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Fungibility

Caeli: Hi!
Elliot: Hi, Caeli.
Caeli: What does "fungible" mean?
Elliot: It means stuff that isn't unique so you can swap them and it doesn't matter. Like paperclips or staples. If I lend you paperclips, I won't care if I get exactly the same ones back. They are all the same. Compare that to a pet dog. Dogs are different and you wouldn't want to get a different dog back from your dog sitter.
Caeli: OK, that makes sense. What are some applications of the concept?
Elliot: Money is a big one. It's all the same. If you spend less on one thing, you can spend more on another, and vice versa. Whether you spend money that came from one source (like a paycheck) or another (like a gift) to buy something doesn't actually make a difference. You end up with the same amount in your bank account regardless.
Caeli: Don't people know that?
Elliot: No. People often have different policies for different sources of money. Paychecks go primarily to bills, expenses and savings. And people are usually fairly stingy with them. But other sources of money are often seen as "extra" and treated differently. Like gifts, tips, or money found on the street. People often aren't as careful and frugal with "extra" money.
Caeli: I see. Is it important to avoid that?
Elliot: Yes. We should have a policy about how to spend our money which we consider best. Money is the same, so it should treat all our money the same way.
Caeli: Can't we afford to be more loose with money if we have more?
Elliot: That's true. So the policy can take that into account. It can say that rent is first priority, and then have something else to say about remaining money. But the divisions should be based on real things in your life, like the cost of rent, not on irrelevant things like how much of your money was a gift, how much interest on investments, and how much from paychecks.
Caeli: I see. That's a good idea. Do you think that the way people do it actually approximates the right policy decently? Perhaps the paycheck covers normal things about right so they know money after that really should have a new, looser policy.
Elliot: That may work out reasonably for some people, but they should think about whether it does. For some people that will work badly, and if they notice they can avoid that error.
Caeli: OK, good point. What else is important?
Elliot: The fungibility of money comes up frequently in politics. Suppose an organization, like Hezbollah, spends a certain amount of money on charity projects like building schools. And the rest on killing Jews. Then if you give them money for schools, the actual result will be funding murder, because money is fungible and they have an increased budget.
Caeli: Is it really a charity project if they build a school on top of a weapons depot?
Elliot: No. And besides that, they build schools for propaganda purposes. And so that they can indoctrinate kids using biased textbooks.
Caeli: What sort of lies do they put in their textbooks?
Elliot: False histories of Israel, maps that don't have Israel and say Isreal isn't a legitimate country, conspiracy theories. And it's not just lies. There's also extreme, undying, unthinking hatred and vilification which is too subjective to call a lie.
Caeli: A book like that might be amusing to read. And the weapons depots might be fun to visit. I like weapons. I could look at them and ask to shoot the guns.
Elliot: Yeah, even horrible books like that are no danger if no one is using force, you can stop reading whenever you want, and you are aware of rival views on the matter. This is all the more reason not to fear TVs. But back in real life, terrorists who fill textbooks with propaganda are not nice to their kids. They use them as human shields in their wars, and do their best to force them to be hate-filled and to believe lies.
Caeli: What are some more examples?
Elliot: People often say that if they cut money on one thing, like art, it will be available to spend on another, like English. This is sort of true. But if you cut money on anything it will be available to spend on anything else. It doesn't have to be art, and it doesn't have to be English, and the decisions for which two things shouldn't be related.
Caeli: So you're saying there is no reason to tie the idea of cutting art funding with the idea of increasing English funding. It could just as well be math funding that's increased, and which it is doesn't depend on any way in the qualities of art. Art money is fungible and works just as well to fund any other class.
Elliot: That's right. The same sort of thing comes up a lot with government programs and budgets. Going back to the charity issue, that is also common. For example suppose there is a homeless guy who wants to eat, and also wants luxuries. And suppose your city has a food voucher program, so you give him food vouchers. You may think this is great and he will have to spend your money on a meal, so you're helping him and not providing for his luxuries. But you're wrong. Every dollar of food you buy him is one less he has to buy himself, so after eating he will have more money left over to buy luxuries, thanks to you.
Caeli: That sucks. What can we do about it?
Elliot: Don't give money to people with values you consider bad. You will be supporting those bad values because money is fungible. Any promises to spend your money on things you approve of won't help, because that will just free up equal quantities of money for other purposes.
Caeli: Aren't there two exceptions? Let's get back to the homeless guy and the food vouchers. The first exception is if vouchers plus his own money don't combine to have leftovers after food purchases, then he won't be able to buy luxuries. Why don't you reply to that and then I'll say the other.
Elliot: That's true. But keep in mind that in that case you could have given him money and not food vouchers, and it would have made no difference. And keep in mind that if he eats well today he will be less hungry tomorrow and will have an easier time diverting funds to luxuries like alcohol and cigarettes.
Caeli: OK. The second exception is if the total amount of money required to be spent in certain ways is more than he would have spent in those ways anyway. If he has already eaten and gets another food voucher, it won't turn into booze.
Elliot: It won't. But it won't turn into food either: he's full. It will just be wasted.
Caeli: Are there any other important issues around fungibility?
Elliot: I can think of two. The first is that it's not rocket science, and it's important to a lot of major world events, like funding terrorism, so fungibility really ought to be well known. But for some reason it's not a large part of public debate. That's important.
Caeli: What's the second thing?
Elliot: Fungibility matters to certain physics and philosophy. For example there are moral philosophies, like utilitarianism, which treat people as fungible. They don't care who's who, they just care about the total happiness or whatever. All such moral philosophies are very bad. People aren't fungible.
Caeli: Not at all?
Elliot: Well, consider dogs. Pet dogs usually aren't fungible. But certain characteristic of dogs are, like being soft and hairy. Many dogs will fetch balls. And there are dogs with specific purposes that basically are fungible, like dogs that sniff for drugs. Any dog with sufficient training and a good enough nose will work.
Elliot: So, the fungibility of a dog depends what you care about. If you care about the nose, they are pretty fungible. If you care about whether it remembers you, they aren't fungible at all.
Elliot: Now let's look at people. If you care about people's ideas, and personality, and past history, they are not fungible. But in certain ways they are fungible, like if you need unskilled labor to build a pyramid.
Caeli: Moral philosophies need to care about people's ideas, so they shouldn't treat people as fungible.
Elliot: That's right. It matters differently if a good person is happy and if a bad person is happy, for example.
Elliot: Another issue is continuity of people, or indeed any objects. When is it the same object, and when is it not? This is related to fungibility which also has to do with what is the same or not.
Caeli: What's an example of a continuity issue?
Elliot: If you take a wooden boat, and you do repairs and renovations so many times that eventually every single scrap of wood has been replaced, and indeed every single atom of the original boat is long gone, then is is still the same boat?
Caeli: That's tricky.
Elliot: It's not so bad. Objects shouldn't be defined by their atoms. What matters is human explanations of what is what. And for general human purposes, that's the same boat. For a specific issue people are thinking of it might sometimes be useful to regard it as a different boat, but in general there is no reason that changes atoms should disrupt continuity.
Caeli: OK. You mentioned continuity of people.
Elliot: Yeah. Suppose you changed out all the neurons in someone's brain with metal ones. Is it still the same person? Is it now a computer?
Caeli: That's the same problem as with the boat.
Elliot: Correct. And it is still the same person. The worldview and ideas haven't changed. It's also a computer, but it was before as well. Just like being made of our organic material (in other words, mostly carbon) doesn't make your brain less of a computer, being made out of metal wouldn't make you less of a person.
Caeli: I'm going to go to sleep soon. Any last words?
Elliot: Some people try to analyze military conflicts by counting the dead bodies on each side. That's wrong. People aren't fungible, and you can't reach any reasonable conclusions about the morality of a war without thinking about why people died, in what circumstances. Counting is no good. It doesn't even work for pure military calculations: not everyone is an equally competent soldier.
Caeli: Makes sense. Bye.
Elliot: See you later.

Elliot Temple on October 22, 2006

Comments (1)

Other applications of the concept of fungible...

In the field of Particle Physics...
there exist Fermions, which are indistinguishable (fungible) atomic particles; examples are electrons and protons.

In the field of Business...
there exists two classes of inventory, serialized and nonserialized. A serialized item is distinguishable since we know its serial number because the serial number acts as the identifier. But with a nonserialized item, we can not identify it, hence it is indistinguishable (fungible).

Rami S Rustom at 8:43 PM on December 5, 2011 | #2139

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