Iraq punished for not having WMD's; Libya rewarded for having them
The World Socialist Web Site points out the numerous hypocrisies involved in comparing the U.S. and British treatments of Saddam Hussein and Moamar Khaddafi.

Here's a summary:

• It is widely accepted (I don't know if it's true) that Khaddafi has supported terrorist organizations targeting U.S. and British citizens. He has accepted responsibility (albeit under enormous pressure) for the explosion of Pan Am 103 in 1988. As I said, I don't know how much of this is really true, but it is the accepted position of the U.S. and British governments. The only supposed terror attack on the U.S. that has been linked to Saddam Hussein was an assasination attempt on former president Bush in Kuwait in 1993. Details on this are sketchy. (I'd also add that if any bad guy in history would ever have been justified in killing another bad guy for having screwed him over, Saddam killing Poppy would have been it. Poppy helped Saddam to get the conventional and unconventional weapons that he had, gave him the green light to invade Kuwait, and then destroyed his country when he ran that green light.)
• Libya has actual WMD's; Iraq hasn't had them since about 1995 or so, apparently.

Okay, we already know that Bush and Blair are hypocrites. But why are they being hypocritical with Khaddafi in such a different way than they were with Saddam? The WSWS suggests:

• It's about oil. U.S. and British oil companies are ready to go flying back into Libya.
• It's about weapons. U.K. and U.S. weapons manufacturers are preparing to re-arm Khaddafi with multi-billion dollar deals.
• Most importantly, it's a cynical political ploy to show that the "lesson" of Iraq is working. Bush and Blair will continue to lie and pretend that the lesson is that if you support terrorism and have WMD's, you'll face the consequences. The airhead wingnuts in this country will buy that (they already have). But the lesson most of the world will get is that WMD's and terror are your only defenses against American imperialism: Saddam had neither, and look what happened to him.

WSWS concludes:

The diametrically opposed treatment of Iraq and Libya is not due to fundamental differences between the regimes of Saddam Hussein and Colonel Gadhaffi. Notwithstanding the invocations of humanitarian concern for the Iraqi people and other rhetoric associated with the so-called “war on terror,” Iraq was conquered so that the US could establish its hegemony over the oil-rich Middle East. Libya is now being courted out of the same essential considerations. London may have stolen a march on its European rivals, but the Bush administration will demand the lion’s share of Libyan oil contracts as payback for its billion-dollar [? Try hundreds of billions--Ed] investment in the Iraq war.