"When a despotic regime contracts a debt, not for the needs or in the interests of the state, but rather to strengthen itself, to suppress a popular insurrection, etc, this debt is odious for the people of the entire state. This debt does not bind the nation; it is a debt of the regime, a personal debt contracted by the ruler, and consequently it falls with the demise of the regime. The reason why these odious debts cannot attach to the territory of the state is that they do not fulfil one of the conditions determining the lawfulness of State debts, namely that State debts must be incurred, and the
proceeds used, for the needs and in the interests of the state. Odious debts, contracted and utilised, for purposes which, to the lenders' knowledge, are contrary to the needs and the interests of the nation, are not binding on the nation – when it succeeds in overthrowing the government that contracted them –unless the debt is within the limits of real advantages that these debts might have afforded. The lenders have committed a hostile act against the people, they cannot expect a nation, which has freed itself of a despotic regime, to assume these odious debts, which are the personal debts of the ruler."
My nephews (11, 10 and 8) set me to thinking about this when I explained that they would be the ones paying for current federal spending. They blithely declared that they weren’t going to pay it, that they didn’t authorize it, and that those who spent the money should pay it. In sum, they intend to repudiate the national debt. Maybe they will get the chance to act on their instincts someday.
The only hitch in declaring Bush debts Odious is the point about “lender’s knowledge”. Savings Bond buyers and individual investors are not necessarily aware of the odiousness of the debt. Certainly, the Social Security “trust fund” managers are aware. Surely, the other nations who hold US debt are aware.