After World War I, the victorious allies tried to collect $33 billion in reparations from defeated Germany. It was a disastrous policy - one that fueled German resentment, possibly contributing to the subsequent rise of Hitler.
Today, a beaten Iraq faces far greater debt problems - essentially a national bankruptcy on a scale with few parallels.
That's one reason why, despite their disagreement about the war itself, the seven largest industrial nations agreed this past weekend to push for debt forgiveness - even though some of them are owed substantial sums.
It was a start. But the negotiations won't be easy and could be take some time.
Iraq's international debts are the largest of any developing nation - by one economist's reckoning, $387 billion.
"It's a mountain of debt," says Alan Krueger, an economist at Princeton University. It would amount to $16,000 for every man, woman, and child in Iraq, many times per capita income.
Germany's World War I reparations totaled about twice its gross domestic product (GDP). The debts were never paid in full. They proved to be an impossible burden. Iraq's debts amount to 15 times its annual GDP of perhaps $25 billion.
Iraq does have economic strengths, notably huge oil and gas reserves. It also has a relatively educated populace and considerable land suitable for agriculture. With the dictatorship and its "command economy" ended, some expect the entrepreneurial talents of many Iraqis to bring a rapid revival. "Iraq has great potential as a country," says Jeffrey Frankel, a Harvard University economist.
Nonetheless, Iraq's debts will never be paid in total. "It's like a bankruptcy," says Frederick Barton, who with Bathsheba Crocker compiled an outline of Iraq's financial obligations for the Center for Strategic and International Studies in Washington. "Everybody [creditor] is going to have to swallow hard and move on."
He suspects the $387 billion in debt will have to be reduced to something like $25 billion, paid, perhaps, over 10 years. The maximum Iraq could pay in any one year would be "5 percent of GDP."
What concerns Mr. Barton and others is that the Iraqi debt issue may delay fully tackling Iraq's reconstruction. "Paying off all of Saddam's mistakes is not sensible," Barton says. "Our No. 1 priority should be Iraq's renewal. Or do we want to do this war again?"
Another problem is the structure of Iraq's obligations. They consist, according to the Barton-Crocker analysis, of $199 billion in unresolved claims for compensation from creditors in more than a dozen nations after the invasion of Kuwait, $127 billion of foreign debts, and $57.2 billion in pending foreign contracts - public and private. Iraq owes Russia $12 billion (much of it for arms), Kuwait $17 billion, the Gulf States $30 billion, and smaller sums to Turkey, Jordan, Morocco, Hungary, Bulgaria, Poland, and Egypt.
Pending contracts, which may or may not have lasting value, are mostly to Russian firms ($52 billion) but also involve France, China, the Netherlands, the United Arab Emirates, and Egypt. Iraq owes the US relatively little.
Paul Wolfowitz, US deputy defense secretary, has called on Germany, France, and Russia to write off their debts.
Responding to Mr. Wolfowitz, Russian President Vladimir Putin said Friday that Moscow would write off loans to Iraq valued at $8 billion to $12 billion. There have also been reports that the US will back at least some of Russia's claims.
Usually, foreign debts are restructured by private or sovereign creditors in negotiations in Paris or London. A UN Compensation Commission deals with the $320 billion in claims against Iraq related to its invasion of Kuwait. Individuals and families have received a total of $16 billion from Iraq's oil revenues, or an average of 30 cents on each dollar of resolved claims.
The US and its allies have located $3.6 billion of assets abroad controlled by Saddam Hussein's regime. These include bank accounts, real estate, and diamonds. They could, presumably, be used to finance humanitarian needs. It is doubtful if any will go toward paying creditors.
The search is also on for hidden accounts amassed by Mr. Hussein and his family - estimated at $6.6 billion by the US General Accounting Office.