On the first, global free market capitalism was, is, and always will be the best long-term solution to get the developing world out of poverty. Period.
Isn't the developing world still impoverished? You have some examples or at least a chain of logic for this, or is it just a matter of faith?
I don't necessarily disagree with your claim, and I'm a person who says, "hey, 40 hours/week in a factory should enable you to house, feed, and educate your family, and if you can do that on pennies a day in a third world, that's a fair wage", but I do wonder about the role of capitalism in impoverishing the developing world in the first place.
A theory-based approach would be that Ricardian Comparative Advantage states that each import-export makes both sides better off. This means that more trade in the developing world would make the people there strictly better off. Also, I would argue that colonialism, not capitalism, impoverished the developing world. Companies, often wholly owned or very closely linked with imperial governments, were granted monopolies in the colonies. That's not free market capitalism.
For more quantitative evidence:
NYTimes:
Since the mid-1970's, Japan, Korea, Taiwan, China and their neighbors have lifted 300 million people out of poverty, chiefly through trade.
Institute of International Economics:
The elimination of tariffs and other protective barriers globally would:
* lift at least 500 million people out of poverty over 15 years;
* create long-term economic benefits to developing countries of $200 billion per year; and
* enable industrial countries to convey about twice as much gain to developing countries as they currently provide through foreign aid—at a benefit rather than cost to their own consumers.
So, yes. The developing world is still impoverished, but millions of people risen out of that poverty because of trade. And ironically, the political route many countries took, communism/socialism, to end what was impoverishing their countries, imperialism, was the worst possible choice they could have made from an economic sense.
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The argument that free trade -- or at any rate, the semi-free trade that has existed in actuality -- impoverished the third world is longer term; centuries-long deindustrialization, etc. The version I would say is most compelling is that most trade is partly free and partly managed, where different polities interfere in the market to maximize their share of profit gain; that political intervention in the markets can allow both parties to profit even a little, but produce wildly differing long-term economic results; that a variety of political interventions in the marketplace are therefore justified -- indeed, necessary, since everybody else engages in them. Obviously this chain of logic can also lead to counterproductive interventions in the market, but I do find it somewhat more compelling than free-market absolutism. So while I'm generally a free-trader, I think there have been effective protectionist policies (US, 19th century?), and will be in the present and future.
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