Monday, September 8, 2008
On September 6, 2008, the Washington Post reports that Hurricane Gustav has caused the American Red Cross to face sever financial difficulties. Here is an excerpt from the story:
The Red Cross has raised less than $5 million toward its Gustav expenses, officials said. To recoup its Gustav cost -- most of it borrowed money -- the nonprofit organization plans to roll out an aggressive national campaign Monday.
In 2005, the Red Cross borrowed money for the first time in its 127-year history when it took out a $340 million loan to help pay for its $2 billion response to hurricanes Katrina and Rita. The nonprofit organization quickly raised the money to cover the debt.
But because Gustav weakened as it churned onto the Gulf Coast, Americans struggling in a soft economy have not responded with an outpouring of giving as they did three years ago when Katrina left indelible images of devastation and suffering. Gustav spared New Orleans the death and destruction that forecasters predicted but dampened donations to the Red Cross, which mounted one of its largest mobilizations in years.
Fundraising is "nowhere near the pace that we would need it to be," said Joe Becker, senior vice president of Red Cross disaster services. He called the situation "daunting."
For the entire story, see "Gustav Relief Sends Red Cross Into Debt" in the September 6, 2008, issue of the Washington Post.