Why Always the Red Cross with Its Poor Track Record?

When calamity strikes, it is ritual for every newscast to urge us to give generously to the American Red Cross. What about other charities? For them "there is a list on our website". Corporations pile into the media with ads urging the same. We just saw this appeal after Houston. We'll see it again when the still more terrifying Category Five Irma rips into Florida or the eastern seaboard. The Red Cross automatically gets top billing to the near exclusion of all other aid groups.

This goes on in spite of a very dicey record across the years which should have caused those news purveyors do their homework and instead promote others charities — local food banks in Houston, Corpus Chrisiti and Beaumont for example, or operations that will help remediate houses.

After Katrina in 2005, the Red Cross collected $1.2 billion, 70% of all the donations by Americans for hurricane relief. Contributing to this lopsided skew, FEMA released to the media a list containing the Red Cross — as if it needed further promotion — 19 faith-based charities, the sort favored by the Bush administration, and almost no other established relief organizations.

The huge, long-term undertaking of rebuilding houses and businesses for hundreds of thousands of displaced Americans was Job #1, yet the Red Cross grabbed most of the money. It defines itself only as a first-responder. It said it would spend only on the short-term needs of emergency shelter, food, and financial assistance, but wouldn't be participating in the larger, ongoing costs of rebuilding. But it never told America to stop sending it money.

An op-ed piece in the Los Angeles Times by the head of Operation USA, a 26-year-old international disaster relief agency based in Los Angeles, told us that the Red Cross' avarice was even worse:

"FEMA and the affected states are reimbursing the Red Cross under pre-existing contracts for emergency shelter and other disaster services. The existence of these contracts is no secret to anyone but the American public. [Red Cross] fundraising vastly outruns its programs because it does very little or nothing to rescue survivors, provide direct medical care or rebuild houses.”

Even in these limited roles there were complaints of disorganization and invisibility in some Gulf areas, reported The Chicago Sun-Times (and the mention by one church pastor that, whereas his congregation was serving full meals to evacuees, the Red Cross was handing out doughnuts and coffee).

By contrast, Habitat for Humanity was in New Orleans for the long term. It devoted its funds to housing and launched "Operation Home Delivery". Volunteers all over the U.S. built sections of houses to be shipped to afflicted areas for assembly. The Red Cross did not participate.

Katrina was not the first time the Red Cross went long on money and short on services. After 9/11 it was revealed that only 30% of the $547 million collected for the specific benefit of victims had been paid out to them, forcing the resignation of Red Cross president Bernadine Healy. Similarly, after the 1989 San Francisco Bay Area earthquake, it was found that, of $50 million collected for victims’ relief, $40 million was held back for future calamities. Holding back money is what the Red Cross must do to provide assistance when lower-key trouble strikes that doesn't inspire donations. But that's not what people who thought they were helping San Francisco were told. The Red Cross never reports transparently about what it's done — or not done — with everyone's money.

In January of 2010, Haiti was ripped by an earthquake that killed an estimated 160,000 people and left the housing stock in a shambles. The Red Cross, which is designed only to provide the immediate assistance of food,
Port au Prince, Haiti, after 2010 earthquake.
hygiene kits, blankets and temporary shelter, was showered with $488 million, far more than such aid called for. “There’s only so much money that can be forced through the emergency phase,” an Red Cross spokeswoman told an Associated Press reporter. Faced in Haiti with what to do with so much money, the charity undertook to build houses. ProPublica found that after five years the Red Cross had only built six permanent houses. Other charitable organizations had built 9,000.

The charity "funded dozens of projects to improve schools, hospitals and infrastructure", said a New York Times editorial, by handing off some of its surplus to other organizations (after taking their customary 9% cut for "administrative costs", one the $517,364 currently paid to CEO Gail McGovern). But the ProPublica report prompted a Senate investigation (the American Red Cross was chartered by Congress in 1905) which revealed that after five years only 25% of the Red Cross' total take for Haiti had been spent by them or others.

A year ago March, when four days of rain in Louisiana caused record-breaking floods that damaged 5,000 homes, the Red Cross' performance was met with universal condemnation.

"Most of the parishes who reached out to the American Red Cross were not happy with the assistance they received or did not get some or any assistance",

was the assessment of a FEMA manager, reviewing complaints from around the area. Red Cross staffers didn't answer phone calls requesting assistance. They brought too few shelters. They made commitments they didn't keep. “‘Red Cross’ was a nasty word around here,” said a pastor from Calcasieu Parish, who had organized religious groups that had been feeding evacuees and first responders up to 800 meals a day for most of two weeks. When he asked the Red Cross for a mobile kitchen to help out, he was told they could not until they got a "voucher". When it came, only three days of food was supplied.

Give generously, but go to those website lists to make different choices. They need money; the Red Cross doesn't.