VoiceOfRa comments on Probabilities Small Enough To Ignore: An attack on Pascal's Mugging - Less Wrong Discussion
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Correct. That still doesn't solve the decision theory problem, it makes it worse. Since you have to take into account the possibility that anyone you meet might have the power to torture (or reward with utopia) 3^^^3 people.
It makes it worse or better, depending on whether you decide (1) that everyone has the power to do that with probability >~ 1/3^^^3 or (2) that no one has. I think #2 rather than #1 is correct.
Well, doing basic Bayes with a Kolmogorov priot gives you (1).