lizabeth Anderson's bold and fascinating article is centrally concerned to argue against "luck egalitarianism" in favor of "Democratic equality." Anderson tells us that luck egalitarians, such as Thomas Nagel, Richard Arneson, Ronald Dworkin, G. A. Cohen, Eric Rakowski, John Roemer, and Philippe Van Parijs, hold that "the fundamental aim of equality is to compensate people for undeserved bad luck--being born with poor native endowments, bad parents, and disagreeable personalities, suffering from accidents and illness, and so forth."  On this conception the state should serve as a great insurance company by taking from people to the extent that they have benefited by cosmic good luck and compensating agents to the extent that they have suffered cosmic bad luck.  Luck egalitarians differ in some important respects, such as whether the proper space of egalitarian concern is with equality of resources, equality of access to advantage, or equality of opportunity for welfare, and so on. Anderson is sensitive to these differences but maintains that her central criticisms against luck egalitarianism apply to all such variants.
Anderson's offers a wonderful array of kinds of cases in which she argues that luck egalitarians get the wrong answer, but in almost all of the cases the fundamental failure of luck egalitarianism turns out to be that its principles express a lack of respect for citizens. Most centrally, luck egalitarians' concern for those who suffer from cosmic bad luck, according to Anderson, amounts to pity. And "Pity is incompatible with respecting the dignity of others." 
Such an argument might lead one to start reaching for an Ayn Rand Reader for comparison, but this would be a mistake. Anderson distinguishes "compassion" from "pity." Compassion responds to the absolute level of misery of others rather than the relative level of misery. Further, "Compassion does not yield egalitarian principles of distribution: it aims to relieve suffering not to equalize it."  Anderson, unlike Rand, has no problem with compassion. Pity's thought is that some are "sadly inferior" to others. And to think that this, together with the envy of those who are sadly inferior towards the cosmicly blessed, is the ultimate basis of egalitarian redistribution is to stigmatize and insult the victims of cosmic bad luck. Further, the state's basing its redistribution on such criteria as a person's cosmicly unlucky stupidity, ugliness, and uselessness leads to offensively elevating private judgments of inferiority to "the status of officially recognized truth." 
Briefly I will mention three further general complaints against luck egalitarianism. First, according to Anderson it is a "starting gate" theory in which so long as when one enters adulthood one's prospects have a certain character the state's obligations to one are fully discharged. Thus if one should fall on hard times as the result of imprudent or prudent but unlucky plans and become homeless and destitute the state ought not offer a hand. Anderson claims that luck egalitarians can avoid this result only by invoking offensive paternalistic constraints on our choices. Secondly, Anderson claims that because luck egalitarians typically inappropriately give weight to an agent's subjective concerns, they run into familiar problems with expensive tastes and allowing "private satisfactions to count as making up for publicly imposed disadvantages."  Thirdly, some luck egalitarians treat moral or quasi-moral concern for others as on a par with private matters of personal concern. They do so to avoid forcing the group to subsidize my (perhaps wacky) sense of moral obligation. But Anderson rightly complains that to treat all moral or quasi-moral concern, even one's own favored ethical theory, as just expressing a personal preference is to promise "equality only to those who tend only to their own self-interest." 
Democratic equality of the form favored by Anderson does not concern itself with rectifying cosmic luck but instead takes the object of justice to be to create social institutions which allow each the permanent capacity to live as equal citizens. Equal standing as a citizen requires that one can gain access to one's place of employment and have the resources one needs to be able to avoid selling one's body, but it does not require that one have equal access to dates or prestigious jobs. The capacities needed for equal standing are to be available such that even the imprudent are owed medical care and wheelchairs after their hang-gliding accident over the shark-infested cove. Further these capacities are to be available permanently so that one cannot trade away one's right to access to health care or a wheelchair should one want something else more. Such an arrangement avoids the charge of paternalism by "considering the point of view of the obligation holder"  who has an obligation to each which is "not conditional upon anyone's desires or preferences, not even the individual's own desires."  Anderson's case against luck egalitarianism raises profound and troubling concerns about such views and her system of democratic equality is genuinely compelling. I will, however, mention some concerns I have about her view.
First, consider the person who takes crazy risks with her life, loses her legs, and needs a wheelchair to enjoy the capacity to move about which Anderson recognizes as important to living as an equal citizen. Suppose then that the agent is given access to a wheelchair but after a few days sells it on the black market and squanders the money on alcohol. Similar things might be done with prosthetics, medications, and a host of material resources that in some cases are needed to provide a person with what Anderson thinks we are permanently owed the capacity to enjoy. I take it that Anderson would have to claim that after such items are sold the agent might well no longer enjoy the relevant capacities and so again be owed what they just sold.
Some might claim that such agents were given the relevant capacity and blew it such that the state has no further obligations to them. But Anderson, I take it, disagrees, for she holds that the state must guarantee "effective access to the social conditions of freedom to all citizens regardless of how imprudently they conduct their lives."  Further, such a societal guarantee, recall, must not be provided once and for all as with starting gate theories, but must be forever owed to whoever lacks such capacities at any time and for any reason (excepting crime). Part of Anderson's rationale for this is to avoid the state making intrusive and disrespectful judgments of individual's responsibility for their diminished capacities. But it is hard to believe that Anderson does not want to give priority access to scarce organs to the cosmically unlucky over those who were already given a healthy liver, either by birth or by societal provision, and who consistently drank grain alcohol in excess knowing the risks. If so, and if the state rather than the market is to allocate such resources, then the failure of the state to make judgments of individual's responsibility would seem disrespectful to the unlucky.
Anderson might well point out that because wheelchairs, prosthetics, medicines and the like will be offered free at least to those in our democratic egalitarian society that lack the capacity to pay for them, that a domestic black market in such goods is unlikely. But if any such things are needed outside our society or if such things have alternative uses which the state will not subsidize, then it would seem hard to prevent the conversion of such resources into money. My hunch is that in the end, if such conversion cannot be stopped, practical considerations will force the state to cease supplying needed resources to those that insist on converting such resources into money.
So far I have assumed that democratic equality would provide needed resources in the manner of food stamps or wheelchairs which are not themselves easily fungible. But there is room to wonder. Anderson's case against paternalism and state intrusiveness, together with her view that what we owe to each other is the provision of relevant capacities rather than functionings, seems to point to state provision of such capacities in the form of cash rather than food stamps and wheelchairs. Obviously if this is the case the problems mentioned above are severely exacerbated. But it is hard to see how to avoid this problem without reintroducing the policies of state mistrust, disrespect, and paternalism for its citizens that Anderson had hoped to avoid. And here focusing on those that owe the duties rather than those that are owed will not help alleviate the charge of paternalism, it seems, as what is owed is the provision of certain capacities which are equally well provided by money as by less fungible resources.
Second, Anderson claims that many groups that are seemingly the victims of bad cosmic luck do not seek the sort of rectification that luck egalitarians offer. She offers the deaf as a group that do not think of themselves as victims of cosmic bad luck and thus do not seek compensation for their bad luck. Rather they just ask to have access to means of communication that allow them to participate in civil society. Anderson makes much of the fact that actual oppressed groups typically do not press the sorts of demands that luck egalitarians press on their behalf but rather tend to press claims of the sort that democratic egalitarianism would champion. It is hard to know what force this, if true, could have in bolstering Anderson's case since she denies that the fact that a person wants or claims a right to X by itself makes any claim on the group and instead proposes "objective standards of injustice and remedy...." 
Finally, one could wonder if pity, in Anderson's sense, is really "incompatible with respecting the dignity of others"  Recall that pity is concerned only with the relative rather than the absolute standing of others. But democratic equality demands for its citizens what is needed here to have equal standing, to be able to be seen without shame, and the like. Thus here access to regular showers, frequent changes of clothes, and the like might well be needed for equal standing. Elsewhere access to such goods might be restricted to the rich, and not simply because other societies value cleanliness less than we do. Thus it would seem that democratic equality concerns itself with relative rather than absolute assessments of an agent's capacities. It requires that agents not fall so far below their fellows in certain needed capacities that they can no longer interact as equals. But this is concern not for an agent's absolute level of capacities but for how the agent fares with respect to her neighbors. Isn't this what Anderson elsewhere calls disrespectful pity?
Sometimes it seems we can judge a person cosmically unlucky such that, by local standards, they are deemed less fortunate without being deemed "sadly inferior". Indeed, part of what is being said, it would seem, in claiming that this was cosmic bad luck, rather than a deserved fate, is that "there but for the grace of God go I." The person who decides that they got a philosophy job over others at least equally industrious and talented might feel cosmically blessed and allow that his fellow applicants were cosmically unlucky, but such a judgment surely does not involve judging that the other applicants are sadly inferior in a manner that is "incompatible with respecting the dignity of others." Generally, in a wide array of cases we can judge a person cosmically unlucky, even to the point of deserving compensation, while having no tendency to think that this reflects badly on her or diminishes her status as our equal.