Generation screwed?

I gave a short talk for a new student group last week, Generation Screwed. The event was joint with Students for Liberty, who seem to be setting up in NZ!

They'd asked about debt, tax burden, and intergenerational issues. I put together a few starter-notes to let them know where I was coming from; I've copied those below. 

1. The cleanest measure of the tax burden is government spending. Governments will try to hide the burden by shuffling it off to future through debt. Always watch spending rather than just taxes. The only real tax cut is a spending cut. The Public Finance Act tries to constrain govt use of debt, but it doesn’t enforce itself.
2. As a rule of thumb, governments should not spend more than they earn in tax revenue. Fine to take on debt in a crisis or downturn and pay it back on the upswing. But funding normal expenditure through debt is a terrible idea. It only works until it doesn’t. And when it doesn’t, things can get very bad indeed.
3. Debt for long-term infrastructure, funded by payments from the use of that infrastructure, is of a different category entirely – so long as the accounting is sound. What’s a good way to make sure the accounting is sound? Ban bailouts of that debt from government’s main balance sheet. Interest rates on it will be higher because they reflect real commercial risk. If a project is then not viable, it was a bad project to begin with.
4. Getting that kind of ring-fenced debt in order is vitally important in bringing housing costs down. Why? It lets the beneficiaries of the infrastructure needed to support new housing pay for that infrastructure over a long period of time, rather than spreading its cost across the entire community over a shorter period of time. The current setup means every other ratepayer has incentive to restrict new infrastructure because they’re stuck paying for it. Going back to basic principles of beneficiary-pays means we’d get to have more nice things. The housing shortage is fundamentally a zoning issue, and it’s a zoning issue because councils experience housing growth as a cost to their balance sheet to be managed through zoning rather than a benefit to be sought through infrastructure provision. Fix that and most of the problem is solved.

Seems like a fun group. I had fun anyway!