Income inequality is an acute issue in the US and other developed countries, and as a result, many would consider government redistribution. In response, theories of entitlement, equality, and distribution have developed, including Nozick’s Chamberlin example of entitlement, Rawls’ theory of justice, and Marx’s theory of exploitation. The approaches can be used in the case where Tony, a hereditary restaurant owner, decides to deduct Renata’s salary, who has been an employee for six years during an economic downturn. Utilizing Nozick’s, Rawl’s, and Marx’s theories, Renata’s new wage is unfair, and Tony is wrong, suggesting that whatever they agree to is just since she is free to accept or reject the offer.
Analyzing the given case utilizing Nozick’s Chamberlin example, Renata’s new wage is fair. Describing his theory of entitlement, Chamberlin gave an example, assuming he is a cherished basketball player with many teams competing for his services. He then offers his services to one team on the condition that every spectator would contribute 25 cents, and at the end of the season, he receives $250 000.
The distribution is just despite Chamberlain having $250 000 more than other players. Tony is entitled to the net income from the previous year, but the economic downturn has affected distribution in society, consequently affecting Ton’s distribution. Nozick would argue that Tony’s agreement with Renata is just since it is based on free will. Notably, liberty in distribution is key to Nozick’s entitlement theory to ensure transfers are under free will. Renata willingly offers her services to Tony, considering there are many contenders for her job; hence she is better off in the distribution. Nozick would justify Renata’s new wage considering the economic downturn implicates holding distribution and transfer in the whole society.
In contrast, Rawls’s theory of justice would not validate Renata’s wage cut since it argues that individuals with similar natural abilities deserve equal opportunities and chances. The liberty principle holds that all individuals have equal fundamental liberties per the veil of ignorance. Being ignorant of an individual situation to objectively consider how societies operate to guarantee every party in a social contract enjoys the maximum liberty possible to prosper.
Rawls would argue that Tony denies Renata the freedom of job security and expression by issuing threats of firing her. Additionally, the difference principle of the veil of ignorance advocates that economic differences in a social contract should be mitigated by helping the disadvantages. Following Rawl’s theory, Tony should ignore his earnings and consider improving Renata’s earnings. As can be seen, according to Rawl’s approach, Renata’s new wage is unacceptable since Tony lacks a veil of ignorance to promote liberty and differences principles in their contract.
Moreover, Marx’s theory of exploitation highlights that labourers selling their services to the capitalist for less than the value of their labour in the commodities or services produced are exploited. Essentially, the compensated value should be proportional to the sold value of the work. Utilizing Marx’s theory in the case, Tony is exploiting Renata by reducing her wages despite her providing similar services. Moreover, Renata’s compensation is not based on Tony’s earnings but on the labor market conditions. Marx would respond by evaluating the value of Renata’s labor, then highlight the extent of exploitation Renata has been subjected to over the years.
Reflecting on my upbringing in middle-class circumstances where my family struggled with finances gives me a clear understanding of the situation. By far, Marx’s theory of exploitation is the most convincing analysis of Renata’s new employment terms. To the neutral observer, Marx’s theory is appealing since it analyses the uneven distribution of wealth and power in society resulting from under-compensation in capitalist societies.