GIVING WELL
Advantage: God
Why the Salvation Army beats the Red Cross.
The American Red Cross ran up a white flag recently, surrendering to critics who had accused it of bait-and-switch fund raising by planning to hold back more than half of the $543 million it had raised for victims of the Sept. 11 attacks. Officials pledged that just about all of the money (minus $49 million for overhead) would go to the victims for whom it had been given. Red Cross president Bernadine Healy had already resigned from her $450,010 position, but not before suffering a tongue-lashing from Rep. Bart Stupak (D., Mich.). Reporting that some of his constituents had driven to New York City to give the Red Cross a check, Mr. Stupak said, "They expected that check to be used now, not two years from now."
Red Cross officials put up a reasonable defense: They had protected their organization's ability to help in the future by placing $200 million of the donations in a reserve fund and by planning to use millions more to improve the charity's infrastructure. What the $2.5 billion organization had forgotten, though, was American charity's "just in time" tradition: Keep a very low inventory; go with all the resources you have right now; when the next emergency hits, call upon the American people once again.
This is how charity has worked in the past. The Red Cross charged in on April 18, 1906, when an earthquake destroyed most of San Francisco and left at least 3,000 dead and tens of thousands homeless. Jack London ended his earthquake reporting in Collier's magazine by noting, about the Red Cross-led relief effort, "thanks to the immediate relief given by the whole United States, there is not the slightest possibility of a famine."
Churches and labor unions did crucial work. Local 442 of the Plumbers, Gas and Steam Fitters' Union voted "that all members would volunteer their services on relief work." Some 500 did, working for a week to repair broken pipes.
Big businesses, particularly railroads, volunteered to get supplies in quickly. The Southern Pacific and Union Pacific railroads made free shipments to San Francisco a priority. As the San Francisco Chronicle reported, "Passengers on fast trains saw flying freights, every car labeled 'relief,' go by, while the passengers took the sidetrack."
By the time of San Francisco's 1989 earthquake, though, much of American charity had become bureaucratic, and San Francisco's Mayor Art Agnos complained that the Red Cross, after raising $50 million, was passing along only $10 million and banking the rest for use in future disasters and organizational expansion. After several weeks of complaints by contributors, the Red Cross relented. Critics also protested Red Cross holdbacks following the Oklahoma City bombing in 1995, Red River flooding in 1997, and a San Diego wildfire early this year.
The pattern indicates a Red Cross perspective that is logical but tin-eared. Red Cross officials emphasize long-term planning rather than short-term reacting. They justifiably worry about a media-driven populace's tendency to write checks based on television coverage. They pay well, and don't see anything wrong in the CEO of a billion-dollar philanthropic outfit, who can't even receive stock options, earning big bucks.
The response of public opinion: Charities are different. They are expected to be bold and courageous, risking all like New York City firemen running into buildings when everyone else is rushing out. Leaders who play by normal business rules and pay themselves normal business salaries are stung.
Nor is this an impractical reaction. The evidence shows you don't have to be as heavily bureaucratized as the Red Cross (or the United Way, which has also been scandal-ridden) to be effective in the crunch. The $2.1 billion Salvation Army USA shows a different way to help. Peter Drucker has called the army the "most effective organization in the United States. No one even comes close to it with respect to clarity of mission, ability to innovate, measurable results, dedication, and putting money to maximum use."
The Salvation Army's response on Sept. 11 was impressive. Army officers and volunteers by the hundreds headed to New York City without even being asked. The army quickly set up 21 mobile feeding stations in Manhattan that served 300,000 meals during the 72 hours after the disaster. Worth magazine reported that the Salvationists were thoughtful enough to bring "hundreds of teddy bears to comfort the children of the victims, and Vicks VapoRub for the rescuers to smear inside their nostrils to cover the acrid stench of death and burning metal."
While the Red Cross practiced organizational damage control over the past month, several reporters noted that the Salvation Army pays its top executive, John Busby, $13,000 a year, plus frugal room, board and transportation expenses. The Army, with no marketing department and a slim public-relations staff, relies on attention generated by its well-known red shield and press coverage of its high-profile efforts. Army officers work long hours for little material reward, largely because of the attitude Mr. Busby offers interviewers: "I don't miss anything you can buy with money. I'm in the will of God, doing what he wants me to do. There's no higher purpose than that."
There's the catch: Salvationists believe in salvation, and they pass out Bibles along with hot meals. Their zeal is reflected in the organization's mission statement: "The Salvation Army, an international movement, is an evangelical part of the universal Christian Church. . . . Its mission is to preach the gospel of Jesus Christ and to meet human needs in His name without discrimination."
Religious initiatives like the Salvation Army are growing these days, in part because they offer a striking alternative to bureaucracy-based hesitancy. The Red Cross can respond quickly to emergencies, but mayors and many others have criticized its understandable unwillingness to bet the farm every time out. Other charities, however, have a higher purpose than organizational survival. They, like others, need good management, but what gets them moving fast is faith in God.
Mr. Olasky is editor in chief of World magazine and a senior fellow of the Acton Institute.
