When the state borrows today to pay for its expenditures, resources are transferred from private hands to the state today. The burden of the loss of resources from taking them away from their efficient use in the hands of entrepreneurs and putting them into the hands of politicians and bureaucrats occurs now. When the debt is paid in the future by taxes, there is a transfer of wealth between private parties, from taxpayers to bondholders. Resources stay in private hands. Future generations do not pay for state borrowing, the present generation does.
