U.S. Considering 'Odious Debt' Doctrine for Iraq

Reuters ^ | 04-29-03

[Brian S]

I want me one of those "odious debt doctrines". I deem all my debts "ODIOUS"!!!

[goldstategop]

LOL!!! Does that mean my Visa card debt has automagickally vanished?? I want some, I want some!!! :)

[John H K]

One positive side effect of this doctrine would be that people would be less likely to loan money to odious militarized dictators in the future.

[DonQ]

Adopting this for Iraq means __(I can't think of a polite word) such countries as France, Germany, Russia, and others who didn't help us but turn out to be doing business with Saddam, out of many millions of dollars. Serves 'em right.

[consultant]

I was stuck with a bunch of credit card run up by my ex. Since I definately consider her a hostile regime, I should have been relieved of that odious debt.

[Yardstick]

Good ol' Reuters.

"...the idea to declare the hundreds of billions of dollars owed to foreign creditors as "odious debt" is being promoted by some conservatives in the Bush administration."

Can you imagine them ever writing:

"...the idea to declare the hundreds of billions of dollars owed to foreign creditors as "odious debt" is being promoted by some liberals in the DemocratX administration." ?

It just wouldn't happen.

[Mamzelle]

If a country lends money, in the hope of making money, to a tyrant--let them be bankrupted creditors. Hope Chiraq is having some sleepless nights over this suggestion. The people of Iraq did not borrow this money, Saddam did.

[Toddsterpatriot]

This is a bad idea. They should be allowed to collect these debts.

Whose signature was on the paperwork? Saddam's? They should be able to collect from him.

Wait. He's dead? Nevermind.

[dark_lord]

They should repudiate the debt and declare they won't pay. They can then sell oil and operate on a "cash and carry" basis. What is their downside -- that the French, Germans, and Russians won't do business with them? That the same won't buy their goods (eg. oil)? Yeah, right.

[El Gato]

"...the idea to declare the hundreds of billions of dollars owed to foreign creditors as "odious debt" is being promoted by some liberals in the DemocratX administration." ? It just wouldn't happen.

Of course not, in part because DemocratX would be wanting to forgive debt owed to the American Taxpayer, not debt owed by odious socialist dictators.

Just because a new government governs the same territory as an old one doesn't neccessarily mean it's the same entity. Russia kept lots of old commies in place, and not just the peon level ones either. Will Saddam's thugs be kept around in the new government? I don't think so. The new government is not merely a slightly modified continuation of the old one, but an entirely new entity. Why should it deprive it's people some more, to pay the costs of their own enslavement. Let the Arab fatcats pay the debt to nations and individuals outside the region, and forgive that owned to them. Repudiation of these debts could be looked on a form of declaring bankrupcy I suppose, but I prefer to look on it as I describe above.

In the case of debts run up by one's ex, one at least theoretically was a party to the actions that resulted in the debt, I don't see how debts for Saddams Palaces, his missles and his WMDs are the responsibility of the Iraqi people. The Russians/Soviets, the French and the Germans knew what sort of person they were advancing credit to, let them eat the debt, just a lenders have to eat bad loans here.

[Steven W.]

I think they should equally adopt an ODOROUS plan as well - that involving people tied so tightly to Saddam who literally, physically STINK, specifically the French (and they do stink!)

[Ernest_at_the_Beach]

One positive side effect of this doctrine would be that people would be less likely to loan money to odious militarized dictators in the future.

Would make the world a safer place.

We should make it part of the new doctrine:

Bush Doctrine Unfolds :

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See this also:

US draws sword of trade retribution

[Grampa Dave]

Knowing Reuters, we are probably getting about 1% of what is happening here.

The remaining 99% is typical Reuters BS!

[blanknoone]

I don't care what the Paris club says, nor about the "Odious" doctrine. I think the new Iraqi government should look at the debts, and what they were used for. If they feel it was legitimately used for a proper government function, they should honor it. If it wasn't (to include the arms used to repress them...ie Russia's tanks) then they should default on it. They don't need anyone's permission...just refuse to pay them back. Heck, the Russians defaulted on some of their debt fairly recently, and the Soviets defaulted on the Czarist debt.

[Thud]

If Reuters says we won't do it, we will.

[Stingray51]

Yes, the Russian example is misplaced. They did not repudiate their debt in 1991. Instead, they borrowed more and more Western money before devaluing and defaulting in 1998.

[Tamzee]

It seems just so wrong that a group of people that were literally held hostage should now be responsible for the debts of the dictator.

Those who commented above are absolutely right... Iraq claiming this as odious debt would make it more risky for greedy governments to support dictators in other countries.

[Frumious Bandersnatch]

Maybe bringing this up is a brilliant move on Bush's part to get the sanctions lifted off of Iraq.

[headsonpikes]

As you say, the new Iraqi government won't need anyone's permission to repudiate those odious debts.

Chiraq and his cronies can suckez la air!

[Cicero]

There are ways and ways of doing this. I agree that they should honor legitimate debts. And I agree that they should repudiate illegitimate debts.

When France and Russia sold them weapons in the past ten years, they violated the sanctions and international law. Illegal debt is clearly uninforceable.

As for the rest of the questionable, they can treat it case by case. They can simply neglect to repay it, and let the creditors go beg for it. They don't need trade with France or Russia.

Or they can strike deals--90% writedowns and the like, with countries that want to resume trade in the future.

They want to avoid a situation where nobody at all will lend them more money. I think that can be avoided without paying all of these debts in full.