This text charts how President George W. Bush's "compassionate conservatism" creates a new path for American social policy. There is a growing interest in testing the proposition that faith-based organizations (FBOs) could do even greater good, especially if government supports an expanded role. FBOs represent a potentially valuable, but controversial, resource because they offer to fight a very different war among America's social ills. The work offers three conclusions. First, FBOs are effective in dealing with chronic social problems because they spark personal transformation. Second, financing FBOs through the Tax Code or vouchers is preferable to direct federal funding. The fear that public funding means government take-over of religion serves as perhaps the greatest impediment to a more expansive role for FBOs. Third, although predicting the US Supreme Court's resolution of church-state issues is fraught with difficulties, the emerging "equal treatment" of religion by the High Court suggests a more permissive attitude toward the federal funding of FBOs. The tax and voucher alternatives seem certain to pass constitutional muster.