Red Cross Under Heavy Fire
Over 911 Disaster Funds
By Samantha Levine
US News & World Report

As the world's most venerable charity, the American Red Cross serves on the front lines of nearly 67,000 disasters a year, from house fires to calamitous floods. But now the 120-year-old organization is facing a decidedly different kind of storm.

The ironic cause of the tumult? Too much goodwill. After September 11, Americans opened their wallets and veins as never before to deliver unprecedented amounts of moneyñroughly half a billion dollarsñand blood to the American Red Cross.

The amountsñstaggeringñhave caused a host of unanticipated problems. For one, the money has not gone entirely to victims through the Liberty Relief Fund, as donors believed it would. And some of the blood had to be thrown away because it has a limited shelf life.

So the Red Cross, accustomed to receiving compliments, suddenly was slapped with complaints. Already the fallout has been clear. High-profile former President Bernadine Healy was forced from her $450,000-a-year post. And Congress is giving the charity a skewering. "Like a kid in a candy story, they got big eyes," says Louisiana's Rep. Billy Tauzin, whose House subcommittee held a contentious hearing on the issue. "The question is whether they misled the American public or not, and I think they did."

Healy says she repeatedly explained that the funds were never "only for the victims." Even so, the Red Cross is reassessing how it will spend the $264 million that will remain in the Liberty Fund after it doles out the $300 million earmarked for relief tied to September 11.

Unique charter. Typically, the Red Cross has not been in a position of publicly explaining itself to Congress. But there are limits to the charity's independence. It is chartered by Congress and required to operate according to terms outlined by the federal government. Rep. Bart Stupak, a Michigan Democrat on the oversight panel, says the Red Cross should expect either a written reprimand from Congress or another Capitol Hill hearing to discuss possible redress.

And the spotlight could also engender a slump in giving and in confidence in charities. So now the Red Cross is scrambling to regain the public's good graces. "If we don't subject ourselves to public scrutiny, we will never have public trust," says David McLaughlin, chairman of the Red Cross's board of governors.

It was internal scrutiny that undid Healy's tenure. By her own account, she was pushed out from the top job by board members who didn't like her aggressive handling of the 9-11 funds, among other things. "I was too tough," she tells U.S. News. "There was not one substantive reasonñzero, nada, nothing," she says.

Healy, 57, provides documentation supporting her contention that she kept the board fully apprised and says that war requires the Red Cross to do whatever necessary to relieve suffering.

Now, the Red Cross says it won't add money to the Liberty Fund unless donors specifically request it. Instead, all monies gathered after October 31 will be put into the Disaster Relief Fund. An auditing firm has been retained to keep tabs on the expenditures. "My highest priority is that the Liberty Funds are disbursed quickly, efficiently, and appropriately," says Harold Decker, now the interim CEO.

For her part, Healy has come to recognize that perhaps she and the Red Cross just were not the right fit. "Despite the many successes," she wrote to the board in a farewell note," what you really wanted was a different personality . . . maybe . . . more of a Mary Poppins and less of a Jack Welch."
From Bonnie Moore
The more the Red Cross tries to save it's own butt, the further it sticks it's head in the sand. How dare they be so judgemental by giving what "They" think someone needs to live their lifestyle for a year? It's the same old "those who have, is those who gets"
The only fair way to distribute the money is to get a list of those who lost loved ones, from Emperor Rudy, making allowances for the children and divide the mone equally. It's too bad if one pays $5000 a month and the next person can only afford $500.Divide it equally and Give them all the money so far collected, (much more is on the way) let them save it as they like.The same should go for the other 140 charities who have collected funds. Get them on the hot seat, too.


This Site Served by TheHostPros