Rescuing the Red Cross

Even as the Red Cross sheltered nearly 500,000 people and served nearly 65 million meals and snacks during last fall's unprecedented hurricane season, Americans watched the charity struggle with overwhelmed call centers, underserved communities, and supply problems.

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Confidence has also been shaken by recent allegations of fraud in food distribution and warehousing in New Orleans (the Red Cross is cooperating with the FBI on those charges). And an investigation in Congress, which established the charity's charter, highlights significant management problems that predate Katrina. Chief executives spin through this charity of charities, for instance, and a bloated board of 50 people (mandated by Congress) seems more concerned with turf battles than teamwork and oversight.

That's not just a bad reputation, but a reality that needs to be beaten back. So it's encouraging to see that this 125-year-old institution is treating the criticisms seriously - drawing up and responding to a "lessons learned" list and undertaking its first governance review in 60 years.

In a response to inquiries by Republican Charles Grassley of Iowa, whose Senate Finance Committee is leading an inquiry, Ms. McElveen-Hunter appears to be hearing the complaints of lawmakers and others.

To better deal with waste and fraud, the Red Cross will standardize financial controls among its 815 local chapters, and hire more investigators to handle complaints. Multiple ways of dispersing funds to people in need mean multiple opportunities for slip-ups. Now the charity wants to devise a single method to distribute funds.

The Red Cross has also been battered by gale-force criticism over inadequate cooperation with local charities and religious groups. In an operational and cultural switch, it plans to share funds and training with such groups, a move that will increase and strengthen its army of volunteers. It's also hired a vice president of diversity who should see to it that more minorities - including Spanish speakers - work on the front lines.

Some in Congress are so fed up they question the Red Cross's designated role as the charity that government turns to first after a disaster.

But that's an overreaction. For all its shortcomings, the Red Cross outperformed the federal government last fall, and through its chapters, it has reach and experience that would be hard to re-create. Katrina was 20 times larger (in terms of people affected, volunteers needed, and funds required) than anything the Red Cross has ever had to deal with, yet it still fielded over 200,000 volunteers. Since then, it has responded to about 28,000 other US disasters, including the recent spate of terrible tornadoes.

Joshua Gotbaum, former head of the September 11th Fund, calls the Red Cross a national treasure which shouldn't be buried. It seems though, that everyone recognizes it needs heavy-duty polishing, and that's the first step to rebuilding trust.