Giving Compass' Take:

• In this story from SSIR, author Dean Baker argues that executive salaries in the nonprofit sector are too high, and charitable tax deductions effectively mean the public pays for those bloated salaries.

• If nonprofits are to heed Baker's advice and reconsider either charitable tax deductions or nonprofit executive pay, what consequences might this have on the efficacy of nonprofit organizations? Can nonprofits remain competitive in the labor market with lower executive salaries or less funds going toward salaries?

• To learn about the growing CEO-worker pay gap, click here.

An average family participating in the federal Temporary Assistance for Needy Families (TANF) program costs taxpayers $400 a month. We pay $126 a month to the typical beneficiary of food stamps—the Supplemental Nutrition Assistance Program (SNAP).

By contrast, Susan Desmond-Hellmann, the CEO of the Bill & Melinda Gates Foundation, costs us $44,200 a month. This figure may catch some readers by surprise, because they probably don’t think of themselves as paying the salaries of people who work at nonprofit organizations. But we do pay her that amount, and it is a problem.

The salary of the Gates Foundation’s CEO costs taxpayers money because we gave Bill Gates a large tax break that subsidizes his contribution to his eponymous foundation or any other philanthropy.

As a practical matter, if we are serious about combating inequality, we have to recognize that we are not going to reverse a four-decade-long trend with a single step. If the beneficiaries of the policies that promoted inequality can protect their position by pointing to some other group that got even larger gains, then we will never be able to make any progress.

In this case, we should keep our eye on the ball. The federal government is providing enormous subsidies to the bloated pay of top executives at nonprofits. This is simply not a good use of federal dollars, and it is hardly in keeping with the idea that nonprofits should be serving a public purpose. We can try to develop government policies to reverse market outcomes that generate inequality, but we should first end government policies that promote inequality.

Read the full article about nonprofit sector salaries by Dean Baker at Stanford Social Innovation Review