Income inequality does often grow in developing nations. However, that's usually not because "the poor are getting poorer," but because either a) the poor are staying put while the rich get richer, or b) the poor are getting less poor, but they're not doing so as fast as the rich are getting richer. According to a report published in 2000 by the United Nations, the World Bank, the Organisation for Economic Co-operation and Development, the International Monetary Fund, et al., the number of people on the planet who live on less than a dollar a day dropped by 100 million between 1990 and 1998. The number remained astoundingly high—1.2 billion—but bear in mind that the drop came even as the population of poor nations grew by hundreds of millions.

Of course, growing income inequality within a nation—whether or not it is caused by the poor getting poorer—may cause social strains and be regrettable for various other reasons. Enlightened national governments may choose to reduce it by income redistribution or other means. Still, it is not necessarily a bad thing when income inequality is the price paid for a rising standard of living.

Moreover, to suggest—as many have—that globalization is particularly responsible for the growth in income inequality may be the opposite of the truth. Two years ago two World Bank economists, David Dollar and Aart Kraay, released a study that looked not just at the effects of economic growth, but specifically at the effects of globalization. Tracking nations with the most open, most globalized, economies over the last several decades, they found that, as national income grew, the fraction of the economic pie going to the bottom fifth of the income scale didn't shrink. The rising tide indeed seemed to lift all boats.