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Liberalism has brought sharp reductions in both poverty and international inequality. The past half-century can be seen as a long exploration of the power of liberal trade to raise living standards, not only in the rich world but among the poor too. The story begins with the growth that took place in western Europe, North America, Australasia and Japan once the two great scourges of economic activity--war and trade restrictions--were removed after 1945. The rest of the world--communist, socialist, or just plain poor--also grew, but more slowly: at 2.2% a year on average, or a threefold rise in income per head. Thus the gap between "the West and the rest", as Angus Maddison, an economic historian, described it in an OECD report in 2002 from which these figures are taken, has been widening. Though it does little to promote democracy, China is proving a spur to economic liberalization in other developing countries: fear that its growth will steal their markets or investment is prompting others to copy its reforms and to adopt international trade rules by joining the World Trade Organization.

This article discusses how 2005 could be a significant year in the fight against poverty. We have the cash, we have the drugs, we have the science--but do we have the will? Do we have the will to make poverty history? That is quite a question: big, crucial and--so long as "we" is defined broadly--entirely valid. And it is a question to which--according to Bono, the rock star and modern-day prophet who posed it--the coming year will go a long way towards providing an answer. In 2005, poverty reduction is scheduled to dominate the global policymaking agenda as never before. First will come some visionary reports, led by Jeffrey Sachs's study for the United Nations (in January) and Tony Blair's Commission for Africa (probably in March). In July, if Mr Blair does not unexpectedly lose a British general election in the meantime, he will host a G8 summit of rich-country leaders which will focus on tackling poverty, especially in Africa. In September, the UN will hold a special General Assembly Summit to review progress towards the Millennium Development Goals agreed in 2000, which include a commitment to halve the proportion of the world's population living in poverty by 2015. For so much high-level attention to be paid to the needs of the poor is unambiguously welcome. So, too, is the spirit of optimism with which policymakers and campaigners view next year. Yet it does not take a cynic to wonder whether so much international summitry might, in the end, generate far more hot air than action. There is a genuine danger of this. So before giddy rhetoric gives way to disappointment, it is worth asking what battles, realistically, might be won in the war on poverty in 2005.

Comments on United States contributions to global economic development. Impact on the U.S. of an impoverished country collapsing; View that the U.S. should pledge assistance of at least 0.3 percent of its gross domestic product (GDP); How the U.S. compares to other countries in providing aid to poor countries; Guidelines suggested for U.S. investment in foreign policy.

A new report gives governments some facts to ponder about economic development. For a better understanding of the plight of the world's poor, the protestors against capitalism who descended on the World Trade Organisation's meeting in Cancún last month ought perhaps to have gone to Haiti instead. In Haiti, one of the world's poorest countries, prospective business people have to wait an average of 203 days for permission to start trading. Then they have to pay registration costs and satisfy minimum capital requirements of around four times the average Haitian's annual income. The juxtaposition of stifling bureaucracy and abject poverty is no coincidence, argues a new report, "Doing Business in 2004", by the World Bank. It offers one of the first consistent, rigorous portraits of the costs of business regulations in poor countries. These often concern macroeconomic questions such as monetary policy and fiscal discipline, and the means of globalisation, such as free trade and foreign investment. Countries such as Haiti which, through colonialism, inherited laws from the French legal system are especially prone to red tape.