Friday, September 23, 2011

FIPE HUNT: The five-paragraph monster that lurks in the lives of freshmen

I dedicate this post to everyone who has ever had to teach or learn the five-paragraph essay.

Hopeful freshmen with healthy colons on a beautiful autumnal day at the beginning of their college careers.

An ulcer-stricken freshman after a semester doing battle with the five-paragraph essay.
      Every September, several million 17- and 18-year-olds, fresh from the realities of pushing perfume at Sears or backpacking in the Rockies, enter for the first time the Oz of college. They should be warned: higher education offers nothing as real as rose water or as substantial as trail mix. The halls of academe are instead built on foundations of dream—and nightmare. On the one hand, for example, these fresh-faced freshmen will get to float through immaculately crisp November afternoons while huddled under improbably cozy blankets on impeccable 50-yard-lines with impossibly gorgeous dates who have implausibly clear skin and unthinkably excitable hormones, and this will spoil them for the plain, pock-marked realities of real life forever after. On the other hand, as if to pay for such rare dreamy moments, they will have to endure certain horrors: they will be asked to wrestle with Plato and Chomsky and other thinkers who are out of their weight class throughout interminable afternoons in musty lecture halls; they will be forced to torture rats until the pitiful inbred rodents learn to tap-dance on metal bars in rank psychology labs; they will be made to spit verbs and disgorge adjectives in strange languages that they will never have to speak in real life. But of all the unrealities the kids must face there is one that is more preposterous, more unnatural, more terrifying than all the others put together. It is . . . the Five-Paragraph Essay. The abominable Fipe.
     In the real world there is no such thing as a Five-Paragraph Essay. It does not exist in books, newspapers, or magazines. It is said to live only in locked desk drawers in the dim, airless corridors of the top floor of the English Building. It is quarantined there like the four-legged chickens in the cages of the aggie school and the recombinant viruses in the retorts of the biology lab. If allowed to escape, the Fipe could in fact be a danger to the general environment, spawning five-paragraph corporate memos, five-paragraph love letters, and, gasp, five-paragraph emails. Given its origins, however, it is unlikely that the Fipe could live for long outside the English Department’s stale atmosphere. For the Fipe is a monster conceived by the high priests of the ivory tower: The Freshman Composition Instructors. The Instructors themselves are creatures who fainted and failed in the real world long ago and who thereafter retreated to a tiny fantasy-filled empire where, like the Wizard, they can impose whatever strange and arbitrary rules they want on those unlucky enough to stumble into their domain. They reign by bluff and bluster. “Connect!” they bellow. “Explain! Develop!” They sometimes speak in magic tongues designed to awe their subjects: “Ref! Org! Awk!” they cry. Before them the callow freshman cowers, like Dorothy in the smoke of the Emerald Palace. Whenever they sense rebellion, the Instructors simply send their subjects out to find the Fipe, thereby distracting them from all other pursuits.
The Most High Instructors of Freshman Comp: Keepers of the Five-Paragraph Mysteries
     But few are they who have seen the face of the Fipe. In fact, it is said that only the Most High Instructors themselves know what a genuine Fipe looks like. Its brow is thought to be gray, lined, sweaty, and vague—it bears, in other words, the unmistakable symptoms of A Main Idea. Its body, like that of certain insects, has three indented parts, each connected to the head by a network of nerves as fine and fragile as spider’s silk. It has a tail, sometimes long and bushy, sometimes short and bare. It is reported to feed on specific examples and concrete images. (“The beeping watch on his hairy left wrist, for instance, gave Jane the hives”—chomp! “Two wet sweat socks and a pair of soiled jockey shorts lay on the bishop’s pillow”—gulp! “An orange cat patchy with ringworm recited the prologue to The Canterbury Tales in the fetid pound”—chomp! gulp! burp!) The Fipe’s favorite pastimes are said to be arguing, analyzing, clarifying, comparing, contrasting, supporting, defining, discussing, reflecting, and telling tales; no one, according to legend, can stand to be around it long. The Fipe is rarely passive, except when unwell. No two Fipes look, smell, feel, sound, or taste exactly alike, though each must be perfectly Fipe-ish in its own way. No freshman has ever caught a genuine Fipe, though once a semester a girl who wears heavy glasses will come running into English 1101, Section 32, flushed with hubris and armed with a perfectly printed manuscript, swearing she has snared one. Three days later, The Instructor, wearing a smirk of sympathy, will return her offering to her, its body bleeding red ink and its forehead carved with a large scarlet “C”—and that will be that. The Fipe, whatever it is, will remain at large. The girl with the heavy glasses will never be seen again.
The girl who thought she had snared the Fipe instead received a scarlet C and was never seen again.
     In recent years, a movement has surfaced in some English Departments to end the annual autumnal hunt for the Fipe. The movement’s adherents, some of whom were once inner-sanctum Instructors themselves, claim the creature is nothing more than a superstition, like the Fat Liberal or the Blushing Republican. In fact, in some areas of the country, mostly on the coasts, mysterious campus sects are said to practice rituals designed to call up creatures larger and smaller, less perfect and less symmetrical than the Fipe; youthful members of such sects are encouraged to bring in shapeless eight- or ten-paragraph animals that bear only the vaguest resemblance to the Fipe. These creatures are said to be pleasing to the eye, and the youngsters inordinately fond of them. The Most High Instructors consider all this heresy, of course, and the Fipe hunt remains in effect throughout most of the nation. Without it, The Instructors claim, the minds of the nation’s youth will deliquesce into sugar-free, decaffeinated soft drinks, and they will be left as errant as butterflies. The heretics say that that might not be so bad.
     In the meantime, this autumn, as always, as the whiz of the Frisbee and the roar of the frat are heard throughout the land, eager freshmen have once more wandered onto our yellow-brick campuses. With their bright eyes, clear heads, and healthy colons, they have arrived blissfully ignorant of the Five-Paragraph Essay and its dangers. Before the final bell tolls, the healthiest of them will be bleary, blithering, and ulcerated. Making certain of that will be the Most High Instructors of Freshman Comp.
     And the Wicked Which of the Worst: The abominable Fipe.

A freshman paper bloodied in the quest for the five-paragraph essay.


The original version of this essay first appeared in Memphis magazine in October 1987.

Thursday, September 22, 2011

WHY IT'S OKAY TO RAISE TAXES ON THE RICH: If anything, the wealth of the wealthy is now undertaxed

Warren Buffett (top) and Bill Gates (bottom): Two nice rich people who think that taxes on the rich should be raised.
Recently the local newspaper has been full of columns and letters praising rich people for the jobs they create and the taxes they pay. Most of these columns suggest that those who, like President Obama, want to raise taxes on the rich must “hate” them and are engaged in “class warfare.”
     I don’t hate the rich. I know a few millionaires, and most of them are decent, generous people. I like them.
     Nevertheless, I do think it is appropriate to raise their taxes in order to buttress the federal budget and thereby protect all our grandchildren from future financial crises.
     Let me explain my position with a hypothetical but realistic example:
     On the one hand, we have Richie Rich, CEO of Rich Inc., a Fortune 500 company. Last year, Rich made $2 million in taxable income (line 43 on Tax Form 1040).
     On the other hand, we have Average Joe, who made $50,000 in taxable income working for Mr. Rich’s company—rather better than average income for an American worker, but solidly middle class.
      Both Joe and Richie are married, filing jointly.
      For 2010, Joe paid $6,666 in federal income taxes—about 13% of his taxable income.
      For 2010, Richie Rich paid $629,760.25 in federal income taxes—about 31% of his taxable income.
      In other words, Richie, whose taxable income was just 40 times as great as Joe’s, paid almost 100 times as much in taxes. This seems to suggest that Richie is indeed paying more than his fair share in taxes.
      Until you look closer at the facts.
      First, Joe is left, after federal taxes, with about $44,000 in spending money. Richie is left with about $1.4 million. Anyone feeling sorry for Richie yet?
      Second, the average Fortune 500 CEO in the U.S. in fact earns not 40 times but approximately 200 times more than the average worker. It is likely, in fact, that Richie, if he’s an average CEO, has earned another $7 million in stocks, stock options, dividends, deferred compensation, and so on. Stocks and stock options do not figure into his taxes. Instead, they are placed in his investment portfolio.
Since President Obama's stimulus plan took effect, the stock portfolios of the rich have increased 60% in value, yet stockholders pay no more than 15% in taxes on their stock dividends, capital gains, or increased wealth.
       Let’s look at that portfolio, which is a key to thinking about this subject. Let’s say Richie received $6 million in stocks in early 2009, as part of his CEO compensation. Since President Obama’s stimulus package went into effect that year, Richie’s stock portfolio, if it has kept up with the stock market as a whole, has risen more than 60%. (The Obama stimulus has been very good for corporations and rich people—don’t let the Republicans tell you otherwise.) That means that in the last two years, Richie, in addition to his salary, has grown wealthier by about $4 million. How much in taxes has Richie paid on that $4 million? If he has not sold his stocks, he has paid. . . nothing. If he sells those stocks after holding on to them for more than a year, he will pay taxes at a rate of just 15%—the top long-term capital gains tax rate. If he's been earning dividends from those stocks over that time—and I promise you he has—he has paid taxes on those dividends at a rate of just 15%. In other words, Richie will pay taxes on $4 million plus dividend income at just about the same rate that Joe paid on his $50,000! In fact, if Richie has held on to his stocks, he has paid no taxes on his increased wealth at all.
     Third, Joe last year paid a payroll tax (which goes toward Social Security and Medicare) of 4.2% of his entire taxable income. Richie, on the other hand, paid a payroll tax on only the first $106,000 of his $2 million income. In other words, Richie paid Social Security and Medicare taxes on just 5% of his taxable income. If both retire at age 66, Richie will get monthly social security checks that are double the size of Joe’s. Yes, Richie has put double the amount into Social Security, but will he really need social security at all? (Most supposed problems with the future solvency of the Social Security system would be taken care of with a “means test” on recipients: If you are rich enough that you don’t need Social Security—say, you make $100,000 or more per year by other means, such as dividends—you wouldn’t get it. The money you have put in would be considered your patriotic contribution to the security of the rest of the elderly population. Republicans don’t seem to believe in this kind of patriotism.)
The rich get a nice fat tax deduction on the mortgage interest for their big houses. Renters get no tax break at all.

      Defenders of the rich often note that Richie also buys big-ticket items—expensive cars, yachts, houses, etc.—on which he pays large sales taxes, while Joe, spending less, pays much less in sales taxes. True, but Joe, to make ends meet, must spend nearly all his leftover income on such things as computers and clothes for his kids, cars for himself and his wife, and gasoline to fuel the cars. Richie, on the other hand, can afford to spend a nice tidy $700,000 per year on stuff (only half his after-tax income) and still have $700,000 or so left over that never is subject to a sales tax (and is probably put into stocks or tax shelters the profits from which will never be taxed at the highest taxable-income rate). Bottom line: Percentagewise, Average Joe pays a lot more in sales taxes than Richie Rich.
     Finally, there’s a good chance Average Joe can’t afford a house; he rents. Richie Rich, on the other hand, has two big houses. He gets to deduct the mortgage interest on those houses from his personal income. Joe gets no such deduction. Who’s getting government welfare in that case?

This CEO says he plays golf 100 times a year. The average Fortune 500 CEO earns 200 times what the average worker does.
      I’ve never met a CEO who works 200 times as hard as the average worker—indeed, several of  the superrich CEOs I’ve known (and I’ve met a few) spend a certain number of their “work” hours with a golf club or a martini in their hand; I’ve seen them. (For more about CEO golf, go to this link.) Nevertheless, I believe that any person who creates a successful company from scratch, creates jobs, and pays his workers a reasonable wage is to be applauded. Indeed, opponents of an increase in the taxes of such people claim that raising their taxes (especially raising the capital gains and dividend taxes) would discourage them from starting new businesses and investing in innovative companies, thereby stalling out the economy and costing jobs. Higher taxes, they say, will sabotage entrepreneurship and fatally damage the financial system.
     History, however, says otherwise. Once upon a time (from 1950 to 1980), income taxes on the rich were above 70%, and the capital gains tax was double what it is today. Did the economy stall? Was there a slowdown in the creation of new companies? Were jobs lost? No, quite the opposite: It was one of the most economically successful periods in American history, with thousands of companies from Holiday Inns and McDonald’s to Microsoft and WalMart spearheading a huge growth in American enterprise and a vast increase in jobs.     
      So here’s the question: Would a 5% tax increase on the millions of dollars an enterprising businessman might earn really prevent him from creating a company that he expected to be successful? Not any of the businessmen I’ve ever met. They’re smarter, more confident—and, happily, greedier—than that.

In 1976, when Apple was founded, the capital gains and dividend taxes were 2-3 times higher than they are today, and the top income tax was double what it is today, but that didn't stop great entrepreneurs from starting great companies and hiring millions of workers. (For more on the history of capital gains taxes, see this link.)