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fellside

The US Debt

102 posts in this topic

please note that you've now attempted a mere 1 (incoherent) sentence in any way related the actual topic of the thread, the U.S. debt, out of 7 posts.

if you have nothing to say about the U.S. Debt, why are you posting in this thread?

Well I had one thing to say about the discussion in this thread, and I said it in a variety of ways already. All other "responses" (again, thanks for counting.) were about posts directed towards me. Once again, the world revolves around how smart blackstar really is, let's all applaud at how his posting has changed our lives.

Now, I , on the other hand, not to toot my own horn but have received multiple private messages regarding how I have said something that has deeply impacted their lives. This thread should be about me and how awesome I am for penetrating your little skull-hole with sanity. B)

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RE: Social Security.

http://www.nytimes.com/2010/11/15/opinion/15orszag.html?hp

it appears as a sidenote in that article that Healthcare costs are what we should focus on in order to really tackle our long-term budget crisis, and the best way to bring them down is the way most unpalatable for Republicans: a single-payer system. the Healthcare bill already passed is a good step that is expected to significantly lower overall costs over the next 2 decades already, but contains a number of awkward complications, such as penalties for those without insurance who refuse to buy in and a punishment for businesses who don't cover employees, while still not achieving universal coverage. it also leans into, rather than away from, the ability of existing big health insurance companies to provide coverage at a profit; which some may call an ideological point but i believe is a vital, fundamental difference in impetus for providing care. as long as for-profit companies have the lead in providing insurance for care, we're going to see malicious infringement on people's ability to get the best possible care when they need it; as it isn't always in a company's best financial interest for people to receive it. the sooner we move away from that system as our primary means of healthcare, the better off we'll all be and, it seems, the better off our budget will be (though obviously economists on different ends of the ideological spectrum dispute the latter).

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Would like to see Obama's part on that list.

maybe when his term(s) end in 2-6 years we will. the man's had 23 months to overcome the worst mess left to an incoming President since James Buchanan left his to Abraham Lincoln.

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To me, blaming Obama for this is like blaming the guy who hits the brakes when it takes too long to stop after the previous driver ran the car up to 200mph.

Didn't say that. Just saying Obama's numbers aren't going to look anything like Clinton's.

And while you can say it's unfair to blame Obama, one could say the same about giving credit to Clinton. After all he spent 6 of his 8 years with a Republican congress while he bent over backwards to make sure people saw him as a moderate. No to mention that he happened to fall into the internet boom.

And while I think Bush was a blithering fool of a president and I put a huge amount of blame on him, the mortgage crisis wasn't his doing. Plus replace him with almost anyone in 2001 and they would have still taken us to war with Afghanistan at least.

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Didn't say that. Just saying Obama's numbers aren't going to look anything like Clinton's.

possibly not. maybe if he wins a 2nd term (and i don't see anyone taking it away from him anytime soon); things can look a lot better in 6 years than in 2. Presidents make a huge difference, but it's really the attitude of the American people that really matters, and i think Obama's failure to cultivate and galvanize a new attitude is probably his most significant. he's allowed Republicans and their tea bag stooges to dominate the debate and thus shape the attitude, and as a result people are rightly pessimistic after being handed fictional scenarios of doom and gloom for 2 years.

And while you can say it's unfair to blame Obama, one could say the same about giving credit to Clinton. After all he spent 6 of his 8 years with a Republican congress while he bent over backwards to make sure people saw him as a moderate. No to mention that he happened to fall into the internet boom.

Clinton did what all economically successful presidents do: create an environment for real growth by shoring up the foundations and pushing them outward a little*. he put a lot of people back to work, loosened some restrictions on businesses (which Republicans constantly clamour for and never give him credit for doing). sure he made the most of an internet boom, but Bush II was handed a big surplus as a result and turned it into the biggest deficit in our nation's history. Bush I was excellent on foreign policy, but his carryover from Reagan's horrible long-term agenda made him weak on domestic policy; Clinton, i'd argue, was the opposite. Bush II, obviously, was a disaster on both. Obama is going to need to be brilliant at both if we're to come out of the state we were left in.

And while I think Bush was a blithering fool of a president and I put a huge amount of blame on him, the mortgage crisis wasn't his doing.

it was his doing in that he was in full agreement with the policies that brought us the crisis and did absolutely nothing to alleviate them for 7 years. which is what you get when you elect a president (twice) who "isn't much of a reader".

*exactly the same sorts of things, incidentally, Obama has been trying to do.

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this is the only relevant thread, so i'll just make a brief observation:

Wall Street bonuses (not pay, just bonuses) for this season are the highest ever: around $144,000,000,000.00 ($144 billion).

that equates to roughly $450 for every man, woman and child in America. the proposed cost of rebuilding and updating the power grid for the entire United States, according to Scientific American, is about $60 billion. it's right around ($150 billion) what Obama is proposing to devote towards renewable energy over the next 10 years. $150 billion is also about what the Federal government will spend on education funding over this entire fiscal year for the entire country.

is there a single person who would argue that "redistributing" that wealth towards any one of these ends would not be better than it's current use? really?

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"fiscal responsibility":

SpinneyGraf.png

source.

I want to show this to every extremist democrat/republican who blames the other side for their problems...its pretty much a 50/50 split on presidents who were in the green by party. Both sides show that you can push debt burden (Reagan->Bush 1 or Kennedy->Nixon), even though the general trend is that Dems push the burden onto Reps (without taking the blame)...but nonetheless it seems to me that this is more of a reflection on the general state of the economy, and not on the president in power.

PS: Blackstar, you do realize Gomez is a troll, right? You'll never be able to get a cogent conversation that's on topic. He will always defer to the hallucinogen he took at a monastery in South America with a monk whose former life was being one of Shiva's arms.

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PS: Blackstar, you do realize Gomez is a troll, right? You'll never be able to get a cogent conversation that's on topic. He will always defer to the hallucinogen he took at a monastery in South America with a monk whose former life was being one of Shiva's arms.

l_a52d1e9da5fd4976bde756f1188b552f.jpg

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I want to show this to every extremist democrat/republican who blames the other side for their problems...its pretty much a 50/50 split on presidents who were in the green by party. Both sides show that you can push debt burden (Reagan->Bush 1 or Kennedy->Nixon), even though the general trend is that Dems push the burden onto Reps (without taking the blame)...but nonetheless it seems to me that this is more of a reflection on the general state of the economy, and not on the president in power.

PS: Blackstar, you do realize Gomez is a troll, right? You'll never be able to get a cogent conversation that's on topic. He will always defer to the hallucinogen he took at a monastery in South America with a monk whose former life was being one of Shiva's arms.

I guess I don't see what you're saying. All of the Democrats on that list were green, all of the red presidencies were Republican. You said that Democrats pushed debt onto their incoming Republicans, but it actually seems to be just the opposite if anything, with Bush I leaving a tremendous deficit for Clinton and Bush II leaving an even larger deficit for Obama.

Anyway, this arguing about parties is a moot point, because the parties were quite different in Eisenhower's time. A Republican back then would likely be a moderate today, that's how far right of center our political spectrum has shifted. Back in the 50s and 60s, conservatives were fiscal and social conservatives. Reagan's trickle down "piss on the poor" system ushered in a new era of social conservatism with fiscal irresponsibility.

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I guess I don't see what you're saying. All of the Democrats on that list were green, all of the red presidencies were Republican. You said that Democrats pushed debt onto their incoming Republicans, but it actually seems to be just the opposite if anything, with Bush I leaving a tremendous deficit for Clinton and Bush II leaving an even larger deficit for Obama.

Anyway, this arguing about parties is a moot point, because the parties were quite different in Eisenhower's time. A Republican back then would likely be a moderate today, that's how far right of center our political spectrum has shifted. Back in the 50s and 60s, conservatives were fiscal and social conservatives. Reagan's trickle down "piss on the poor" system ushered in a new era of social conservatism with fiscal irresponsibility.

I think you're reading the graph wrong...Clinton assumed less debt each year of his presidency...Bush I and Reagan assumed the huge debts from the Carter administration...and it was never reaalllyy that bad until after Kennedy.

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I think you're reading the graph wrong...Clinton assumed less debt each year of his presidency...Bush I and Reagan assumed the huge debts from the Carter administration...and it was never reaalllyy that bad until after Kennedy.

uh. not entirely sure what graph you're looking at. during Reagan's 8 years the debt went up each year by an average of 2.4%; during Bush I's subsequent term it went up by 2.75%. is your claim that it was Carter's policies that, 11 years after his administration, was causing this huge increase in the debt burden?

because even if we set aside all we know about Reagan's expenditures, that seems absurd on the face of it.

from the link, here's further explanation of the graph:

To be clear: the middle column is how much overall federal debt grew, or shrank, as a share of gross domestic product during each administration, and the right-hand column is the average annual rate of growth or reduction during that administration. As Spinney said in a note to me, "The idea of this column is simply to show the average annual change for the period covered in the first column -- so you can compare one term administrations to two term administrations in terms of their annual performance. The first row of the second column says, for example, that the average debt burden ratio declined by 4.7% during each year of the Truman administration."

the graph clearly shows the debt burden growing under Republican administrations since Nixon and shrinking under Democratic administrations; correspondingly showing some pretty extreme reversals in the Gross Federal Debt of the same pattern (shrinking under Democratic administrations and growing monumentally during Republican administrations). whatever one wants to make of those facts, your reading of the graph seems not just selective but hugely counter-intuitive.

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Been a while fellas.

Simply put, the government's debt and current budget deficits are NOT our biggest problem, and they don't deserve as much fanatical attention as they've been getting.

I think we should be careful when we discuss "the debt" and the "deficit" because as it stands, they are NOT that big of a problem compared to unemployment and weak economic growth. There's a strange amount of paranoia and fixation on government spending that is absolutely mindblowing when you look closely at the issue. I know this contradicts a lot of the deficit hysteria that people have in the media and among politicians, but I have never seen anything more absurd than the notion to cut government spending in the midst of a massive recession.

Blaming presidents past or present is neat, but we don't have to look too hard to understand why budget deficits are high:

Near term budget deficits are a consequence of the massive unemployment we have in this country, and the steps taken to address it.

-lack of employment means people are not paying taxes on income, which depresses revenue at the state and local level, as jobless people will generally spend money on simple survival goods and services

-massive increase in unemployment means more people on unemployment benefits, so we have state and federal governments spending more

-the rescue operations of the financial sector by Congress and the Fed had a big price tag

Long term budget deficits are a consequence of the yearly explosion in the cost of health care.

Over the next few decades, if health care costs continue to increase exponentially as they have, government budget deficits will explode upwards

The future health care cost driven debt explosion is two fold...if we are to assume health care costs will continue to skyrocket, THEN

-Government , as the largest purchaser of health care services via Medicare and Medicaid, will in turn have to spend exponentially more money

-Health care benefits, if they continue to go un-taxed, provide a massive tax loophole, billions in revenue remaining uncollected.

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this is the only relevant thread, so i'll just make a brief observation:

Wall Street bonuses (not pay, just bonuses) for this season are the highest ever: around $144,000,000,000.00 ($144 billion).

that equates to roughly $450 for every man, woman and child in America. the proposed cost of rebuilding and updating the power grid for the entire United States, according to Scientific American, is about $60 billion. it's right around ($150 billion) what Obama is proposing to devote towards renewable energy over the next 10 years. $150 billion is also about what the Federal government will spend on education funding over this entire fiscal year for the entire country.

is there a single person who would argue that "redistributing" that wealth towards any one of these ends would not be better than it's current use? really?

Well-put.

When we use terms like "wealth redistribution", I always wonder what kind of political-economic system "distribution" haters want, and what kind of economy they want.

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The United States debt is almost up to $14 Trillion. It goes up over $3 Billion every day. The federal governments estimated receipts for 2010 are $2.4 trillion so even if the federal government spent every dollar it made on the debt, it would take six years to pay it off.

Why is paying off the debt entirely important at all? What purpose does that serve compared to other goals? You need to review the history of the US and its national debt. (Hint: it's been higher than it is now as a share of overall GDP. This "14 trillion" number is completely meaningless without context of overall GDP.

I think I care more about the debt than the average American. It seems that the average American has a list of things they want the government to accomplish with no regard for how it impacts the debt and further inflation.

It's good to be concerned with the national debt and our current budget deficits. I think there's far more important things, like fixing unemployment. If you fix unemployment, you fix near-term budget deficits. If you fix the cost of health care, you fix long-term budget deficits.

These are the things I would cut: Defense, Social Security, change war on drugs to incarcerate less people, State, and other discretionary spending. Also, I would be against any further bailouts or large bills like Obama's reinvestment plan.

I'm with you on further bailouts of large idiotic financial institutions. I would have rather written-down or restructured the bad mortgages. Would've cost a lot less and would've done a lot more for the economy.

And as for cutting spending on Defense, Social Security, etc., how would that improve the economy? You should realize that getting out of debt and closing budget deficits in the long term are not accomplished only by cutting expenditures. Why would you cut defense and social security right now? You would only make the deficit even worse in the long run because you are eliminating jobs and economic activity, since, um, defense personnel would become unemployed and senior citizens will have to cut back on how much they spend. = lower consumption, lower aggregate demand for goods and services = even weaker economy = less federal revenue from income tax and lower state revenue from sales and income taxes = bigger budget deficit.

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And as for cutting spending on Defense, Social Security, etc., how would that improve the economy? You should realize that getting out of debt and closing budget deficits in the long term are not accomplished only by cutting expenditures. Why would you cut defense and social security right now? You would only make the deficit even worse in the long run because you are eliminating jobs and economic activity, since, um, defense personnel would become unemployed and senior citizens will have to cut back on how much they spend. = lower consumption, lower aggregate demand for goods and services = even weaker economy = less federal revenue from income tax and lower state revenue from sales and income taxes = bigger budget deficit.

The debt isn't an imaginary number that doesn't have real, negative impacts on the country. The debt hurts the value of the dollar, effects trade and effects our foreign policy. How we relate to China, India and those countries around them is impacted by our extremely high debt.

As for Social Security, it has to be restructured. Politicians have known this for years but have been too afraid to enact change. When Social Security began, the average life expectancy was 62 (I believe). Now it's about 15-20 years higher (don't have the numbers in front of me). Social Security benefits must decrease, retirement age must go up, and eventually people who give into the system need to be told that they won't be getting anything out of it later in life. I don't really see how anything I just said is negotiable. It's simply necessity and only a matter of time.

People like my father who have put in thousands upon thousands of dollars, but have been responsible and planned their own retirement, need to get hit with the hard truth and not receive as much as was expected.

As for defense spending, how we decide to spend money on defense shouldn't depend on how many jobs we want to keep around. Also, we can find ways to cut defense spending in ways that don't effect American based companies.

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The debt isn't an imaginary number that doesn't have real, negative impacts on the country. The debt hurts the value of the dollar, effects trade and effects our foreign policy. How we relate to China, India and those countries around them is impacted by our extremely high debt.

Since we've known each other a while and you're always open-minded, I'll push you further on this point. First, I don't agree with the idea that the debt hurts the value of the dollar. But let's just assume that's true. Let's assume that such a high debt causes the dollar to depreciate in relation to other currencies. That is good for American exports because our commodities are now more affordable in global markets. People who criticize China's economic policy often point to the fact that they keep the Chinese yuan artificially low (pegged at what, like 8 per dollar?) when it should probably be much higher than that. We are living with an overvalued dollar that should be allowed to come back to earth. You're not a Bill Clinton fan are you? It was Clinton's former Treasure Secretary Bob Rubin who helped create the trade deficit with China by encouraging the strong-dollar at a time when real wages in the US had been stagnant for decades.

But that aside, you have to demonstrate to me that the federal debt is a bigger problem than unemployment. I never said the debt is imaginary or without consequence, I said only that unemployment and weak economic growth are more important than the debt. If you fix unemployment and restore growth, near term, the near-term debt picture looks better. If you fix the cost of health care long-term, the national debt picture improves long term.

As for Social Security, it has to be restructured. Politicians have known this for years but have been too afraid to enact change. When Social Security began, the average life expectancy was 62 (I believe). Now it's about 15-20 years higher (don't have the numbers in front of me). Social Security benefits must decrease, retirement age must go up, and eventually people who give into the system need to be told that they won't be getting anything out of it later in life. I don't really see how anything I just said is negotiable. It's simply necessity and only a matter of time.

I think you're mis-informed. Social Security is fine and we don't have to make any substantial changes for about the next 20 years. There is no need to do any re-structuring. You need to show me what you base your beliefs on. There's a lot of mis-information out there spread by Democrats and Republicans about the health of social security. Benefits don't need to be lowered nor does the retirement age [edit] need to be raised.

People like my father who have put in thousands upon thousands of dollars, but have been responsible and planned their own retirement, need to get hit with the hard truth and not receive as much as was expected.

No, your dad and my dad are going to be ok so long as we don't subscribe to the misinformation of leading Dems and Repubs.

Even though I could use a dozen other links, for you, I like using Republicans to make my point. Even Michael Gerson, former George W. Bush speechwriter and policy advisor, undertands that Social Security is not as big a deficit driver and is in good shape compared to Medicare, in Tuesday's Washington Post op-ed:

Medicare is the main policy challenge here, because rising health costs are the primary cause of unsustainable entitlement commitments. But Medicare reform - the topic of intense, ideological debate - is a political nonstarter. While Social Security is a relatively small contributor to future deficits, reforming it would be a large symbol and a logical place to begin....The scheme begins to collapse in 2037, when promised benefits for Social Security recipients will suddenly drop by about 25 percent - unless the system is reformed.

See, there are smart Republicans after all who don't buy into the spin from idiotic Dems and Repubs. And you shouldn't either. Social Security is fine. And can modify gradually with minor cuts and fixes over a 26 year timeframe.

As for defense spending, how we decide to spend money on defense shouldn't depend on how many jobs we want to keep around. Also, we can find ways to cut defense spending in ways that don't effect American based companies.

The main point is that defense spending is not a major deficit or debt driver. Therefore to radically alter it now is fruitless. And I don't see any way you can cut defense spending in ways that don't harm American companies. General Dynamics. Northrop Grumman. Lockheed Martin. All American. You should tell me some examples. I'm open.

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The debt isn't an imaginary number that doesn't have real, negative impacts on the country.

i agree with this. notwithstanding the effect of catering to the owners of our debt on our foreign policy, we're actually spending (according to fellside's graph from Post #7) 4.6% of our entire yearly budget on interest for that debt; that's billions and billions of dollars being thrown out the window. yes, that shouldn't be our absolute #1 priority and obviously getting a handle on unemployment should be, but we can't lose sight of the fact that simply by virtue of having so high a debt we're losing huge amounts of money.

Social Security benefits must decrease, retirement age must go up, and eventually people who give into the system need to be told that they won't be getting anything out of it later in life. I don't really see how anything I just said is negotiable. It's simply necessity and only a matter of time.

don't necessarily agree with this, but Social Security's insolvency is a long-term (50+ year) problem rather than an immediate one anyway. incidentally, Obama's healthcare plan was centered around bringing healthcare costs down across the board, over time. i trust that you are a supporter of that program?

The main point is that defense spending is not a major deficit or debt driver. Therefore to radically alter it now is fruitless.

but it does account for immense amounts of unnecessary spending. paring down our defense spending by, say, 15% of it's current total could save $100,000,000,000. that's hardly insignificant money, no? surely you'd agree that the 2 biggest and most readily available sources of immediate revenue we could gain would be to raise taxes on the wealthiest and cut defense spending? which is what's so puzzling about the conservative emphasis on Social Security and Medicare as related to the debt: speaking purely monetarily, even if we got serious about paring them down tomorrow we wouldn't see the benefits on our fiscal spreadsheets for 20 years at least.

if anyone here hasn't tried the NYT's invaluable debt-solver widget, you really should. mine ended up being exactly 66% increase of taxes, 34% cuts to spending if that's any help as to where i'm coming from.

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Since we've known each other a while and you're always open-minded, I'll push you further on this point. First, I don't agree with the idea that the debt hurts the value of the dollar. But let's just assume that's true. Let's assume that such a high debt causes the dollar to depreciate in relation to other currencies. That is good for American exports because our commodities are now more affordable in global markets. People who criticize China's economic policy often point to the fact that they keep the Chinese yuan artificially low (pegged at what, like 8 per dollar?) when it should probably be much higher than that. We are living with an overvalued dollar that should be allowed to come back to earth. You're not a Bill Clinton fan are you? It was Clinton's former Treasure Secretary Bob Rubin who helped create the trade deficit with China by encouraging the strong-dollar at a time when real wages in the US had been stagnant for decades.

I'm not anti-Clinton. I think he was a very good president and it was one of the best examples of a conservative congress and liberal president using moderation as a means to get things done.

As for debt effecting the dollar, I don't know how to prove it (as I'm not an economist) but I simply thought this was a matter-of-fact thing. I could be wrong, but again I don't claim to be an expert.

As for China's economic policy, you do realize that they make very little profit? Yes they export more than anyone else, but their lack of profits hurt their infrastructure. The reason China's policy remains the same is because it is their only current means to stay afloat.

But that aside, you have to demonstrate to me that the federal debt is a bigger problem than unemployment. I never said the debt is imaginary or without consequence, I said only that unemployment and weak economic growth are more important than the debt. If you fix unemployment and restore growth, near term, the near-term debt picture looks better. If you fix the cost of health care long-term, the national debt picture improves long term.

If the debt has negative impacts on our economy (which seems logical) then the national debt will have long term negative impacts on unemployment in this country. Both are problems that have to be solved and I think being short-sighted is the very thing that got us into this debt mess.[

I think you're mis-informed. Social Security is fine and we don't have to make any substantial changes for about the next 20 years. There is no need to do any re-structuring. You need to show me what you base your beliefs on. There's a lot of mis-information out there spread by Democrats and Republicans about the health of social security. Benefits don't need to be lowered nor does the retirement age [edit] need to be raised.

How am I misinformed if the pool of those receiving benefits is constantly going up, people are beginning work much later in life, and the government is having to lose money every year to handle the problem?

The only way someone could say Social Security is fine is if they've become so used to solving our problems by throwing more money that we don't have at it.

No, your dad and my dad are going to be ok so long as we don't subscribe to the misinformation of leading Dems and Repubs.

I'm not saying that tomorrow the government will have to put in place the actions I mentioned, but it is true that someday they will. And barring some sort of catastrophe that reduces life expectancy in this country, the problem will get worse and worse.

The main point is that defense spending is not a major deficit or debt driver. Therefore to radically alter it now is fruitless. And I don't see any way you can cut defense spending in ways that don't harm American companies. General Dynamics. Northrop Grumman. Lockheed Martin. All American. You should tell me some examples. I'm open.

My Dad works for Lockheed Martin so I know a bit about how the government screws defense companies like it. The government is repeatedly making contracts with companies like Lockheed that are not upheld due to administration changes. The government wants 50 F-22's and then two years later they don't want any F-22's. The government wants a contract for a new fighter jet, but they don't want to pay for it, so they make other countries invest in it. When America pulls out, those countries are screwed because they can't carry the cost alone.

Anyway, it's a complicated issue but the government can actually help companies by Lockheed by not promising contracts that they won't uphold.

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