AP: American Red Cross disaster funds are depleted

According to the Associated Press, its national disaster relief fund is depleted and its has started taking out loans to pay for relief in Midwestern states affected by recent flooding. Chief Development Officer Jeff Towers said “[we] would borrow to keep workers and volunteers in the field helping flood victims.” This announcement is troubling enough on its own, and is made worse by its timing. As the summer season swings into full force, so do natural disasters such as hurricanes, tornadoes, and heat waves. Current Red Cross estimates for Midwest flood relief put the figure around $15 million, but it could grow as large as $40 million. Mr. Towers reported that the organization has only collected $3.2 million through June 16. Impeding fundraising efforts are myriad problems ranging from the state of the US economy to aging baby boomers (a core donation demographic now finding itself with limited disposable income) to image problems resulting from the organization’s response to 9/11 and Hurricane Katrina.

The shortage of funds stems largely from a surprising problem: a lack of major disasters. Thanks largely to the widespread media coverage and awareness, major disasters account for a substantial portion of the funds raised to support the domestic disaster fund. The last few years have seen a series of smaller and mid-size disasters, such as isolated tornadoes in Kansas, and “silent disasters,” which do not garner the national and international attention that Hurricane Katrina did. This situation, perverse on the surface, leaves the Red Cross in an uncomfortable situation and puts disaster relief at the mercy of the Red Cross’ lenders.

Further reading:

  • The AP article can be found here.
  • Visit the Red Cross online at www.redcross.org.
  • Hear more about the shortage in this piece from NPR’s Day to Day.