Borrowed time

Me and my kids' dad bought our first home in 2003, in Dunedin.

The property market was batshit, or so we thought.  Bless.

Each Saturday, at open homes, we'd see the same demoralised young couples, in a similar position to us.  We were all priced out of the ideal we'd grown up with: three bedrooms and a quarter acre section.  So we made bleak jokes, poked at rotten weatherboards in undesirable suburbs, while we waited for a perspiring real estate agent called Rex to show us through.

Eventually we bought our place, 90 square metres on the side of a hill. We compromised on our dream (ouch) with two bedrooms instead of three. 

This wasn't the first home our parents might have bought.  Some things change with time: privilege and inequality are two of them.  But it was more than my kids can imagine they'll buy in their 20s or 30s.  And it had the things every young family needs: wallpaper to scribble on, enough space outside for a crappy trampoline, and a friendly cat lady across the road.

To buy that place - awful bathroom, state house cupboards, persistent mould patch on the ceiling - we took out a mortgage for 25 years.  And I can't remember anyone saying, you're crazy.  That's a debt that will span a generation.

Probably, they saw our purchase as a sensible thing to do, the right thing in that time and place.  A way to secure our own financial futures, and those of our kids.  They were happy for us.

Borrowing is a complex business.  I'm not an economist, wouldn't pretend to know the ins and outs.  But I've never figured out the kiwi-style panic about our national debt.  Sure, governments of every stripe buy stupid things, and borrow to pay for them - I can't condone it.  And yes, enough debt will land a country in the poo.  But by any measure I've seen, New Zealand's debt just isn't that bad.

Still, the fear of debt haunts our collective nightmares, like Margaret Thatcher in a négligée.

There are commentators - some of them economists, many politicians, most old guys called Rex on Facebook - concerned that taking on debt is destroying our way of life.  Whether it's borrowing to keep a COVID-impacted economy afloat, or to fix our crumbling infrastructure, some are convinced the sky is falling on our heads.  And they fall over themselves to blame Stalinda/Taxcinda/Insert your shit misogynist pun here.

Here's my two cents, and I welcome yours.

First, if we don't borrow, we pay the cost right now, during a pandemic.  Instead of national debt, people, families and businesses must themselves borrow or go bust, carrying in private the cost of a public crisis.  If you think that's a good idea, fine - but feel free to point to the businesses you'd prefer to go under.  And the adults you'd like to see laid off; the kids you're keen to watch going hungry.  

Second, the damage we inflict today lasts into the future.  Those businesses that go under don't grow, hire more more people.  The adults who are laid off don't get to buy houses or save for their retirements.  The kids who miss out the basics of childhood - not trampolines and cat lady neighbours, but food and education and basic security - never recoup what they've lost.

I reckon we stop comparing ourselves to a past that's no longer, or fretting about a theoretical future we don't really plan to take responsibility for.  Let's take up the generational challenges that face us today, and do what is needed right now.    

We can borrow money or we can borrow time - drawing down our kids' future to enjoy an easy, delusional present.

Because there's no free ride here.  The question is only how the passengers share the fare.