Guess Who Gets the Most Brazen Federal Inflation Adjustment in the Country?

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I learned something new today. Apparently the federal government has a cap on the amount it’s willing to reimburse contractors for the salaries of their employees. If someone makes $50,000 per year, no problem. You can charge the feds for their entire salary if they’re working on government business. But if your company’s CEO makes $3 million per year, you can’t charge it all back to the feds even if 100 percent of the CEO’s time is spent on government contracts. The limit, set in 1998, was $340,000.

This cap was allowed to rise with inflation, so you’d figure that by 2011 it would be around $467,000. But no. It was $763,000. Why? Because ordinary inflation adjustments are for chumps, that’s why. For purposes of charging CEO overhead to the federal government, the cap was set at “the median amount of the compensation provided for the five most highly compensated employees of all publicly owned U.S. corporations with annual sales in excess of $50 million for the most recent fiscal year.”

Isn’t that fabulous? When it comes to the minimum wage, we don’t index for inflation at all. But for CEOs earning top-one-percent pay, we not only index for inflation, we index to the rise in CEO salaries. And since CEOs have been relentlessly voting themselves ever more astronomical compensation over the past few decades, we know that number is going to rise a whole lot faster than piddly old CPI. Ka-ching.

This comes via Lydia DePillis, who’d like to talk about raising the compensation floor, not just cutting the CEO cap back down to size. Good luck with that.

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WE'LL BE BLUNT

It is astonishingly hard keeping a newsroom afloat these days, and we need to raise $253,000 in online donations quickly, by October 7.

The short of it: Last year, we had to cut $1 million from our budget so we could have any chance of breaking even by the time our fiscal year ended in June. And despite a huge rally from so many of you leading up to the deadline, we still came up a bit short on the whole. We can’t let that happen again. We have no wiggle room to begin with, and now we have a hole to dig out of.

Readers also told us to just give it to you straight when we need to ask for your support, and seeing how matter-of-factly explaining our inner workings, our challenges and finances, can bring more of you in has been a real silver lining. So our online membership lead, Brian, lays it all out for you in his personal, insider account (that literally puts his skin in the game!) of how urgent things are right now.

The upshot: Being able to rally $253,000 in donations over these next few weeks is vitally important simply because it is the number that keeps us right on track, helping make sure we don't end up with a bigger gap than can be filled again, helping us avoid any significant (and knowable) cash-flow crunches for now. We used to be more nonchalant about coming up short this time of year, thinking we can make it by the time June rolls around. Not anymore.

Because the in-depth journalism on underreported beats and unique perspectives on the daily news you turn to Mother Jones for is only possible because readers fund us. Corporations and powerful people with deep pockets will never sustain the type of journalism we exist to do. The only investors who won’t let independent, investigative journalism down are the people who actually care about its future—you.

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Getting just 10 percent of the people who care enough about our work to be reading this blurb to part with a few bucks would be utterly transformative for us, and that's very much what we need to keep charging hard in this financially uncertain, high-stakes year.

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