Claims that the New Orleans floods have laid bare a growing racial and economic divide in the US have, until now, been rejected by the American political establishment as emotional rhetoric. But yesterday's UN report provides statistical proof that for many - well beyond those affected by the aftermath of Hurricane Katrina - the great American Dream is an ongoing nightmare.

The document constitutes a stinging attack on US policies at home and abroad in a fightback against moves by Washington to undermine next week's UN 60th anniversary conference which will be the biggest gathering of world leaders in history.

The annual Human Development Report normally concerns itself with the Third World, but the 2005 edition scrutinises inequalities in health provision inside the US as part of a survey of how inequality worldwide is retarding the eradication of poverty.

It reveals that the infant mortality rate has been rising in the US for the past five years - and is now the same as Malaysia. America's black children are twice as likely as whites to die before their first birthday.

The report is bound to incense the Bush administration as it provides ammunition for critics who have claimed that the fiasco following Hurricane Katrina shows that Washington does not care about poor black Americans. But the 370-page document is critical of American policies towards poverty abroad as well as at home. And, in unusually outspoken language, it accuses the US of having "an overdeveloped military strategy and an under-developed strategy for human security".

"There is an urgent need to develop a collective security framework that goes beyond military responses to terrorism," it continues. " Poverty and social breakdown are core components of the global security threat."

The document, which was written by Kevin Watkins, the former head of research at Oxfam, will be seen as round two in the battle between the UN and the US, which regards the world body as an unnecessary constraint on its strategic interests and actions.

Last month John Bolton, the new US ambassador to the UN, submitted 750 amendments to the draft declaration for next week's summit to strengthen the UN and review progress towards its Millennium Development Goals to halve world poverty by 2015.

The report launched yesterday is a clear challenge to Washington. The Bush administration wants to replace multilateral solutions to international problems with a world order in which the US does as it likes on a bilateral basis.

"This is the UN coming out all guns firing," said one UN insider. "It means that, even if we have a lame duck secretary general after the Volcker report (on the oil-for-food scandal), the rest of the organisation is not going to accept the US bilateralist agenda."

The clash on world poverty centres on the US policy of promoting growth and trade liberalisation on the assumption that this will trickle down to the poor. But this will not stop children dying, the UN says. Growth alone will not reduce poverty so long as the poor are denied full access to health, education and other social provision. Among the world's poor, infant mortality is falling at less than half of the world average. To tackle that means tackling inequality - a message towards which John Bolton and his fellow US neocons are deeply hostile.

India and China, the UN says, have been very successful in wealth creation but have not enabled the poor to share in the process. A rapid decline in child mortality has therefore not materialised. Indeed, when it comes to reducing infant deaths, India has now been overtaken by Bangladesh, which is only growing a third as fast.

Poverty could be halved in just 17 years in Kenya if the poorest people were enabled to double the amount of economic growth they can achieve at present.

Inequality within countries is as stark as the gaps between countries, the UN says. Poverty is not the only issue here. The death rate for girls in India is now 50 per cent higher than for boys. Gender bias means girls are not given the same food as boys and are not taken to clinics as often when they are ill. Foetal scanning has also reduced the number of girls born.

The only way to eradicate poverty, it says, is to target inequalities. Unless that is done the Millennium Development Goals will never be met. And 41 million children will die unnecessarily over the next 10 years.

Decline in health care

Child mortality is on the rise in the United States

For half a century the US has seen a sustained decline in the number of children who die before their fifth birthday. But since 2000 this trend has been reversed.

Although the US leads the world in healthcare spending - per head of population it spends twice what other rich OECD nations spend on average, 13 per cent of its national income - this high level goes disproportionately on the care of white Americans. It has not been targeted to eradicate large disparities in infant death rates based on race, wealth and state of residence.

The infant mortality rate in the US is now the same as in Malaysia

High levels of spending on personal health care reflect America's cutting-edge medical technology and treatment. But the paradox at the heart of the US health system is that, because of inequalities in health financing, countries that spend substantially less than the US have, on average, a healthier population. A baby boy from one of the top 5 per cent richest families in America will live 25 per cent longer than a boy born in the bottom 5 per cent and the infant mortality rate in the US is the same as Malaysia, which has a quarter of America's income.

Blacks in Washington DC have a higher infant death rate than people in the Indian state of Kerala

The health of US citizens is influenced by differences in insurance, income, language and education. Black mothers are twice as likely as white mothers to give birth to a low birthweight baby. And their children are more likely to become ill.

Throughout the US black children are twice as likely to die before their first birthday.

Hispanic Americans are more than twice as likely as white Americans to have no health cover

The US is the only wealthy country with no universal health insurance system. Its mix of employer-based private insurance and public coverage does not reach all Americans. More than one in six people of working age lack insurance. One in three families living below the poverty line are uninsured. Just 13 per cent of white Americans are uninsured, compared with 21 per cent of blacks and 34 per cent of Hispanic Americans. Being born into an uninsured household increases the probability of death before the age of one by about 50 per cent.

More than a third of the uninsured say that they went without medical care last year because of cost

Uninsured Americans are less likely to have regular outpatient care, so they are more likely to be admitted to hospital for avoidable health problems.

More than 40 per cent of the uninsured do not have a regular place to receive medical treatment. More than a third say that they or someone in their family went without needed medical care, including prescription drugs, in the past year because they lacked the money to pay.

If the gap in health care between black and white Americans was eliminated it would save nearly 85,000 lives a year. Technological improvements in medicine save about 20,000 lives a year.

Child poverty rates in the United States are now more than 20 per cent

Child poverty is a particularly sensitive indicator for income poverty in rich countries. It is defined as living in a family with an income below 50 per cent of the national average.

The US - with Mexico - has the dubious distinction of seeing its child poverty rates increase to more than 20 per cent. In the UK - which at the end of the 1990s had one of the highest child poverty rates in Europe - the rise in child poverty, by contrast, has been reversed through increases in tax credits and benefits.