Multiple senses of a word

Clear writing requires diligence in the use of the dictionary - especially when you are using a word that has multiple senses (meanings).

For example, on the economics blog Marginal Revolution, we see these sentences about the bailout of Federal National Mortgage Association and Federal Home Loan Mortgage Corp.:

“But let’s say that the Treasury did not support the debt of the mortgage agencies.… Most of the U.S. banking system would be insolvent. (Boldface added.)

In one sense of the word insolvent, “insufficient to pay all debts,” the U.S. banking system is already insolvent, and has been for almost a century. The banks deliberately hold only a small fraction of the reserves they would need if an unusually large number of depositors decided to close their accounts.

So the writer probably meant insolvent in the sense of “unable to pay debts as they fall due in the usual course of business.”

By not specifying which sense he was using, the writer showed his disrespect for his readers. He made them pause and guess. The better-educated among his readers will guess correctly; they know that writers who are unfamiliar with economics are usually unaware that insolvent can mean “insufficient to pay all debts.”

The writer not only irritated his readers but also cast doubt on his qualifications.

The Takeaway: As you write, always keep in mind that many words have more than one sense (meaning). Be careful when you use such words. If you are not certain that your readers will know which sense you are using, specify it.