Fahad Bishara
Daily Trojan Online
October 27, 2003

Three weeks ago, I lent my friend Stan $20 with the unspoken understanding that it would be repaid within a reasonable timeframe. Since lending Stan the cash, he has succeeded in keeping quite the low profile. After a number of fruitless efforts to locate his whereabouts, I began to wonder whether or not I should continue – was the $20 even worth getting back at all?

Strangely enough, the situation seemed to fit quite well with what was going on in Madrid at the time. Over the past weekend, during which I wrestled with the question of letting Stan off the hook or not, a number of states gathered in Madrid to announce the magnitude of their financial support for the United States campaign in Iraq.

Although the Madrid conference was successful in raising a total of $33 billion ($20 billion of which has yet to be ratified by the Congress), it fell short in generating the $56 billion needed by Iraq for its reconstruction. Officials at the conference said that the shortfall was largely due to weaker pledges from nearby Gulf states than was initially expected.

Although many have speculated that the reluctance of the Gulf states to contribute larger sums of money is because doing so would imply a degree of acceptance of the U.S. occupation, those who observed the decision-making process on a state level saw that this was not the case at all; at the forefront of the debate about how much to give Iraq was the issue of Iraq’s regional debt, which is estimated at $120 billion even when one does not count reparations for the 1990 invasion of Kuwait and the subsequent Gulf War.

For example, the Kuwaiti government, which has already provided $1 billion in aid since the beginning of the occupation, pledged an additional $500 million at the conference much to the chagrin of some of its National Assembly members, who argued that Iraq still owed a great deal of money, a debt that cannot be forgotten. The same stance was also taken by Saudi Arabia, France, Russia and Germany, all of whom have felt the burden of outstanding Iraqi debts.

The question, then, is essentially this: should the international community relieve Iraq’s former war debts or not?

On the one hand, one can make the solid argument that doing so would set a bad precedent and would consequently force a revision of policies regarding other debts.

To put the argument in the form of a question, why should we cancel Saddam’s debts and not those accumulated by former Congolese dictator Mobutu Sese Seko, to name just one notorious example? Those who argue along a similar vein will undoubtedly point to an endlessly long list of war reparations that have been and are still being paid as further proof that forgiving Iraq’s debt would be the wrong path to go down.

On the flip side, proponents of Iraqi debt relief argue that repayment of Iraq’s debt would imply an investigation into how much money was owed and for what purposes, an investigation that would entail countries like France being held accountable for selling warplanes and missiles and Russia for selling tanks, aircraft and helicopters.

They further argue that it would also entail the Gulf Arab states like Kuwait and Saudi Arabia admitting they loaned money to Iraq when it invaded Iran. Consequently, such debts would be declared “odious,” a legal term used to describe borrowing money by dictators against the interest of their own people. If held by this standard, the loans are then not considered valid and thus need not be repaid by the people whose interest the money was used against.

Aside from the implications of an investigation on Iraqi debt, one must consider the effects the debt will have on Iraq. One hundred twenty billion dollars is no small number by any means, and to start a country off on the path of democracy while forcing it to pull along a heavy debt cart will most certainly account for greater problems and civil unrest in the future. Although Iraq is an oil-wealthy country that is capable of handling such a debt, it is also being faced with a number of other issues, including rival political and demographic factions, insufficiencies in basic services, and the like – it can most certainly do without the added stress of extra debt. Put simply, the money is not worth the trouble the debt can cause.

As a child living in Kuwait during the first month of the Iraqi invasion, the images I remember the most clearly are not of bloodthirsty Iraqi soldiers hell-bent on a path of death and destruction. Although the aforementioned has its occasional flash, the most predominant memories are that of adolescents and senior citizens dressed in camouflage and toting AK-47’s, none of whom wanted to be there. When thinking of the former regime, I often recall these memories to remind me of a valuable lesson; sometimes people are forced to do things they don’t want to, and if they do, it is up to us to forgive and forget.

As for Stan: I still want my $20 back, you thieving jerk.