He means diminishing _marginal_ utility. Extra income always gives increasing utility on an absolute basis. An extra dollar of income gives a dollar of utilit

He means diminishing _marginal_ utility. Extra income always gives increasing utility on an absolute basis. An extra dollar of income gives a dollar of utility to everyone, but an extra dollar to Bill Gates gives less marginal utility than it gives to me because it's a much smaller proportion of his net worth and therefore will make less difference to his life than it would to mine.