John Hood highlights two traditions that have shaped philanthropy today in its quest to provide public goods through private action.

The compassion tradition, which in the West had its origins in Jewish and Christian history, reflects our efforts to alleviate suffering, save lives, foster virtue, and restore what is broken. The community tradition, which in the West had its origins in the city-states of the Greek and Roman world, reflects our efforts to elevate communities, enrich lives, foster new intellectual and artistic achievements, and preserve what is great and beautiful.

A recent report finds that three-quarters of the funding for private non-profit human service providers comes from governments. Not coincidentally, 12 percent of the organizations whose finances are examined are technically insolvent and nearly a third have reserves less than their monthly operating expenses. Fortunately, a number of great organizations are as well run as they are well meaning.