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Red Cross Disaster Fund Is Broke

As economy wreaks havoc with donations, relief agency down 'to zero'

By Peter Fearon,  Newser Staff

Posted Jun 17, 2008 8:35 AM CDT

(Newser) – The American Red Cross, reeling from dealing with catastrophic floods in the Midwest, is facing its own disaster as it runs out of money to pay for relief aid. The charity has raised just $3.2 million to pay for shelters, food, and other costs—a fraction of the $40 million that may be needed in seven states hit by floods, reports the Washington Post.

Donors are giving less because of rising gas and food prices and the collapse of the housing market. The funding crisis is especially acute as hurricane season looms. "The disaster relief fund is completely depleted. The balance is zero," said an organization official.

Mary Gillespie  uses a walker as she walks into a Red Cross shelter  in Cedar Rapids, Iowa.
Mary Gillespie uses a walker as she walks into a Red Cross shelter in Cedar Rapids, Iowa.   (AP Photo/Steve Pope)
Tammy Lane-Sanborn sits on a cot at a Red Cross shelter in Cedar Rapids, Iowa. The American Red Cross says its disaster relief fund is down to zero.
Tammy Lane-Sanborn sits on a cot at a Red Cross shelter in Cedar Rapids, Iowa. The American Red Cross says its disaster relief fund is down to zero.   (AP Photo/Steve Pope)
Illinois resident struggles to pile sandbags.
Illinois resident struggles to pile sandbags.   (AP Photo/Seth Perlman)
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