1) Historically, debt bondage has led to debtors and their children being condemned to perpetual slavery to repay financial debts. Some ancient laws and traditions included provisions for debt forgiveness and freeing children from slavery due to parental debt. 2) The concept of intergenerational equity proposes that endowed institutions should spend investment gains equally between current and future beneficiaries, preserving resources for future generations. For example, unsustainable logging could deprive future generations of forest resources. 3) Debates around national debt and intergenerational equity consider whether current deficit spending and debt accumulation provides benefits to the present generation at the expense of increased costs and risks imposed on future generations through higher taxes or reduced government services.

1. History
Since the first recorded debt issuance in Sumaria in 1796 BC,[2]
one of the penalties for failure to
repay a loan has been debt bondage. In some instances, this repayment of financial debt with
labor included the debtor's children, essentially condemning the debtor family to perpetual
slavery. About one millennium after written debt contracts were created, the concept of debt
forgiveness appears in the Old Testament, called Jubilee (Leviticus 25), and in Greek law when
Solon introduces Seisachtheia. Both of these historical examples of debt forgiveness involved
freeing children from slavery caused by their parents debt.
While slavery is illegal in all countries today, North Korea has a policy called, "Three
Generations of Punishment"[3]
which has been documented by Shin Dong-hyuk and used as a
moral paragon of punishing children for parents mistakes. Stanley Druckenmiller and Geoffrey
Canada have applied this concept (calling it "Generational Theft"[4]
) to the large increase in
government debt being left by the Baby Boomers to their children.
Investment management
In the context of institutional investment management, intergenerational equity is the principle
that an endowed institution's spending rate must not exceed its after-inflation rate of compound
return, so that investment gains are spent equally on current and future constituents of the
endowed assets. This concept was originally set out in 1974 by economist James Tobin, who
wrote that, "The trustees of endowed institutions are the guardians of the future against the
claims of the present. Their task in managing the endowment is to preserve equity among
generations."[5]
in terms of an economical context. Intergenerational equity refers to relationship
that a particular family has on resources. An example is the forest-dwelling civilians in Papua
New Guinea, who for generations have lived in a certain part of the forest and thus becomes their
land. The adult population sell the trees for palm oil to make money. If they do so at an
unsustainable level there will be no resources for their children or grandchildren in the future.
The unsustainable use of resources would then lead to Intergenerational inequity.
U.S. national debt
See also: National debt of the United States
One debate about the national debt relates to intergenerational equity. For example, if one
generation is receiving the benefit of government programs or employment enabled by deficit
spending and debt accumulation, to what extent does the resulting higher debt impose risks and
costs on future generations? There are several factors to consider:
 For every dollar of debt held by the public, there is a government obligation (generally
marketable Treasury securities) counted as an asset by investors. Future generations benefit to
the extent these assets are passed on to them, which by definition must correspond to the level
of debt passed on.[6]
 As of 2010, approximately 72% of the financial assets were held by the wealthiest 5% of the
population.[7]
This presents a wealth and income distribution question, as only a fraction of the

2. people in future generations will receive principal or interest from investments related to the
debt incurred today.
 To the extent the U.S. debt is owed to foreign investors (approximately half the "debt held by
the public" during 2012), principal and interest are not directly received by U.S. heirs.[8]
 Higher debt levels imply higher interest payments, which create costs for future taxpayers (e.g.,
higher taxes, lower government benefits, higher inflation, or increased risk of fiscal crisis).[9]
 To the extent the borrowed funds are invested today to improve the long-term productivity of
the economy and its workers, such as via useful infrastructure projects, future generations may
benefit.[10]
 For every dollar of intragovernmental debt, there is an obligation to specific program recipients,
generally non-marketable securities such as those held in the Social Security Trust Fund.
Adjustments that reduce future deficits in these programs may also apply costs to future
generations, via higher taxes or lower program spending.
Economist Paul Krugman wrote in March 2013 that by neglecting public investment and failing
to create jobs, we are doing far more harm to future generations than merely passing along debt:
"Fiscal policy is, indeed, a moral issue, and we should be ashamed of what we’re doing to the
next generation’s economic prospects. But our sin involves investing too little, not borrowing too
much." Young workers face high unemployment and studies have shown their income may lag
throughout their careers as a result. Teacher jobs have been cut, which could affect the quality of
education and competitiveness of younger Americans.[11]
Australian politician Christine Milne made similar statements in the lead up to the 2014 Carbon
Price Repeal Bill, naming the Liberal National Party (elected to parliament in 2013) and
inherently its ministers, as intergenerational thieves; her statement was based on the party's
attempts to roll back progressive carbon tax policy and the impact this would have on the
intergenerational equity of future generations.