Try to explain social life as the pursuit of pleasure and the avoidance of pain. You will soon be saying that the hedonist begs the question, for even supposing that man does pursue these ends, the crucial problem of why he thinks one course rather than another likely to produce pleasure, is untouched.
I know what this is, because they tried to indoctrinate me with it. The pleasure pain calculus has several names, one of which is called the hedonistic calculus.(He references this later) As is noted, this comes from Jeremy Bentham.
So they constructed what they sincerely hoped was a simplified diagram, not so different in principle and in veracity from the parallelogram with legs and head in a child's drawing of a complicated cow. The scheme consisted of a capitalist who had diligently saved capital from his labor, an entrepreneur who conceived a socially useful demand and organized a factory, a collection of workmen who freely contracted, take it or leave it, for their labor, a landlord, and a group of consumers who bought in the cheapest market those goods which by the ready use of the pleasure-pain calculus they knew would give them the most pleasure. The model worked. The kind of people, which the model assumed, living in the sort of world the model assumed, invariably cooperated harmoniously in the books where the model was described.
He's clearly describing the calculus here. From page 187:
The socialist theory of human nature is, like the hedonistic calculus, an example of false determinism. Both assume that the unlearned dispositions fatally but intelligently produce a certain type of behavior. The socialist believes that the dispositions pursue the economic interest of a class; the hedonist believes that they pursue pleasure and avoid pain. Both theories rest on a naive view of instinct, a view, defined by James,(11) though radically qualified by him, as "the faculty of acting in such a way as to produce certain ends, without foresight of the ends and without previous education in the performance."
And there, he calls it by name. A Fabian, with knowledge of Utilitarian concepts. Having read other works from the Fabian Society, I'm not surprised.