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Lots of people have thought that utilitarianism has problems allowing for strong individual rights. The whole point of having rights is that they cannot be violated simply because the violation produces a gain in overall utility. It doesn't matter whether you think of utility as happiness or welfare or satisfied preferences. I think this criticism is correct.

But I want to point out a different problem with utilitarianism that I think has considerable force.

We can construct any number of thought experiments in which the sacrifice or torture of one individual increases the welfare of the majority. (Read Ursula Le Guin's short story "The Ones Who Walk Away from Omelas.") Utilitarianism seems to allow this. Can we accept that view as morally correct? The same sort of thing could be said about sacrificing one group for another, larger group. Stalin saw himself as sacrificing a generation of Soviet citizens in order to hasten the economic development of the Soviet Union. If Soviet economic development had been highly successful, would he have been morally right to do what he did?

The problem is that utilitarianism tries to maximize an aggregate of something. The distribution of that thing doesn't matter. For utilitarianism, people are simply 'containers' that hold some amount of happiness or satisfaction. It's only the total amount of happiness that matters.

I think this is the sort of thing that Rawls had in mind when he said that utilitarianism doesn't take seriously the distinction between individuals. He was right. The 'containers' don't matter, and the distribution of happiness doesn't matter. How do we know that the set of rules that would maximize happiness or welfare doesn't include rules that allow the extreme exploitation of a small minority of the population? I don't think we do.