December Meme – Day Eight

The Meme

Today’s prompt is from [personal profile] aoifes_isle: Obscure factoid that everyone should know.

I went with an obscure vocabulary word!

Obscure factoid that everyone should know.

Definition of FUNGIBLE

1: being of such a nature that one part or quantity may be replaced by another equal part or quantity in the satisfaction of an obligation (oil, wheat, and lumber are fungible commodities)

So, this word was a revelation to me, in the context of budget items are often fungible. Not personal budgets, as discussed yesterday, but, say, the budgets of major corporations, charities, governments.

If you give a college a grant of $1m only to repair roads, then they can shift every cent in their repair roads budget, up to $1m, to other categories. So you are, in effect, funding, say, the Making Centaur-People lab by your roads only donation.

If I win a $50,000 gift card only for groceries (they happen, really), then I have $50k I don’t have to spend on groceries. See? Fungible.

It’s a neat word, and a good one to apply when people are debating public budgets.

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0 thoughts on “December Meme – Day Eight

  1. I for one welcome our new road repair funded centaur overlords. Yeah, fungible is a fun/important word. It was how I also realized some years ago that it’s pointless to have a rule like, “Gas tax proceeds must be spent on road/auto related expenses/activities,” unless you make *every* part of the revenue stream non-fungible. (And good luck getting such a rule passed or making it work) And of course even if you didn’t previously have $50,000 of grocery expenses for the time said gift card would last, what’s to stop you from using it to buy say nice bottles of wine, selling those, and presto now you have fungible cash from what wasn’t intended to be a fungible source. (Well, okay, many gift cards I’ve seen say no alcohol or tobacco purchases, still the concept still applies.)

    • When I worked in Medicaid/Food stamps, when someone got a massive overpayment on their Food Stamps EBT card & magically spent it all, the caseworkers would say “someone’s opening a grocery store.” I thought they were kidding until I encountered it in person – fungible money out of unfungible funds.

    • unless you make *every* part of the revenue stream non-fungible It’d be utterly inflexible, which isn’t viable in the real world where unexpected things happen. See some of California’s budget problems, for an example. That said, saying “foo funds bar” could set a minimum level of funding for bar … assuming your projections are reasonably accurate. See the MBTA funding / falling sales taxes problem in Massachusetts for an example.

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