On February 3, 2025, exactly 20 years after former South African President Nelson Mandela stood in front of a cheering crowd in London’s Trafalgar Square to launch a historic global campaign to “make poverty history,” employees of the U.S. Agency for International Development (USAID) received an email telling them not to come to work. The United States’ main agency for fighting poverty around the world was, as the billionaire entrepreneur Elon Musk put it, being “fed into the woodchipper.” At the same time, the world’s other biggest donors, including France, Germany, and the United Kingdom, were making drastic cuts to their global health and development spending. Over the course of 2025, donors across the world slashed some $30 billion of foreign aid.

The short-term effect of this retreat has been catastrophic. The world’s deadliest infectious diseases—HIV, tuberculosis, and malaria—became even deadlier last year. Initial projections from the Institute for Health Metrics and Evaluation indicate that because of cuts to health assistance, as many as 200,000 more children died in 2025 than in 2024, mostly in Africa—marking the first year this century that the number of children dying around the world went up instead of down.

Even if some countries and institutions step up, aid will not fully recover. Projections indicate that through 2027, global health and development funding will remain nearly 30 percent lower than it was in 2024. It is likely to fall more sharply as the conflict in and around Iran drives up the cost of essential commodities and causes governments to divert even more resources to security and defense. Yet the world can still make progress with less money if global institutions narrow their objectives and invest in the capacity of poor countries to handle problems on their own. The long-term goal of the aid sector should be to make itself unnecessary in the future. Targeted investments in areas that contribute to local growth and human potential can push the world there within the next 20 years.

Over the past year, those who dismantled USAID have promoted a great myth: that aid has been ineffective and fundamentally wasteful. Musk, for example, called USAID a “ball of worms” operating on “stolen tax dollars.” This myth has already convinced some people that their generosity has no real effect in the world when in fact it has been transformative.

Global efforts to reduce extreme poverty this century have been remarkably successful. In 2000, 2.2 billion people across the globe lived on an income equivalent to $3 a day in today’s dollars. By 2015, that number had dropped to one billion; today, it’s 840,000. And this progress is not only the result of economic booms in China and India. Since 2000, countries as diverse as Bangladesh, Ethiopia, Indonesia, and Senegal have all cut the number of people experiencing extreme poverty in half.

Poverty has also become far less deadly as the world has invested in lifesaving care, such as vaccines and improvements during childbirth. From 2000 to 2024, life expectancy in low- and middle-income countries increased by more than six years. Malaria deaths dropped from 839,000 per year to 610,000. HIV deaths fell from 1.8 million to 627,000. And the world halved the number of children dying before the age of five—from nearly ten million to less than five million annually.

Overall, the past 25 years have seen the greatest improvements in life for the most people in history—with the progress primarily benefiting the world’s poorest. Most donor countries played a significant role in advancing that progress without spending more than one percent of their annual government budgets on aid. It is understandable that those who are still invested in health and development work focus their energy on disproving the myth that aid has failed. But they must also be careful to not get so bogged down in trying to defend the successes of the past that they miss a vital opportunity to help global institutions evolve for a new era.

Although cuts to aid in 2025 were the immediate result of budget pressures and global instability, they were also the culmination of a series of problems in the post–World War II architecture of international development. One problem has been a failure to transition from charity to investment in local capacity that enables progress to........

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