With Karl Rove's "enduring Republican majority" under serious threat in the forthcoming national elections of 2006 and 2008, President Bush's faith-based initiative — a strategic quagmire from the beginning — has fallen completely off the radar screen. This is a good chance to step back and reconsider what the whole thing is really about. Shallow partisan scare tactics have particularly obscured the theological perspective of the faith-based initiative. This is unfortunate but not surprising, because the theological perspective opens the door to a debate on religion and poverty that neither opponents nor proponents of Bush's efforts are prepared to have.

Essentially, the goal of the faith-based initiative is to help religious groups obtain two things: a larger share of federal social welfare resources, and more autonomy in the federal contracting system. Short of federal funds being used directly for religious activities, the Supreme Court has consistently moved in the direction of supporting these goals since its watershed Bowen v. Kendrick decision in 1988.

Contrary to what liberal critics tend to argue, however, this is not simply a bid to "tear down the wall of separation between church and state." As the structure and purpose of the welfare state have changed in recent decades — devolving resources and many policy decisions to states and localities — rigid separation of church and state is an impractical barrier to policy implementation and in some respects quite discriminatory. The fact is, devolving welfare responsibilities means working more closely with religious groups — and that practical reality, not "recrudescent theocracy," is the main cause of constitutional changes in this area since the late 1980s.

This isn't to say that the faith-based initiative really is the next stage in the War on Poverty, as Bush described it in his remarkable Notre Dame Commencement speech of 2001. The fact is, Bush has not changed our anti-poverty policy at all. What has changed is who gets the resources and the authority associated with implementing the existing policy. Poor people and poor communities are imputed beneficiaries, but they are incidental, finally, to the primary goal of directing more federal funds to religious groups.

But if one truly cares about the future of poor communities in America, there is a theological twist in this story worth considering very closely. The overlooked truth of the matter is that the heart of the faith-based initiative is a religious understanding of the limited state known as "sphere sovereignty," a product of the Dutch Calvinist revival launched by Abraham Kuyper in the late nineteenth century. How this century-old European confessional lineage came to be so central to American welfare reform is the most important religious policy story of the last decade, in my view, but here I simply want to describe the main idea.

Against the monistic, centralized power of the rising liberal welfare state, Kuyperian sphere sovereignty requires government cooperation with churches in areas of mutual concern, such as welfare and education. The key principle underlying this cooperation is religious "self-governance," rooted in natural law. Essentially, this is the right of churches to serve the public good according to their God-given mission, purpose, and methods, without interference from the state. The doctrinal history of this stance originates in the theory of the two distinct powers of church and state formulated by Pope Gelasius I in the late fifth century.

Like the Catholic theory of subsidiarity, which emerged in the same period, sphere sovereignty articulated a larger mission of protecting the natural structures of society — families, churches, communities — from the homogenizing power of the liberal welfare state. But here is the interesting part. The state-like powers of large corporations and financial institutions also pose a significant threat to the diverse God-given purposes of families, churches, and communities. Kuyper openly said so, as did his Catholic counterpart in the struggle against liberalism, Pope Leo XIII. They recognized, as their conservative successors generally do not, that liberalism is not just a political and cultural assault, but also an economic assault. Liberalism shields this economic assault behind contractual rights that exclude the moral claims of families and communities. But sphere sovereignty reinstates these collective moral claims as a foundation of political order. On this account, the religious critique of liberalism increasingly will be forced to confront the destructive economic power that is hidden by the social contract.

When Bush is long gone, the faith-based initiative may live on in this more radical form — but only if we care enough about God's purposes to challenge liberalism at its economic core.

Lew Daly is a Senior Fellow of the Schumann Center for Media and Democracy and author of God and the Welfare State (MIT Press, 2006).