I agree that fungibility is a hugely under-appreciated (or cynically de-emphasized) concept when it comes to funding governments via special taxes. (Great exam

I agree that fungibility is a hugely under-appreciated (or cynically de-emphasized) concept when it comes to funding governments via special taxes. (Great example.) The concept also applies to non-profit donations more broadly, but only under the assumption that the size of the donation is small enough that it doesn't exceed the total amount that the non-profit would have spent on that cause anyway. If you're donating a large amount that exceeds the current budget for your chosen cause, then your donation does make a difference -- but it's not quite as large as it seems. It might only be the difference between the previous spending level and the new level (after your donation and after some budget refactoring). To use your example, if the state was spending $1B on on schools previously, then donating less than $1B doesn't necessarily make a difference to school funding -- they can just push money around. But if you donate $1.2B, then you have made a difference -- of $0.2B. If you're donating to a small non-profit, though, then maybe it's easier to find targets in which you could dwarf the existing spending on your topic of choice. (Not to say that you should, though. I agree with Graham's argument.)