A Theory of Justice

Rawls writes that the public sector has two aspects: ownership of the means of production and the distinction between socialism and a private-property economy, and “the proportion of total resources devoted to public goods” (235).

The existence of a strong and respected state is crucial in addressing this issue. Public goods also carry issues of externality: “[w]hen goods are public and indivisible, their production will cause benefits and losses to others which may not be taken into account by those who arrange for these goods or who decide to produce them” (237).

Private markets often do not account for public harms (environmental, etc.), causing commodities produced to be sold at less than their social costs. Markets do not account for the divergence between private and social accounting, and therefore the law and government must institute the necessary corrections: “[M]arket institutions are common to both private-property and socialist regimes” (242).

The market system offers several advantages related to justice as fairness: efficiency, equal liberties, and fair equality of opportunity. The distinction between private-property and socialist regimes is that “prices under socialism do not correspond to income paid over to private individuals” (241). The income instead accrues to the state, which determines the distribution scheme.

The principles of justice are applied to create a basic structure, which will regulate society’s institutions and develop a social system to achieve distributive justice. To do this, the government is divided into four branches consisting of agencies to preserve social and economic conditions. The allocation and stabilization branches “maintain the efficiency of the market economy” (244).

The allocation branch maintains competition in the price system and prevents the formation of unreasonable market power. The stabilization branch establishes reasonably full employment, free choice of occupation, and strong demand.

The transfer branch sets the social minimum by accounting for and assigning appropriate weight to claims: “[O]nce a suitable minimum is provided by transfers, it may be perfectly fair that the rest of the total income be settled by the price system” (245).

The principles of justice dictate, then, that the total income of the least advantaged is enough to maximize their long-run expectations. The distribution branch imposes inheritance and gift taxes and limits bequests to correct the distribution of wealth in accordance with the principles of equal political liberty and fair equality of opportunity. Justice as fairness dictates that “inheritance is permissible provided that the resulting inequalities are to the advantage of the least fortunate and compatible with liberty and fair equality of opportunity” (245). The distribution branch also levies taxes “to raise the revenues that justice requires” (246). Resources are required for a government to provide public goods and satisfy the difference principle through transfer payments.

A fifth branch may be established and referred to as the exchange branch. Operating by the principle of efficiency, the exchange branch institutes a trading body to arrange for public goods and services when the market fails. The exchange branch is very hypothetical and would be difficult to construct.

The difference principle can be adapted to dictate it apply to the least advantage in each generation and, in this way, extend over time. The social minimum must be set at a point that maximizes the expectations of the least advantaged group. This can be achieved between generations through a system of taxation. As the portion of income subject to taxation increases, it eventually reaches a level where either appropriate savings cannot be contributed, or the taxes interfere with economic efficiency to the degree “that the prospects of the least advantaged in the present generation are no longer improved but begin to decline” (252).

At this point, the appropriate minimum has been reached and the difference principle has been satisfied. A just savings principle compels each generation to contribute to subsequent generations while allowing them to receive from their predecessors. However, because a later generation cannot improve conditions for the least fortunate of an earlier generation, something more than the difference principle is required to address the problem of saving.

Generations spread in both directions on a timeline, but “economic benefits flow only in one direction” (254). Justice depends on institutional treatment of these natural limitations and whether they are constructed to address historical possibilities: “Saving is demanded as a condition of bringing about the full realization of just institutions and the equal liberties” (257).

To reach a just saving principle, parties must represent family lines and construct a principle they wish all prior generations to have followed. Aided by the veil of ignorance and the principle of mutual disinterestedness, the parties must determine their desired level of savings with the assumption that all other generations have saved or will save in accordance with the same criterion. A savings principle borne of such considerations will be accepted by all generations.

The principles of justice disallow differing treatment of generations solely because of their placement in time. Because the veil of ignorance subjects the persons in the original position to the vantage of every period, they are assumed to have no time preference; consequently, the just savings principle is not affected by any time preference:

In the case of the individual, pure time preference is irrational: it means that [they are] not viewing all moments as equally parts of one life. In the case of society, pure time preference is unjust: it means that the living take advantage of their position in time to favor their own interests (260).

If the just savings principle is infringed upon, it must be because not infringing “would lead to an even greater injury to those on whom the injustice falls” (264). The priority of fair opportunity dictates that a wider range of more desirable alternatives be open to those with lesser opportunity than otherwise would be the case.

The final statement of the two principles of justice for institutions reads as follows:

FIRST PRINCIPLE: Each person is to have an equal right to the most extensive total system of equal basic liberties compatible with a similar system of liberty for all.

SECOND PRINCIPLE: Social and economic inequalities are to be arranged so that they are (a) to the greatest benefit of the least advantaged, consistent with the just savings principle, and (b) attached to offices and positions open to all under conditions of fair equality of opportunity.

FIRST PRIORITY RULE (THE PRIORITY OF LIBERTY): The principles of justice are to be ranked in lexical order and therefore the basic liberties can be restricted only for the sake of liberty. There are two cases: (a) a less extensive liberty must strengthen the total system of liberties shared by all; (b) a less than equal liberty must be acceptable to those with the lesser liberty.

SECOND PRIORITY RULE (THE PRIORITY OF JUSTICE OVER EFFICIENCY AND WELFARE): The second principle of justice is lexically prior to the principle of efficiency and to that of maximizing the sum of advantages; and fair opportunity is prior to the difference principle. There are two cases: (a) an inequality of opportunity must enhance the opportunities of those with the lesser opportunity; (b) an excessive rate of saving must on balance mitigate the burden of those bearing this hardship (266).

The conception of distributive justice outlined in the preceding sections is to a large extent pure procedural justice. This system of pure procedural justice requires a just system of surrounding institutions. It must now be evaluated whether common sense precepts of justice are compatible with the two principles of justice. The many precepts are weighed by the whole system of justice. For example, the precept of need is satisfied by the transfer branch instead of the allocative branch, as would typically be assumed, because it involves reallocating goods: “To assess the justice of distributive shares, we must note the total working of the background arrangements, the proportion of income and wealth deriving from each branch” (271).

A just scheme satisfies a person’s legitimate expectations founded upon social institutions but bears no relation to their intrinsic worth. The concept of moral worth “cannot be introduced until after the principles of justice and of natural duty and obligation have been acknowledged” is therefore secondary to the concepts of right and justice and does not affect distributive shares (275): “[N]one of the precepts of justice aims at rewarding virtue” (274).

Many mixed conceptions of justice exist, which substitute “the standard of utility and other criteria for the second principle of justice” (277). “[A]ll the mixed conceptions accept the first principle” of justice as fairness (277). When reasoned from the perspective of the original position, however, it becomes clear every form of reasoning prefers the second principle of justice as fairness to the alternatives. Even if the persons believe they are choosing a mixed conception and define it as such, they are choosing the two principles of justice. Therefore, while initially appealing, the mixed conceptions have no place in this discussion.

The principle of perfection has two variants. In the first variant, the principle of perfection:

is the sole principle of a teleological theory directing society to arrange institutions and to define the duties and obligations of individuals so as to maximize the achievement of human excellence in art, science, and culture (285).

In the second variant, a principle of perfection is one standard of several balanced in an intuitionist theory.

The second variant of perfectionism is the only one with any merit. It is a counterargument to egalitarian ideals and dictates that distribution should be more equal if required for meeting the basic needs of the less favored, but “the greater happiness of the less fortunate does not in general justify curtailing the expenditures required to preserve cultural values” (286).

In justice as fairness, the human perfections are pursued only within the limits of the principle of free association. This view does not presuppose that different individuals’ ends have the same intrinsic value or that their activities and accomplishments are of equal excellence, or that persons’ being of equal value is necessary for equal liberty. Because individuals possess different excellences (and quantities of such), equal rights cannot be insured by perfectionism: “To find a firm basis for equal liberty, it seems that we must reject the traditional teleological principles, both perfectionist and utilitarian” (290).