This New Year, like the last, will find many people struggling with the tight-fisted consequences of a lingering recession. Perhaps the best New Year’s wish that could be offered is an old Irish toast that goes: “In the New Year, may your right hand always be stretched out in friendship, never in want.” Unfortunately, as we begin this New Year there are millions who must stretch out their hand in want. “In November, 300 million more people around the world were suddenly poor – on paper, at least,” reports Jina Moore [“Why 300 million more people are suddenly poor,” Christian Science Monitor, 17 November 2010]. She explains:

“The Multidimensional Poverty Index (MPI) raises the number of poor by 21 percent, to more than 1.7 billion. According to the MPI, sub-Saharan Africa is still home to the greatest proportion of the world’s poor, but more than half of the total number of poor lives in South Asia. These numbers, and the new index that produced them, are part of the UN’s annual Human Development Index (HDI), a statistical touchstone. It covers everything from the number of women who die in childbirth to how many people have Internet access and can sway decisions on US policy, influence where nonprofits spend money, and help determine where donors give. For years, the HDI has set the standard for just how little a person has to live on to be considered poor. The answer? $1.25. But some researchers have long said income alone doesn’t define poverty. ‘There are some things money can’t buy,’ says Sabina Alkire, cocreator of the index and director of the Oxford Poverty and Human Development Initiative, which launched the index in collaboration with the UN. ‘It might not buy electricity; it might not buy a public health system, or an education system.’ Ms. Alkire’s index looks at poverty more experientially. It uses existing survey data and categorizes households as poor if they lack three or more of the 10 poverty indicators, which are spread across health, education, and basic standards of living.”

Although I encourage you to donate to causes that help the poor, I agree with William Easterly, a professor of economics at New York University and co-director of its Development Research Institute, that development, not dole, is the best solution to the challenges faced by those trapped in poverty [“Only trade-fuelled growth can help the world’s poor,” Financial Times, 21 September 2010]. Easterly writes: “Current experience and history both speak loudly that the only real engine of growth out of poverty is private business. … Trade-fuelled growth not only decreases poverty, but also indirectly helps all the other [millennium development goals].” To read more about the millennium development goals, read my post entitled Two Views of the Millennium Development Goals. In that post, I quoted New York Times‘ columnist Nicholas Kristof, who wrote, “The best way to overcome poverty isn’t charity but economic growth, trade rather than aid.” I also quoted the Wall Street Journal‘s Rupa Subramanya Dehejia, who wrote, “The only sure way of pulling people out of poverty and at the same time making progress on the other goals is employment-intensive development.”

Easterly believes that the developed world has squandered “opportunities to allow poor countries’ efficient private businesspeople to lift themselves out of poverty.” Each New Year brings with it the possibility that past mistakes will be corrected and a better course followed in the future. As the American celebrity and activist Oprah Winfrey once said: “Cheers to a new year and another chance for us to get it right.” Let’s hope this New Year puts us on a course that corrects past mistakes, that sees us make better choices, and that raises more people rise out of poverty than sink into it. On a more personal level, it is my wish that this New Year brings you good health and happiness.