Money is a good thing. We all are individually better off when trade is eased, even if it also causes inequality. I approve of money as a concept, despite its long-term drawbacks upon society. Somehow I have a modicum of faith that those issues will eventually be addressed. We're going to figure out how to make the extreme inequalities go away, sooner or later.
But it is another deceptively application of money that gives me pause. It is something so fundamental to the idea of money that I'm not sure how it could be solved without also taking away trade altogether. This idea, considered an unrelenting positive by most, is fungibility.
When I give money to someone else, they can use that money for whatever they want. Money reserved for one purpose can easily be spent on another purpose, simply by virtue of every base unit of currency being the same as any other. If I give you $10 to purchase chips for the party, you can instead spend those individual bills on something else entirely, and then purchase chips using a completely different set of bills. When you donate to a charity, requesting that they money be spent on X, they can just take the money previously allocated to X and reduce it by whatever amount you donated, effectively making your donation pay for something other than X.
Several state in the United States of America have infamously done this with programs like lotteries or gambling establishments. Before a vote to legalize gambling, the promise is made that tax money from gambling will go toward funding schools. But schools are already funded before this vote; once money from gambling comes in, the legislature will reduce the amount that gets allocated to schools from other sources. This results in some states where the amount of money that schools get will actually decrease once they start getting funded by gambling taxes.
This isn't the fault of gambling, or of charities having restricted funding, even though both ideas are poor ones (I think). The fault is that money can be moved from area to area too easily. Sure, this is good for trade, and it makes it easier to plan ahead, and it has all kinds of benefits. But it also causes ethical issues. Often, I've stopped to give cash to someone on the street, and a traveling companion will say something against it, maintaining that the money would be spent on drugs. Don't get me wrong; there are good reasons to instead spend that money on truly poor people in developing countries, and there are solutions available, like giving away gift cards to local eating establishments. And there are good reasons for valuing individual choice, resulting in the idea that if they decide to spend the money on things that are 'bad' for them, it should be their choice to do so -- giving a gift card to a fast food restaurant instead would be like gifting calves in developing countries rather than the cash that is needed for them to replace their thatched roofs.
But it makes things feel weird to me. Boycotts, for example, occupy a strange place in my mind. On the one hand, if a soft drink company does something absolutely terrible, like fund death squads in Columbia, or if a pineapple company violently overthrows the government of Hawaii, we might want to stop (and get others to stop) buying from them, with the end goal being to get these (and other) companies to not do these sorts of things in the future. However, it becomes less clear to me when the problem is with the owner of a company, rather than the company itself. Is there a justification for a boycott there? Or is this unfairly punishing the company for something that the owner is doing that we do not like?
And here it becomes complicated. Because if I pay you to run an errand, and then you use those funds to pay a company which I was boycotting, does that mean I broke from boycotting?
I've been chided before for giving cash as a gift. "It's not memorable", they've said, and they're correct about that. But I always thought that the goal was to maximize the chances of getting something that the recipient would appreciate, and that seems to be maximally possible with cash (and/or btc). "At least buy a gift card", they would say, but that defeats the purpose. Yet, over time I have been worn down, and now I tend to purchase things that say something about the relationship between myself and that person, only supplementing these thoughtful gifts with cash on the side.
Recently I received cash for my birthday. I was told to spend it on something special. Instead, I spent it on repaying a debt. But I still purchased something special, with later funds that otherwise would have been spent on repaying that debt. So did I buy something special with my birthday money?
In The Good Place, characters are in the afterlife, discussing what kinds of purchases are good or bad. They point out that there are so many externalities with even the smallest purchases that any exchange of goods might indirectly be causing extreme suffering. They say "indirectly" here, and I think that's the word most people would use, but if we take fungibility seriously, then isn't it really just directly causing suffering rather than indirectly? An indirect chain implies that the decision on what the last link funds isn't the same as the decision on what the first link funds. Yet if money is truly fungible, then the last link is equivalent to the first link, and any decision made on the first directly carries over to what the last does. You might be ignorant of what your money is funding, but you are directly responsible for it, not indirectly responsible for it.
Of more relevance to me today, however, is my pledge to give between 25% and 33% of my income to effective causes for the rest of my life. I've kept to this pledge even when working directly at an effective charity. But when I work at a charity, I take an extreme pay cut. Should this count as part of my pledge? My last full-time non-charity job paid $105/hour. If I take a job with an effective altruism charity that only pays $52/hour, then am I effectively donating half of my income without even giving away any of my money directly?
I'm not sure how seriously I should take fungibility and fungibility-adjacent ideas when it comes to ethical decisions. I feel like this is something I just need to think about more. Michael Sandel had some interesting thoughts along these lines, though not specifically about what I've written here. And there are some classic texts from Mill and others who explore related ideas. Maybe I need to review the literature a little more to see what others have to say on these topics.