Well what do libertarians say about distributive justice and the conflict between the material principles of fairness, especially merit and need. First, let me reinterate my usual disclaimer. There are many different forms of libertarianism that range from the far-right to the middle-left on the political spectrum. I can't cover that whole spectrum in a blog. But I can sketch in one basic line of argument.
In general most libertarians view "Fairness" in the context of the rules that govern competition; call it procedural justice. Competition is fair if and only if everyone plays by the same rules. For example, the game of baseball is "fair" to the extent that the rules apply equally to everyone that plays the game: "Three strikes, you're out!." Now, suppose the number of strikes afforded each player varied based on need. "Ron White is coming up to bat for the Cincinnati Reds. He's 60 years old, near-sighted, cross-eyed, has a stigmatism, and poor hand-eye coordination. So out of fairness, the umpire decided that Ron "needs" 11 strikes." Now would that be fair? Well, Joey Votto might argue that it's unfair to him because he was only afforded 3 strikes. On the other hand, Ron might argue that Joey comes to bat armed with a set of "natural advantages" that he doesn't deserve; natural attributes like: youth, uncanny vision, extraordinary hand-eye coordination, and the ability to concentrate on hitting the ball with runners on base. He also comes to the plate with years of practice and experience. Call it merit. While Joey was practicing hitting, Ron was reading and teaching philosophy. So if Ron and Joey were afforded three strikes each, regardless of their natural and acquired abilities, Joey would win the batting title and Ron would win the strikeout title. However, if Ron were given 11 strikes and Joey 3, Ron would argue that it's only fair based on need.
Now here's the problem. Why would Ron choose to compete in a game where the existing rules are stacked against him? If he chose to give up his teaching job to tryout for the Cincinnati Reds, and didn't make the team whose fault is it? Ron might argue that the rules of baseball discriminate against the elderly and/or the visually impaired. Joey might argue that giving Ron 11 strikes discriminates against Joey. After all, it's not Joey's fault that he's younger than Ron, has better eyesight, and better hand-eye coordination. So how do we go about resolving this apparent conflict over fairness between merit (allowing Joey to benefit from unearned attributes) and need (allowing Ron to benefit from the lack of those attributes)?
There are many different ways to look at this. I would argue that the Cincinnati Reds are the property of the owners of the team. If they want to bench Joey and let Ron play first base and hit third, it's their team. But who would choose to watch a baseball game where incompetent hitters are given 11 strikes? (The game is already slow enough!) Even though Ron agreed to a salary of a mere $100,000 a year, the nature of the game would shift from exhibiting merit to exhibiting need. No one would come to the games and MLB would go bankrupt. So barring any court ordered affirmative action, Ron's dream of becoming a Cincinnati Red has been thwarted by the rules of the game, and Joey Votto is likely to earn millions of dollars. But now we have Ron, who gave up his teaching job to pursue a career in Major League Baseball, and is now unemployed. Should he be able to draw unemployment? He bought new glasses and still spends all day in the batting cages practicing his swing and contacting other teams for an opportunity to tryout. But they refuse to even let him tryout! Should Ron get himself a lawyer and sue MLB for discrimination based on merit? What do you think? Is baseball a micrcosm of life or is it something else? Are natural attributes distributed more or less equally, even though they are highly variable? Is it up to us to choose occuptions that match our natural attributes? If Ron gets his teaching job back, would it be fair to pay Ron less than Joey? After all, the only basis for his merit is his ability to hit a ball, but he can only do it 33% of the time?