Utilitarianism

Utilitarianism is an ethical standard that says: the right action is the one that maximizes the aggregate well-being of society. Under utilitarianism, all lives are considered equal.

To make utilitarianism easy to understand, think about how you would feel if you found $20 on the ground. If your income is low, that $20 could buy you a lot of utility. If you’re Bill Gates, it’s literally not worth the second of your time to pick up that $20, since he makes about $130 per second anyway. While Bill Gates might still feel that the $20 bill is thrilling to find, it’s not going to add much marginal utility to his life. He’s got so much money that $20 is nothing to him utility-wise.

It’s easy to see how utilitarianism comes up in discussions of redistribution programs. It’s the basic tenant behind progressive taxation: taxing wealthier folk at a higher tax rate than poorer folk. Progressive taxation is the rule rather than the exception. You’ll only find a flat personal income tax in a few places, like Russia, Madagascar, and the Seychelles.

To illustrate, 20% of a poor man’s wage being eaten away by taxes might affect his ability to pay rent, feed himself, get to work...the basics. To contrast, 20% of a rich man’s wage being eaten away by taxes won’t affect his living basics. Maybe just his investments, toys, or whatever else he would’ve done with that money.

While many politicians and people may not claim be to utilitarians, the basic pervasiveness of progressive taxation show some basic accepted element of utilitarianism that affects us all. And yes, we totally get that not all people are born equally talented, equally driven, equally smart, equally socially advantaged, etc...so the whole notion that everyone should be treated equally (other than given equal opportunity) is a Thing here. The political rhetoric revolves around the notion of taking money from the high-earners and giving that money to the low earners with the presumption that the government does that efficiently. Ever been to a DMV? Yeah. You know what we're talkin' about.

While this is super basic utilitarianism, it’s important to remember that there are many types of utilitarianism. There are different ideas on how to measure utility, and practical applications of utilitarianism...things like ideal utilitarianism, act and rule utilitarianism, two-level utilitarianism, and preference utilitarianism. Ooof.

Not to fret—just remember: it’s all about maximizing utility (the happiness and well-being) of society with actions. And at what price.