You’ve probably heard Barack Obama talk about the Iraqi government’s $79 billion surplus. Now Ashwin Madia is decrying the surplus in his latest commercial. On its face it’s a compelling argument: Why are we spending $10 billion a month in a country with a $79 billion budget surplus?

If you scratch at it a little bit, however, it’s more than a little misleading. And scratch at it is exactly what Iraq’s finance minister did at the Council on Foreign Relations this week. Here is the Iraqi response to this favorite Democratic talking point…

Speaking with the Council on Foreign Relations, Iraqi Finance Minister Bayan Jabr Solagh said August reports of a budget surplus of as much as $79 billion through 2008 fail to take into account the true nature of the Iraqi financial system.

“The surplus or the excess in money that people talk about is money that was not spent (in August),” he said. “We are spending it now through the budget process.”

The minister said the budget surplus is at the Iraqi Central Bank and not the development fund for reconstruction in New York. Solagh said the Central Bank deposits, which total no more than $30 billion, are used to back the Iraqi currency.

“It is not surplus; it is the federal reserve,” he said. “It is the reserve of Iraq. That means we cannot have a fixed currency without it.”

It’s the foreign policy equivalent of the “welfare mother” argument of days past. Iraq is a country suffering from endemic poverty, epic violence, and a public health crisis. If the Democrats want the high ground on Iraq, they ought to start climbing.