At long last we are starting to be honest about the national indebtedness issues we face:

The true scale of Britain’s national indebtedness was laid bare by the Office for National Statistics yesterday: almost £4 trillion, or £4,000bn, about four times higher than previously acknowledged.

It quantifies the burden that will be placed on future generations, and it is the ONS’s first attempt to draw together the "off-balance-sheet" liabilities that have been accumulated by the state. The figures imply a huge "intergenerational transfer" – broadly in favour of today’s "baby boomer" generation at the expense of younger people and future generations.

The debt primarily consists of the cost of public sector and state pensions, and of payments promised to private contractors under private finance initiatives. It far exceeds any of the figures so far published for the national debt, the largest current estimate for which is £903bn. That is projected to rise to £1.3trn by 2015…

It’s impossible for us mere taxpayers to put our heads round what that means, although the Indy tries:

Failure to cut back now or raise taxes – and there is little sign of the population clamouring to make life easier for the as-yet-unborn – will leave future taxpayers with an additional burden of £200,000 each over their lifetimes to pay for the public services enjoyed by this and previous generations.

Even with current plans to reduce the deficit, the tax bill would still be as high as £150,000 over the life of someone born in 2011.

Hmm. A bit more than £2000 per year over a lifetime suddenly starts to seem not quite so bad? These figures are enormous. But the national wealth generated by millions of people working away over generations is even more enormous.

One way or the other, the article brings out well the emerging question of ‘intergenerational justice’ – how far should we be borrowing from unborn people to pay for rubbish like climate change exhibitions at the UN?

And once we start thinking that government now should pay only for what people living now really can afford now, the size of government might well start to fall pretty fast as voters look hard at what they really want to pay for.

This also explains the nervous efforts made by collectivists to get away from the language of tax and debt.

It’s not debt. It’s investment, see?

Fine. Some of it is. A road built now benefits people well into the future.

But no business gets a blank cheque from the bank to make investments which have costs now and results later. Governments have to stop pretending that they are different.

As is deftly argued by Jonathan Davis who has the temerity to wonder whether Paul Krugman is talking tosh:

Not even to begin laying the ground for reductions in public spending today, let alone to confront the huge unfunded liabilities that lie beyond budget planning horizons, makes little sense. On past form it will take years for any cuts announced today to be fully implemented, if indeed they can be achieved at all.

Just as 364 economists turned out to be wrong when they denounced Sir Geoffrey Howe’s infamous 1981 UK budget, it is not axiomatic to me that Prof Krugman and co are right this time round…