What to do about Iraq's debts? Senator John McCain has a brilliant suggestion, one the administration should push around the world for all it's worth.

If that fails, however, they can always rely on a U.S. legal precedent... and a French legal concept. Political Science Professor Barry Cooper of the University of Calgary writes:

"But there is plenty of debt left – some $95 billion or so according to a recent study by the Centre for Strategic and International Studies. Additional relief might come from repudiation, as was done after the regime change in Cuba following the Spanish-American war. The US declared that neither the new Cuban government nor the US would be responsible for the debt incurred without the consent of the Cubans and without regard for their benefit by Cuba’s deposed colonial rulers.

After World War I a French international lawyer, Alexandre N. Sack, formalized the American procedure with the concept of "odious debt," debt incurred by tyrants on their own account that was not transferred to a successor government. What makes this dusty French concept to delightfully applicable to the current situation is that a large chunk of the Iraqi debt is owed to odious French banks."

UPDATE: There's a serious discussion of "odious debt" going on in the comments section of this post at Jane Galt's site. (Hat Tip: Erik of Bite the Wax Tadpole)

Some upsides and downsides to invoking it, but one upside is that other odious dictators like Mugabe would suddenly find themselves considered to be a huge lending risk. Plus, there's the endless humour value of watching the Left suddenly come out against their pet concept of Third World debt repudiation.

For a very good article about Iraq's economic future, I found this Wharton background piece via the Agonist.