not typically think that all will do equally well with those opportunities.
Schmidtz makes some polemical use of recent critiques of redistributivist egalitarian liberalism by Elizabeth Anderson and Iris Marion Young. Anderson, as Schmidtz notes, is concerned that recent trends in egalitarian liberal thought, and notably so-called “luck egalitarianism” have tended to foster a demeaning and condescending pity towards the poor. We admire Anderson’s endeavour to sketch a vision of a just society which focuses on the quality of relations among political equals rather that simply on their distributive share and agree that compromises among important values may be needed to secure such a society.
We are skeptical, though, that even in such a society the thought that it is bad that some people do badly through no fault of their own and have a claim to the assistance of others would have no place. The claim that luck egalitarianism fosters certain attitudes “in practice” is, in any case, a difficult one to evaluate. If existing schemes of redistribution (including health care and education systems) do foster condescending attitudes then that is undoubtedly a reason to change the way they operate. Few, if any, such actual schemes are, however, attempts to implement a luck egalitarian ideal. Again, we would simply dispute the idea that the mere thought that persons should not suffer through ill-fortune is demeaning or condescending to those who are its victims.
At its foundation Schmidtz’s agreement with Anderson appears to be the correct thought that society is not a “race” but, in Rawls’s phrase, a “cooperative venture for mutual advantage”. Most egalitarians agree (although most also think that something is owed as a matter of justice to those who are unable to contribute, perhaps because they are severely impaired, or because the contingent institutions do not have a place for their talents). But within this cooperative venture for mutual advantage there are many different kinds of advantage to be found, and the competition for some of those advantages is, indeed, structured like a race. In the contemporary US the occupational structure is such that, on the whole, income, social status, autonomy, intrinsic interestingness, political influence, and even health insurance are packaged together. The pursuit of any one of these is connected to the pursuit of the others. Furthermore, certain attributes give one a tremendous leg up in this “race”. Certain talents, certain personal traits, and certain parental traits play an enormous role in influencing who will do better in these competitions.
Much work has been done, some of it controversial, that suggests that low relative position is associated with low absolute levels of well-being. Schmidtz bombards us with statistics to show that the poorest in the United States have experienced real improvements in their life-expectancy and health outcomes over the past century. Such improvements are welcome, but Schmidtz’s use of these figures smacks of parochialism and complacency. Amartya Sen is just one writer who points to the fact that the life expectancy of poor black Americans (especially men) lags behind that of people in other societies that are more egalitarian at lower absolute levels of wealth and income. Michael Marmot suggests systematic correlations between inequality and health outcomes that depend not of weath and income as such, but on relative position.
Schmidtz concedes this race-like feature of social institutions when he follows up the comment that society is not a race that measures relative performance by writing of games and winners and losers and that “the key to long-run welfare never has been and never will be a matter of making sure the game’s best players lose.” If society is enough like a game to sustain Schmidtz’s analogy then we should probably insist on the being fair starting positions!
Schmidtz is keen to emphasise the instrumental benefits to all of competition and the division of labour. We have two points to make here. First, if efficiency considerations are as important as Schmidtz maintains then it cannot make sense artificially to exclude from the talent pool many individuals who might have developed their talent to the benefit of all, if only they had the chance to do so. A society in which the rich but stupid can get to Yale and end up in high and lucrative positions in commerce or government but where the natively smart but poor are deprived of the resources necessary to develop their talent is not one that effectively matches talent to social welfare.
Second, the leap straight from the benefits of the division of labour to the justification of income inequality is too quick. Market signals are no doubt essential to the efficient allocation of resources, including labour. But the allocative function of markets and their distributive effects are logically distinct, and market societies differ widely in their levels of income inequality. Where such inequalities are necessary to sustain the well being of all (and especially of those with the worst prospects) then we would follow Schmidtz in endorsing them as a matter of practical policy. But these are nevertheless inequalities that we regret and would want to reduce if we could find ways of doing so that were not counterproductive.
More importantly for practical purposes, we disagree with Schmidtz about the baseline against which inequalities must be justified. He seems to think that someone on the low end of an inequality has no complaint as long as the prevailing arrangements leave him better of than he would have been absent social cooperation. This may, ultimately, explain a great deal of our disagreement. But, with Rawls, we set the bar higher. Even if social cooperation makes someone much better off than he would be absent cooperation, he might have a complaint if he is much worse off than anyone would be under some alternative institutional arrangement. This is not the place to defend this disagreement in full. But consider for a moment the high earner who is faced with the observation that under a different scheme he would still be a relatively high earner, though absolutely a much less high earner, and is then asked what justifies the current arrangements. He needs to be able to say something like “because under these arrangements, everybody (or everybody who is worthy, or responsible, or something like that) does better than under the alternative arrangement in which I do worse.” If he cannot, and falls back on his own self interest, he is not offering a justification which has any force for anyone else. He is, then, in a very weak position to lecture egalitarians about the contempt they supposedly express toward the disadvantaged when they demand redistribution in their favour.
In his final section, Schmidtz addresses the question of redistribution and says that the scope of legitimate redistribution is limited by prior considerations of right and entitlement. We would not dispute this at a certain level of generality, but Schmidtz’s presentation—complete with homely examples of lost wallets etc—is apt to mislead. The “lost wallet” example eviscerates the distinction between what we should do within the rules of the existing game (or institutions of social cooperation) and how we should set up the rules themselves. It is true that much of the wealth the people have acquired under the existing rules of the game, is wealth that they have thereby gained a legitimate expectation to. As Schmidtz says “we do not start from scratch”. If we are going to approach matters in such a spirit of historical realism it would at least be seemly to acknowledge that part of the the historical explanation for the patterns of wealth and deprivation that exist within and between nations includes monstrous acts of injustice by any lights. Slavery, colonialism, imperialism, genocide are part of the picture as well as the worthy accumulation of property by diligent individuals according to existing rules. Most successful white American men in their sixties today owe some of their success and not a little of the wealth to the fact that uncontroversially unjust discrimination and blacks gave them an unjust advantage in the competition for places at elite colleges, entry level positions in their professions, and commercial contracts.
The rules, moreoever, are not simply a given. They are human artefacts that we can tweak and adjust so as to achieve more or less egalitarian outcomes. In this light the Nozickian contrast between historical entitlement and patterned conceptions of justice that Schmidtz relies upon is highly misleading. All such theories, including Nozick’s include both patterned and historical entitlement elements. Nozick’s patterning comes in his equal assignment of rights of self-ownership, Rawls’s ideas of the basic structure and pure procedural justice provide grounds for claims of historical entitlement. The thought that egalitarians must be purely outcome-oriented and their opponents purely historical is seriously muddled.
We agree with Schmidtz that in principle a considerable amount of material inequality and inequality of opportunity can be justified, because we believe that other values (like, for example, the value of family life) are so important as to prohibit the only ways of redistributing income wealth and opportunities effectively. We also believe that inequality is justified when it benefits those who have the worst prospects. But these considerations go very little way to justifying the inequalities that prevail in contemporary America or Britain (our own home countries). There is no comfort for those who would like to think that their own privileged position is beyond reproach from the perspective of justice.
fn.1 See Thomas Pogge, World Poverty and Human Rights, Polity Press 2002.
fn.2 See Harry Brighouse, “Birth of Educational Equality in the US”, Times Educational Supplement, 20 May 2005.
fn.3 Cited by Paul Krugman, “Graduates Versus Oligarchs”, NY Times, 27 February 2006.