Increasing the wealth of the world by an amount equal to the U.S.

I recently calculated that the 122 nations ranked by Fraser Index averaged a rate of growth of 1.7% from 2000-2005.  The twenty nations that had the highest gains in economic freedom from 1995-2005 averaged a rate of growth of 4.2%.  If the entire global economy had grown at a rate of 4.2% instead of 1.7% between 2000 and 2005, the world would have an extra $10 trillion in wealth, equal to more than five times the annual income of Africa and almost equal to the $13 trillion U.S. annual economy.

The nations with the top ten gains in economic freedom averaged growth rates of 6.1%.  At this rate of economic growth, by 2006 the world would have had nearly $20 trillion in additional wealth.

Those nations with the largest gains in economic freedom are likely to experience faster rates of economic growth, and the poor will usually benefit.  For example India, the 19th largest gainer in economic freedoms 1995-2005, experienced an average rate of growth of 5.38% in 2000 - 2005.  The McKinsey Quarterly reports that in 1985 93% of the Indian population lived on less than a dollar per day.  By 2005 that had been almost cut in half, down to 54% of the population.  They estimate that 431 million Indians were brought out of severe poverty by means of the economic growth that took place from 1985-2005.  They estimate that if India could achieve an average annual growth rate of 7.1% for the next 20 years, another 465 million would be brought out of extreme poverty.  There are no charities that can bring so many people out of poverty so quickly. 

Each year, tens of millions of Indians are buying their first wristwatch, transistor radio, blender, or bicycle, and feeling a sense of gratitude and satisfaction from these modest gains that most of us will never know.  Read Gurcharan Das' India Unbound for a beautiful description of this transition from an Indian who loves the spiritual India but also knows that her people need material goods to thrive.