Economic Histrionics

Yesterday, I saw an article in the newspaper titled Bush Insists US Not in Recession. Why should he need to insist, I wondered. More to the point, why should his simple statement of an easily verifiable fact be characterized as insistence, which carries a connotation of defensiveness and denial?

A recession is defined as a decline in Gross Domestic Product for two or more successive quarters. According to the U.S. Department of Commerce, we haven’t had two successive quarters of decline in the GDP since 1991. The last time we had a decline for even one quarter was in 2001. Considering that we haven’t had a single quarter of decline in the GDP for the last six and a half years, it seems rather whimsical of the media to be declaring we’re in a recession, doesn’t it?

Earlier in the week, I read an article titled Survey Shows Economic Depression Likely. The article went on to say an opinion poll revealed that the majority of Americans think we’re headed for a depression. Oh, my. That certainly sounds scary. A depression is even worse than a recession! And, if the majority of Americans think it’s likely, then it must be, right? I mean, the majority of Americans can’t be wrong….

Then again, if you were to ask the majority of Americans what’s the definition of an economic depression, how many of them would know? Is asking a bunch of random people who don’t actually know what a depression means really the best way to determine if one is imminent? The definition of an economic depression is a decline  of over 10% in the GDP. The fact is, over the last four years of Bush’s presidency, we’ve seen an 11.8% increase in the GDP.

What? How can that be? With all this talk of economic disaster, is it possible that we’ve actually had the opposite of an economic depression? Something must be wrong with the data. After all, why would a majority of Americans believe we’re headed for a depression if it has no basis in fact? — Well, perhaps they believe it because that’s what they’ve been told by the media, over and over, for the past year. And now the very fact that they believe it is being sold to them as evidence that it’s true! 

So, how do you know whom to believe, the mainstream media or the data from the Department of Commerce?  Is it conceivable that all this talk of dire economic straits is hyperbole? Well, look around you. How many bread lines have you seen recently? But, if it is just media hype, why would they want us to believe that? In whose interest might it be to stir up fear and uncertainty in the population?  Whatever could be their motivation?

At the risk of sounding cynical, it is an election year. If the majority of Americans believe we’re headed for a depression, or that we’re in the middle of a recession and our president is lying to us about it, they might get pretty upset and worried and feel like we really need a change. (Seems I’ve been hearing that word a lot somewhere lately.) If Americans are living in fear of an imminent economic collapse, they’ll be all the more receptive to claims that it’s those evil capitalists, with their greed, warmongering, and tax breaks for the rich, that have gotten us into this mess. It only makes sense that we need to elect a Democrat to get us out of it.

Not only will the Democrats punish the large corporations for making too much profit, and end the war by heroically turning our backs on the terrorists and scurrying back home, they’ll raise the minimum wage and provide you with free healthcare, free lunches, and free whatever else they can convince you that you need (whether they can deliver it or not). Why would anybody believe that kind of unrealistic rhetoric? Because a lot of people want to believe it, and most people are more than ready to believe what they want to believe. The Democrats know that very well.

But first they have to convince the majority of Americans that times are bad. Times are very bad. — If the aforementioned survey is a reliable indicator, it looks like phase one is succeeding.

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Published in: on February 29, 2008 at 11:58 pm  Comments (6)  
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The Most Generous Nation in the World

For some reason, Americans have a reputation for being greedy. Perhaps it’s because so many people have been conditioned to associate capitalism with greed. The truth is, the United States is the most generous nation in the world. This chart shows the top ten countries ranked by private charitable contributions.

Charitable Aid Foundation

Arthur C. Brooks, Director of the NonProfit Studies Program at Syracuse University, conducted a study on charitable giving a couple of years ago, and published the following findings.

70 percent of Americans give to charity each year, and do so at far higher levels than people in other developed nations: three times as much as the British, four times as much as the French, and seven times as much as the Germans. …

Why are Americans so much more generous than our European counterparts, many of whom look down on us as being mercenary and crass? Do we give more just because we have more to give? That may be part of it. But the graph above ranks countries by giving, as a percentage of GDP, showing that Americans don’t just give more overall; we give proportionately more, relative to our income, than people in other countries.

In the same study cited above, Professor Brooks also researched relationships between how much individuals give to charity and their socio-political perspectives. Based on the results, he proposed a possible explanation for why Americans are more generous in our private charitable contributions than Europeans are.

Those who believe that government should redistribute income are far less likely to give voluntarily to help others. This helps explain why, compared to the United States, European states … see low levels of private giving.

Perhaps those who feel it’s the government’s role to help the needy don’t contribute as much privately because they believe the government has it covered. Presumably, they figure they’re already contributing through taxes, so it isn’t necessary to donate privately as well. Yet, in this country, the people who believe the government spends too much on social welfare programs pay the same amount of taxes, but still feel impelled to give more of their own private resources to help those who are truly in need.

In 1996, the General Social Survey asked a large sample of Americans whether they agreed that, “The government has a responsibility to reduce income inequality.” Those who “disagreed strongly” with this statement gave an amazing twelve times more money to charity per year, on average, than those who “agreed strongly.”
Arthur C. Brooks

This raises the question of whether those who think it’s up to the government to take care of the poor would be inclined to contribute more to humanitarian causes if the government were not assuming that role. If they paid less in taxes, would they donate proportionately more to charities? If so, we might be able to do a better job of helping the truly needy by eliminating government welfare programs and reducing taxes.

Private charities tend to be more efficient than government programs. (See Feeding the Needy or Bolstering the Bureaucracy.) Given the same amount of money, it’s likely that private charities could address the problem more effectively than the government does. If the government were to get out of the charity business, perhaps the folks who think we’re not doing enough would contribute more of their own time and money, instead of always crusading for higher taxes.

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Published in: on February 27, 2008 at 11:57 pm  Comments (30)  
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Terror, Poverty, and the Willfully Naive

Certain enlightened people keep trying to convince me that we can only solve the problem of terrorism by humanitarian, rather than military, efforts. After all, the jihadists wouldn’t be able to recruit terrorists if those people weren’t so poor and desperate. So, perhaps, if we really want to end this war, we should cut our entire military budget and give all that money to the Arab nations, in the hopes that it will raise their collective standard of living and make them all love us.

Unfortunately, no matter how much money we might shower upon them, it’s hard to see how it would raise the average standard of living of their populations. The countries we’re talking about are not particularly poor, though the vast majority of their citizens are. (How does one come up with a way to blame the U.S. for that?)  No matter how much foreign aid we might bestow on these oil-rich countries, why would  their governments redistribute our wealth any more beneficently than they redistribute their own?

Even if it were possible for us to raise their standard of living, what evidence is there that they would no longer hate us? My personal experience with people collecting entitlements is that they don’t feel any great love for the middle and upper classes whose taxes subsidize them. (If you imagine they do, try taking field trip to your nearest ghetto and take a survey on how grateful they feel.) People who receive benefits without providing anything in return grow to feel entitled to those benefits, and soon start feeling resentful that they aren’t getting enough — because the ones giving it to them still live much better than they do. Obviously, the money is owed to them. Otherwise, why would they be getting it? Once the war was “over,” we’d have to keep on paying forever, to sustain whatever standard we set, or risk their hatred and reprisal for withdrawing it.

As warm and fuzzy a fantasy as it may be, it isn’t realistic to assume that we can buy the hearts and minds of all the people in the world by altruistically showering our money on them. Especially when some of those people have a history of using the money we’ve given them to launch deadly attacks against us. Blindly trusting people who have proven they cannot be trusted doesn’t make them trustworthy. And using our defense budget to arm our enemies somehow just doesn’t seem wise.

The ideal world imagined by the willfully naive is not grounded in reality. The poverty argument is a red herring. This war is not about poverty. It’s about terrorism. Islamic terrorism is not about poverty. It’s about extremist ideologies. No amount of redistribution of wealth is going to address that issue.

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Published in: on February 23, 2008 at 11:18 pm  Comments (25)  
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Eating the Rich

The most recent report from the Congressional Budget Office on Effective Federal Tax Rates is based on statistics from 2005. I found the report very enlightening.

  • Of the total individual income taxes collected that year, 99.4% were paid by the highest earning 40% of American households. That means 60% of the population paid less than 1% of the total taxes.
  • The lower 40% of households, on average, got more money back (through tax credits, EIC, etc.) than they paid in. This segment included people earning up to $48,000 per year. 
  • The top 20% of earners paid 86.7% of the total taxes collected, with the top 10% shouldering 72.7% of the total tax burden for the entire country.

Given this objective historical data, would somebody please explain to me the theory that the rich are undertaxed?

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Published in: on February 21, 2008 at 11:37 pm  Comments (15)  
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Pandora, Peter Pan, & the Pied Piper

According to Greek mythology, Pandora was the first woman on earth. She was not created as a blessing to man, however, but as a curse. She was beautiful, talented, and charming. At her wedding, Zeus presented her with an exquisite box, with the strict warning that under no circumstances was she ever to open it. She and her husband were very happy, but she was constantly tormented with curiosity about what was in that box. She had promised never to open it, but her curiosity grew and grew. One day, when she was alone, she decided it couldn’t hurt to just peek inside the box. Who would ever know?

So she very carefully raised the lid just enough to peer in — WHAM!!! The lid burst open and a swarm of hideous creatures flew out, and every evil and vileness was unleashed upon the world. She slammed the lid shut, but it was too late. The damage was done. Then a plaintive voice cried out from within the box, whining and begging to be let out. Pandora knew she shouldn’t open it again but, in her womanly weakness, she took pity on the pathetic creature, figuring what difference would it make to let out one more after all the others had already escaped? — especially since it sounded so harmless… So she lifted the lid and let it out. Little did she know, this was the most insidious evil of all — Hope.

Hope is cheap. Hope is easy to conjure up, because people want to believe in it. Hope makes people feel good when things are going from bad to worse. Hope is the tool used by confidence men to dupe people out of their savings, and by false prophets to manipulate the gullible. Even when wielded with the best of intentions, hope is a poor substitute for competence, experience, and a firm grasp of reality. When your boss asks if you can meet an important deadline, does he want to hear you say you hope so? When you take your car in to a mechanic, and ask if he can fix it, do you want to hear him say he hopes so?

Hope is merely wishful thinking. I want more than that from the leader of our nation and the Commander in Chief of the world’s most powerful military. We’re facing threats from terrorist nations who are developing nuclear weapons technology, our borders are eroding, our social security system is going bankrupt, and our national debt is approaching 14 digits. Is hope going to cure that?

Hope is nice. Hope is sweet. But hope is not enough to run a country on. Obama is Peter Pan and the Pied Piper all rolled into one. What America needs a tough leader with a track record, judgment, fortitude, and a keen understanding of economics. We don’t need catchy slogans about hoping for change we can believe in. We need a leader who can deal with reality.

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Published in: on February 20, 2008 at 11:03 pm  Comments (17)  
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Sunni and Shiite Unite Against the West

If you’re one of those who is absolutely convinced that there could never be any connection or collaboration between the various Islamic terrorist organizations, because Sunnis and Shiites hate each other, you need to read this article, Death by Car Bomb in Damascus. (I’ve included excerpts below, but there’s much more information in the original article.)

They may hate each other, but not as much as they hate us. Historical evidence shows clearly that, whatever ill will the rank and file Sunnis and Shiites harbor toward one another, their radical leaders are more than willing to set aside sectarian differences to unite in a common effort to destroy the West.

Imad Mugniyah is the top-ranking Hezbollah terrorist leader who was killed last week in a car bomb in Damascus. We all know who Osama bin Laden is.

Imad Mugniyah’s relationship with Osama bin Laden began in the early 1990s, when al Qaeda’s CEO was living in Sudan. Bin Laden’s benefactor at the time was a charismatic Sunni Islamist ideologue named Hassan al-Turabi. …

The differences between Sunnis and Shiites were not insurmountable in Turabi’s eyes; on multiple occasions he dismissed the importance of any theological disagreements. Instead, Turabi envisioned a grand, Manichean clash of civilizations in which the Muslim world stood united against its common Western foes, especially America. In a few short years, Turabi’s Sudan became a hub for international terrorists of all stripes. …

Bin Laden agreed with the Iranian assessment that the enemies of the West should come together. …

The Clinton administration recognized that an alliance between Iran, Hezbollah, and al Qaeda had blossomed in Sudan. In its 1998 indictment of al Qaeda, Clinton administration prosecutors charged that al Qaeda had “forged alliances with the National Islamic Front in the Sudan and with representatives of the government of Iran, and its associated terrorist group Hezbollah, for the purpose of working together against their perceived common enemies in the West, particularly the United States.” …

That the two men met was made clear by Ali Mohamed, a top al Qaeda operative in the early 1990s, who testified at the embassy bombings trial that he had arranged a sit-down in Sudan between the aspiring jihadist bin Laden and Mugniyah. Mohamed explained:

“I was aware of certain contacts between al Qaeda and [Ayman al-Zawahiri’s Egyptian Islamic Jihad] organization, on one side, and Iran and Hezbollah on the other side. I arranged security for a meeting in the Sudan between Mugniyah, Hezbollah’s chief, and bin Laden.”

According to Mohamed, bin Laden was interested in forcing American troops out of Saudi Arabia the same way Mugniyah had forced them out of Lebanon. Mohamed said that Mugniyah agreed to help:

“Hezbollah provided explosives training for al Qaeda and [Egyptian Islamic Jihad]. …”

The type of training described by Mohamed took place not only in Sudan, where hundreds of Iran’s Revolutionary Guards and Hezbollah operatives had built terrorist training camps, but also in Lebanon and Iran. The 9/11 Commission reported that “senior al Qaeda operatives and trainers traveled to Iran to receive training in explosives.” Then, “in the fall of 1993, another such delegation went to the Bekaa Valley in Lebanon for further training in explosives as well as in intelligence and security.” …

[Former Al Qaeda opertive] Jamal al Fadl also told U.S. prosecutors that he had talked to one of his fellow al Qaeda terrorists about his training in Lebanon. Al Fadl said he was told the “training is very good” and his colleague brought “some tapes with him.” Al Fadl elaborated: “I saw one of the tapes, and he tell me they train about how to explosives big buildings [sic].” Al Fadl went on to list the names of some of those who received Hezbollah’s training. Saif al-Adel, who was promoted to the third-highest position inside al Qaeda shortly after the September 11 attacks, was among them.
Death by Car Bomb in Damascus, Weekly Standard

The information in this article is a matter of public record, and comes from the 9/11 Commission report and from testimony by Al Qaeda operatives in the 1998 trial for the embassy bombings in Kenya and Tanzania. If, after being exposed to the historical evidence, you still don’t believe in an international network of Islamic terrorist organizations working together to defeat the West, I can only conclude that you have your own reasons for preferring not to believe it.

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Published in: on February 18, 2008 at 10:07 pm  Comments (8)  
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Immigration and Natural Selection

This video is 9.5 minutes long, but it’s well worth watching. It provides a graphic demonstration of the impact of current immigration policies on our country’s future, from a perspective of resource utilization.

Being a strong proponent of free market solutions, I used to believe the best approach to immigration was to grant anybody citizenship who could pass the necessary background checks. A number of people I respect challenged the wisdom and practicality of that approach. Initially seeking to justify my position, I set out to research the matter, which led me to reevaluate some long held assumptions. Ultimately, the data convinced me that my solution was not practical and that, in fact, we need tighter immigration controls.

I’m not against immigration. Many of the most compelling scientific, industrial, and technological innovations of the 20th century were discovered or invented by immigrants from other places. A lot of people employed in our scientific and high-tech industries are here on work visas and green cards, working their way through the citizenship process. Research and development companies hire many people from other parts of the world, and relocate them here at signficant expense, because the industries are growing so fast there aren’t enough highly qualified Americans to fill the positions. These people obey our laws, respect the principles that form the foundation of our nation, have a strong work ethic, and contribute not only to our economy, but to our world leadership in numerous scientific and technical fields. They are an asset to our nation. We should welcome them and make it easier for them to become citizens.

On the other hand, we can’t afford to thow open our doors to everybody who would like to live here. The reality is, there are a limited number of immigrants our nation can successfully absorb per year. There are a virtually unlimited number of people, particularly in third world countries, who would like to come here if they could. We have no choice but to be selective in our immigration policies.

The question is what selection criteria do we apply? American citizenship is not an entitlement that’s owed to everybody who demands it. As this video graphically demonstrates, it’s a limited and precious commodity. Therefore, by the law of supply and demand, competition will always be high. That’s not necessarily a bad thing. In nature, it’s competition that improves the fitness of a species by selecting the strong over the weak. Allowing the same principle to drive our immigration policies can, likewise, improve the overall “fitness” of our nation’s population.

I do not favor any selection policies based on ethnicity or national origin. Just like applicants for a job or a university, the criteria should be based purely on competitive qualifications. For every applicant to whom we grant citizenship, some other applicant will have to be denied. If we follow the counsel of nature, we will select those who have the highest probability of successful assimilation and contribution to our nation. Some will say that’s elitist and unfair. So is natural selection, but it works.

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Published in: on February 17, 2008 at 7:32 pm  Comments (4)  
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America Sucks

It baffles me why so many Americans readily accept that, in any conflict with foreign interests, America must be at fault. To these people, all of our enemies are actually our victims, and are justified in hating us because America’s a big bully. They seem to believe the rest of the world is full of peaceful, good-natured people and, if the terrorists want to destroy us, it must be because we’ve done them wrong. If those who have declared us their enemies commit inconceivably vicious acts of barbaric violence, it’s only out of desperation because we have somehow driven them to it.

Those who want to believe in our culpability insist that the attacks on (and prior to) 9/11 were only retribution for our “meddling” in the Middle East. The flaw in that reasoning is that, if you look at the history of the Islamic extremists, they do not only attack those who “interfere” with them. They have an impressive track record, throughout the world, of ruthlessly attacking and oppressing those who don’t buy into their ideology. But it’s convenient to ignore that historical perspective if it runs counter to one’s agenda. On the other hand, perhaps all the nations and peoples against whom they’ve committed brutal acts of violence and terrorism are somehow also responsible, and only the terrorists are victims.

The people whose agenda it suits to blame America refuse to consider the possibility that the terrorists might actually hate us for the reasons they claim to hate us. — Because we are the great Satan, and they see our culture as an abomination to Allah. Their law requires victims of rape to be stoned and beaten. They torture and execute homosexuals. They arrest and imprison women for showing their faces, arms, or ankles in public, or for talking to any man to whom they are not related. They execute people for speaking out against their government. In a culture where these affronts to human liberty are strictly enforced by law, why is it so hard to conceive that they find our culture, with all the freedoms we cherish, to be an abomination? Until and unless we’re willing to give up the inalienable rights that we hold to be self-evident, and submit to Shari’a, we will continue to offend.

Sometimes I wonder if the people who hold on so tightly to these romantic notions of our enemies have ever been outside of this country. They seem to assume the rest of the world enjoys the same fundamental rights and freedoms we take for granted here. They seem to assume that everything bad they hear about our enemies is just political rhetoric, and that those governments are really no worse than ours. (In fact, they seem to assume ours is the worst.) This is not just naivete, but willfull naivete.

I’d like to ask those people who really think we’re the bad guys the following questions. 

  • Do you believe they don’t really treat women as property, and punish them for crimes committed against them, or do you believe that’s ok?
  • Do you believe they don’t really torture and kill homosexuals for offending Allah, or do you believe that’s ok?
  • Do you believe they don’t really execute people for being critical of their government, or do you believe that’s ok?
  • Do you believe they don’t really fund and train terrorists to blow up international civilian targets, or do you believe that’s ok?

I’m just curious, do you not believe these things really happen, or do you not believe they’re evil? Or do you believe that they happen, and that they’re evil, but that we are somehow worse than they are?

There really are bad guys out there in the world. And the Jihadists really are bad guys. They are not innocent victims of America’s rapacious hegemony. Nevertheless, people will believe what they want to believe. But why they want to believe that America is always the villain is truly an enigma to me.

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Published in: on February 16, 2008 at 2:23 pm  Comments (59)  
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Campaign Slogan for McCain


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Published in: on February 14, 2008 at 7:28 pm  Comments (3)  

Are We Really at War?

Some people keep insisting that the war on terrorism isn’t a real war, because you can only be at war with a country, and “terrorism” isn’t a country. The problem is, a worldwide network of well-organized and well-funded terrorists has declared war on us.  When someone declares war on you, and demonstrates the ability to effectively attack you on your own soil, killing thousands of civilians and attacking the Pentagon, you are at war with them whether you call it a war or not. It’s pointless to say “they aren’t a country so we can’t be at war with them,” when they’re clearly at war with us.

There’s a significant difference between the war on terrorism and any previous wars we’ve fought. But that doesn’t mean it isn’t a war. We’re at war with an international network of radical Islamic terrorists. The fact that the enemy isn’t one sovereign nation makes this war extremely difficult to prosecute, because it’s literally a war without borders. But does that mean we should give up and go home?

Their leaders have declared that they will not stop until they’ve succeeded in annihilating our culture. Because they’re fanatics, I believe them. These are not rational people. They believe they will defeat us. If they perceive that we’re too weak to continue the battle, it will give them strength to pursue it more vigorously.

There are radical Islamic fundamentalists just about everywhere in the world. Wherever they are, they’re a potential or actual threat, not just to us, but to anybody they deem is an infidel. We need to stop them, both because there’s no other nation on earth powerful enough to do it, and because we are, have been, and will be again, targets of their terrorist activity.

The people who say we should have stayed in Afghanistan because that’s where Bin Laden was before 9/11, or that we should focus on Pakistan because he’s probably there now, don’t understand that Osama bin Laden is not the enemy. He’s only one leader in a vast network of terrorist cells, spead throughout the world. You can’t kill the Hydra by chopping off its heads; you have to disembowel it. That means cutting of its source of funding. Iran, Syria, and Saudi Arabia are the biggest sources of funding for Islamic terrorism. (Saudi Arabia is ostensibly our “ally,” so they will undoubtedly be the last one with which we engage, if it should come to that…)

IMHO, this war will ultimately be fought in every country that harbors or funds terrorists, because it’s a war on terrorism, not on a particular country. The countries that fund terrorism, and the countries where the terrorists organize, plot, stage, and train their operatives, will either fight with us or against us. If they commit to eradicating the terrorists within their borders, we will fight alongside them. If they side with the terrorists, we will fight against them.

Withdrawing our troops now, as the Democrats want to do, would leave the spoils to the enemy, and give them a chance to regroup and grow stronger. And they will attack us again.  I’d rather the war be fought over there by trained soldiers who volunteered to fight for their country than have it come here and be fought by suicide bombers against civilian targets.

Do you remember 9/11? Do you remember how you felt inside when you first learned what had happened? Or has it been glazed over by the media bombarding you with the same images over and over until you were finally inured to the reality of it, and it became just another media event? It was real. And it can happen again. And again. And again, and again. And, if you don’t believe me, ask an Israeli what it’s like to never know from day to day if the bus you take downtown, or the pizza shop your kid stops in with their friends after school, is going to be blown up by terrorists. Do you think it can’t happen here? Don’t forget, it already has.

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Published in: on February 12, 2008 at 11:56 pm  Comments (30)  
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