Hubris

by Russ Roberts on March 23, 2009

in Politics

The AP reports:

"I realize there are those who say these plans are too ambitious to
enact," Obama said in his weekly video and Internet message. "To that I
say that the challenges we face are too large to ignore. I didn't come
here to pass on our problems to the next president or the next
generation. I came here to solve them."

As I think Thomas Sowell said, economics teaches us that there are no solutions, only tradeoffs.

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  • yetanotherdave

    Daniel, I expected that question, and if I was certain I would have included the country name in my first post. I think it was Hungary or Yugoslavia (or at least one near there). Sorry for the non-specific answer.


    Also, please note I'm not defending or promoting sloppy (or inflammatory) use of language. I'm just relating the comments I've heard from the only person I know with direct personal experience. Given what she's told me the term does seem to fit, at least from an early warning point of view.

  • John

    Daniel,

    I think of socialism as a system of involuntary charity.


    In the name of the greater good we are forced to fund programs in which we may or may not be eligible to participate.


    Does that fall into any textbook definition? I doubt it.


    But I bet it would describe what many people think of when they use that particular word.


  • Babinich

    Daniel Kuehn on 03/23/09 @ 12:41:59 PM


    "If a real socialist had a real chance at getting any power in this country, I'd probably be more adamantly ringing the alarm bell. As it stands, I'm pretty comfortable with having a civil discussion with a socialist. Not many socialists at the table to talk with right now, though."


    Dan, it's not you that I am worried about. It is all the other gimme, gimme, gimme, types that seem to soak up the message of "Change".

  • Daniel Kuehn

    yet another Dave -

    Which socialist country, may I ask?

  • Daniel Kuehn

    John - please read my reply to Sam. I'm not advocating a strict dictionary definition. I'm just advocating a little coherence.


    Babinich -

    I'd agree with you on what socialism stands opposed to. But socialists strike me more as woefully mislead than they do as boogey men (and I admit - a lot of my unwillingness to treat them like boogey men is due to their reduced threat since the Cold War. I would probably approach it somewhat differently in the 60s or 70s).


    If a real socialist had a real chance at getting any power in this country, I'd probably be more adamantly ringing the alarm bell. As it stands, I'm pretty comfortable with having a civil discussion with a socialist. Not many socialists at the table to talk with right now, though.

  • yetanotherdave

    Maybe Daniel has a point about the semantic issues surrounding the word socialist. But, the only person I know who escaped from a socialist country told me that what is happening in the US is exactly how the transition to socialism started there. Naturally, she is very concerned. Having heard her informed viewpoint, it seems reasonable to use the term socialism to describe what's going on here now.

  • Randy

    Socialism; Any system of thought in which the needs of "society", as expounded by those claiming to speak in the name of "society", are given priority over the rights of individuals. Modern variants include Socialism, Democratic Socialism, Communism, Fascism, and Progressivism.


    P.S. If you don't want me to call you a socialist, then all you have to do is make your programs voluntary.

  • Daniel Kuehn

    He does address coverage issues - I don't think he exclusively addresses them.


    One thing that helped me decide between Obama and Hillary in the primary was that Obama seemed much more aware of and concerned with both cost and coverage. Hillary's plan was far closer to a single payer system with much more subsidized care for low income people. I think expanding government coverage somewhat would be appropriate, but that doesn't seem to be the crux of Obama's plan.


    McCain also demonstrated concern with costs, although he didn't talk about it as much. But I thought his plan to reduce the tax break on employer health benefits made a lot of sense. If benefits were taxed like wages, and then the new revenue allowed for a reduction of rates in all brackets, that would go a long way towards tamping down the rapid growth of national health expenditures, and make the employer system more equitable (currently there is more incentive to provide compensation in the form of health benefits for high income workers than there is for low income workers, because the tax break of that move is much greater for high income workers).

  • Babinich

    "Why does this have to be so vicious?"


    Because a great deal is at stake.


    "Why does socialism have to be built up into a boogey man?"


    Because socialism stands opposed to life, liberty, and the pursuit of happiness.

  • JP

    What was the trade-off for smallpox eradication?


    The costs associated with eradication meant that there was that much less to spend on other needs. (I.e., opportunity costs.)

  • Daniel Kuehn

    I would agree that the partisanship also degrades the debate. As a self-proclaimed moderate, it's amazing the flack that I've received from both sides. After the last eight years I'd probably say I'm more "center left" than "center right" - but who knows. Give me eight years of Obama and I might be "center right".


    Nevertheless - I'm not trying to adhere strictly to technical definitions of socialism and communism. But I'd at least like to see some resemblance. If you think Tim Geithner, Paul Volcker, Larry Summers, and Christie Romer are really orchestrating socialist policies, fine. You are going to have a really really hard time convincing me of that.


    Clearly there is some variety in socialism. The Europeans have proved that you can have socialism without an iron curtain and egregious repression. But even the most liberal suggestions of the Obama administration bear no resemblance to European socialists (and European socialists certainly don't fit the dictionary definition of "socialism" or "communism" anyway).

  • John

    I see. One may not use the word Socialist unless it is directed at a person who agrees and practices 100% of the dictionary definition of Socialism, down to the last letter.

    Wow, I guess we'd better quit using adjectives in political discourse, since nobody fits any definition perfectly.

  • You may need to be a little more precise about what exactly you think the Obama health plan is.


    Regardless of what "solution" they come up with, the very fact that it is an "Obama health plan", shows a collective approach, using collectivized resources, via the collective agency of government.


    It is apparent to me that the symptoms are viewed as "the problem".

  • MY definition of socialism would be useless?


    No, the term would be useless.


    As pure communists discovered, the pure state of communism (and socialism) cannot be attained. I say it's because they require the concentration of political power in collective agency to effect their gaols. Such agency is always political and oligarchical, and as such must always reflect a compromise between the various agencies comprising the oligarchy and with reality.


    Hence, it discussing real world issues, labels such as communism and socialism are not useful if they must be confined to their technical definitions.


    It is the preference of some to use these terms in a more general sense, to indicate that some policy is socialistic.


    If you can't bear it, then perhaps you can provide better labels.


    How about "collectivist"? or maybe "statist"?


    Populist might be used, but that one is pretty fluid.


    I suggest that the discussion is already degraded, but not by misuse of terms such as socialist, but rather by the blatant partisanship of many contenders and the meme of the right/left political spectrum which has a fairly antique history.


    Those on the left assume that if you disagree with them, then you must be on the right side of the spectrum and vice versa.


    In 1976, the National Review published an article exposing the Libertarian Party as communist. At the same time, many leftists criticized libertarians as right wingers.


    The political debate is founded at the bottom.

  • Daniel Kuehn

    No John - don't be so sensitive. I'm happy to have an exchange on what the most useful definition of the word is.


    But - I think the more unrelated things that fall under the umbrella of the word "socialism", the less meaningful the word is. When I say "meaningful" I literally mean how much meaning it communicates.


    I see very little reason to lump people who think there is a role for government in the economy with people who have a total collectivist vision for the role of government. As for government control of AIG - again, your statement proves my point. Yes we own 80% of AIG. But if you can't honestly distinguish between the circumstances of that nationalization and the circumstances of, say, Chavez's nationalization of oil companies, then I think that's a big problem. Why did they do it? How many other companies do they have that high of a stake in? Is it likely that they'll still own 80% of AIG five years from now?


    These are all very relevant questions, and if you took some time to think them through you'd realize that it makes sense not to call that socialism. Does that mean you can't criticize it? Of course not! There may be lots wrong with owning 80% of AIG. One thing that isn't wrong with it is that it is some version of socialism.


    There are very, very, very, very few socialists in the U.S.. The ones that are here don't have that much power (at least political power... perhaps in Hollywood or the university they do). Generally speaking, I don't find "socialism" to be a very useful word to use in policy discussions. I'm sure some exceptions will come up, but as a rule of thumb I think it makes sense to assume "socialism" is a complete non sequitor.

  • John

    I see the word "meaningful" in there.

    Very nice. Now the definitions of Socialism that matter are determined by you, and all others are meaningless?


    Saying that socialism is a philosophy in which government force is used to promote "economic justice" wouldn't be meaningful, because that's what is happening.

    Socialism as a system where industry is owned and controlled by government must also be a meaningless definition, since the government owns 80% of AIG.


    If by "meaningful" you mean central planning with the government controlling all production and distribution, then I'd have to agree that Obama is not a Socialist.

  • Daniel Kuehn

    John -

    I meant we're in agreement that what we're concerned with is what Obama does.


    It's not that he doesn't fit into the precise dictionary definition. It's that neither his actions nor his beliefs bear any resemblance to any meaningful definition socialism.

  • Mr. Econotarian

    I remember when the only huge debt we were passing on to our kids was unfunded future costs of Social Security and Medicare...

  • Daniel Kuehn

    Sam -

    No, you weren't. Nicole was talking about what he was thinking about the issue. That was a response to her, not you.


    Collective problem resolved through collective action? I'm not sure what you mean. You may need to be a little more precise about what exactly you think the Obama health plan is. And honestly, I don't think they know exactly yet - my understanding is they're still working it out.


  • Daniel Kuehn

    Sam -

    Wait a minute, MY definition of socialism would be useless? Defining every attempt at government intervention as "socialist" is what's dumbing down our public discourse right now. People aren't talking about real options - they're fighting out imaginery ideological battles.


    I know genuine socialists have made attempts to be more palatable. But even those "linguistically reformed" socialists offer programs that are radically different from what the Obama administration is offering.


    vidyohs uses the term as a catch-all. How in the world is that more useful than using it more specifically? How is lumping Tim Geithner and Bernie Sanders useful for anyone?????

  • Greg Ransom

    Harry Frankfurt taught us why most people in public life are bullshitters:


    Harry Frankfurt, "On Bullshit":


    http://www.gwinnettdailyonline.com/articleB5BD6D4417AF444DBD8F9770AA729B26.asp

  • the flip side of the "they'll get the bill" is that if we do nothing and health care remains as expensive as it is today, they'll get the bill for that too.


    Of course, the cost of government spending, indeed of all spending, will always be borne by those who labor to create value.


    But they aren't questioning why health care is expensive to find the roots of the problem, they assume that the problem is that people can't afford it, so the solution is to make the wealthier pay for the health consumption of the poorer.


    The shortcoming of this is that the expense of health care will not be relieved and the costs of all spending will always be borne by those who labor to create value.


    So tell me, why is health care unaffordably expensive for so many people that it is viewed as a collective problem to be resolved through collective action?

  • Superheater

    "Let's be honest - your political allies and your political opponents probably all recognize that everything is a tradeoff. Do them the charity of assuming that. "


    This is kind of amusing considering the left has never practiced any sort of "charity" toward their opponents.


    I saw Mr. Obama is entitled to the same presumptions about his motives, competence and character as Mr. Bush and Mr. Reagan received.


    The left passed a bill the other day that provides for a uniformed paramilitary youth organization-CAN YOU IMAGINE how that would have been treated if it wasn't being done by the left?





  • All I'm saying is that you can't look at the situation, see that Obama's program is expensive, and ASSUME he's not personally interested in relieving the burden on the future.


    I wasn't referring to Obama's intentions.


    As I see it, a failing of modern liberals is that they seem to believe that results automatically spring from intentions.


    They have good intentions, therefore their actions will produce good results, and if good result aren't achieved, then the blame will be placed on those with bad intentions; those who oppose their well intentioned actions.

  • John

    Daniel,

    Agreement? I'm haven't figured out where you stand so I'm not quite sure.


    It seems to me that your argument is a matter of semantics, that Obama isn't a Socialist because what he's doing doesn't fit the dictionary definition of Socialism.



  • Daniel Kuehn

    btw - I am a fan of the spending for the stimulus, but am much more wary about the other spending that's going on - and I'm very troubled by the new CBO numbers. I've said on earlier posts that I'm a deficit hawk of sorts - sort of a moderate Democrat. So I'm not afraid of large budgets, or even deficit spending - but it has to be worthwhile. Countercyclical fiscal policy seems quite sensible, and I don't mind paying that debt off in the future. Continuing to run deficits worries me very much. We don't have a great health care system, but we're not a third world country either. I'd be willing to take it slow and pay off some of our debt first.


    However, I wouldn't make the automatic assumption that an increased level of spending is necessarily bad.

  • Daniel Kuehn

    btw - I am a fan of the spending for the stimulus, but am much more wary about the other spending that's going on - and I'm very troubled by the new CBO numbers. I've said on earlier posts that I'm a deficit hawk of sorts - sort of a moderate Democrat. So I'm not afraid of large budgets, or even deficit spending - but it has to be worthwhile. Countercyclical fiscal policy seems quite sensible, and I don't mind paying that debt off in the future. Continuing to run deficits worries me very much. We don't have a great health care system, but we're not a third world country either. I'd be willing to take it slow and pay off some of our debt first.


    However, I wouldn't make the automatic assumption that an increased level of spending is necessarily bad.

  • They just got the wrong answer.


    A faulty answer after a sequence of sound reasoning can be ascribed to faulty premises.


    BTW, vidyohs is not using socialism in the technical sense. There wouldn't be much to discuss in that case. His usage of it refers to the impact that formal socialism (from the 1930s) has had on the U.S. political trajectory.


    And it has had its impact. It was for a long time very popular among the intellectual community, and has affected much discourse on policy issues.


    Using the term socialism as you require would render it a fairly useless term, since most people with any awareness aren't interested in going there.


    It has been observed that many socialists, recognizing the disfavor with which Socialism is viewed, have removed the word from their lexicon and use attractive sounding substitutes.


    When vidyohs uses the term I understand that he is referring to the idea of government acting as a sincere collective agency on behalf of the people and the desire of people to use government to manage the economy and equalize wealth distribution (based on class envy) has many roots in Socialist dialog.


    He also uses the term in a pejorative sense.

  • Daniel Kuehn

    nicole and sam -

    well of course - some people may feel that the burden of the increased taxes required for the increased activity is a net burden. some people will think that not doing the reform and not paying those taxes is a net burden. I'm no health reform or education expert, so I couldn't tell you which is right. All I'm saying is that you can't look at the situation, see that Obama's program is expensive, and ASSUME he's not personally interested in relieving the burden on the future.


    and same - the flip side of the "they'll get the bill" is that if we do nothing and health care remains as expensive as it is today, they'll get the bill for that too. Those kinds of comments don't provide any answers. What we need is a consideration of the tradeoffs involved in each program - and an evaluation of what is best. You can't a priori assume that having a program that costs money is a net burden.

  • Daniel Kuehn

    John -

    I guess we're in agreement then?!?!? I'm concerned with what Obama does as well.

  • Daniel makes a good point:


    Socialists are PURELY rational. They use nothing but reason.


    It's the premises one has to internalize before applying that reason that I can't digest. Once can be completely rational within the bounds of a fairy-tale land where unicorns and rainbows mean freedom for all, and free riders never subvert the system.

  • John

    I think the Socialist argument is vicious because each side is offended by the other.

    Those who support Socialism see anyone with more "stuff" than them as somehow committing a crime, and that "stuff" must be taken away and distributed in a fair and equitable manner. They see anyone who does not support this as selfish and greedy, supportive of an unfair system that doesn't guarantee financial equality.


    Of course they fail to realize (or care) that this "economic justice" requires people being unequal under the law.


    And that's the part where the non-Socialist have a problem.

  • but that may also provide some beenfits.


    Benefits for whom?


    Political control of resources tends to benefit those with the most pull, not the average citizen.

  • I didn't come here to pass on our problems to the next president or the next generation.


    They may not get the problems, but they'll get the bill.

  • But I think the idea is "we're not going to put off infrastructure spending, health care reform, education reform, etc." Those are the burdens he's not going to place on future generations. But obviously solving those burdens isn't going to be free.


    Despite comments to the contrary, I am not being disingenuous (mea culpa, no I did not click through). How is spending now and paying for it later not passing on a burden? If the only "burden" is deciding whether to spend, maybe. Or if you think the burden lies in living with unreformed healthcare and education. And that's assuming his solutions are actually solutions.


    On the other hand, if Obama's "reformed" healthcare and education end up being more burdensome both because they are bad policy and because they are expensive, then you're passing on a significantly worse situation to the next generation.


    Sorry, I just find it pretty offensive to have him usher in massive spending and at the same time act like he's being responsible toward future taxpayers.

  • Daniel Kuehn

    And one more thing - Socialists do use reason. If anything they put too much faith in their own reason. Their ideas may not be accurate or advisable, but that's no reason to conclude that they're irrational. They just got the wrong answer. People make mistakes.


    Why does this have to be so vicious? Why does socialism have to be built up into a boogey man? Can't we talk like adults about the merits of socialism (very few if any, I'll grant), and not just use it as a one-liner to attack our political opponents?

  • Daniel Kuehn

    Haha - wow vidyohs. That was entertaining.


    1. Just because some crazy socialist that posts here thinks money grows on trees doesn't mean that socialists in general do - much less socialists that actually try to put their ideas into practice. I'm guessing "muirduck" is some tie-die wearing socialist wannabe with no practical experience in central planning (I doubt real, live, central planners or those who have seriously thought about the issue frequent this blog very much).


    2. Theft is a revenue source, not "magical money". It's a crude way of framing the issue, though. As bad as excessive taxation and inflation is, neither are "theft". Labeling them as such just muddies the waters.


    3. I find it odd that you've latched onto one "spread the wealth" comment (I assume that's what you mean when you say "having stated publicly the good of redistribution of the wealth), but you ignore all the comments where Obama has refuted you on:


    "Obama displays a firm belief in free markets? Well no.

    Obama displays a firm belief in capitalism? Well no.


    Obama displays a firm belief in individual responsibility in all things? Well no.


    Obama displays a firm belief that government can solve everything? Well yes."


    Why do you believe one statement of his is political and unreliable but the other is genuine?


    I'm not saying he doesn't want to increase the government's role in the economy. The question is - how is that socialism??? Socialism is a very specific thing - and it's not just expanding health care coverage and subsidies (good lord - he's not even advocating a single payer system! even THAT wouldn't be socialism, but he's not even proposing that!).


  • John

    Daniel,

    I, as well as most people here I'm guessing, could care less about Obama's platform.


    It's his actions that we're worried about.


    Like those people who call Reagan the crowned king of fiscal conservatism, seemingly forgetting that on his watch the government borrowed more money that all previous administrations combined.


    The actions of the current administration, regardless of the stated platform, are leading us down a road where government and corporate industry are so intertwined as it becomes difficult to tell them apart.


    Wait a minute, that's not Socialism.


    It's that other one that starts with an 'F'.



  • vidyohs

    Daniel, Daniel. Daniel. Tsk Tsk.


    You paint the socialist as if they actually recognize and use reason. All the evidence is there for you to know better.


    Where I am from we call a spade a spade not some bloody pitchfork. T-Brazorians know that a proper label/name increases efficiency when numbers of people are involved.


    That is why I call the man, who stated publically on TV that he thought we had to redistribute the wealth, a socialist. His administration is socialist, or haven't you been checking the bloodlines of his hound dogs?


    As for a socialist not believing that money comes from magical sources, Daniel Daniel Daniel, my man, you are assigned to go into this blog's history files and read everything posted by muirduck. When finished, come and tell me that he knows and understands where "government money" comes from.


    Socialism begins with theft, theft is the bedrock, Obama wants to increase the size of current government theft. Not satisfied with stealing damn near 60% of everything you earn, he wants more. Tax cuts renewed? Dream on. Increase in captial gains taxes, yep.


    Nationalization of health care......oh, I just realized Daniel, Obama isn't a socialist he is just promoting that as a sop to his socialist friends and supporters. Oh oh, and the environment, oh yes yes, government must hurry and commit vast taxpayers resources to fix what isn't known to be broken. But that isn't socialism is it Daniel, it is just prudent conservatism, eh?


    I don't have time today to list all the evidence that Obama is a devout socialist moving with, and being supported by, devout socialists. I have to express my deep sorrow to you, Daniel, that your eyes just sweep by the truth and never seem to see.


    Obama, having stated publically his belief in the good of redistribution of the wealth, is currently pushing hard for the most massive socialization of America ever attempted. Knowing that, I am to ignore it and believe you when you say he isn't a socialist? In the words of Mary Chang, my Chinese friend, "If he not socialist,why he do that, Daniel?"


    Obama displays a firm belief in free markets? Well no.


    Obama displays a firm belief in capitalism? Well no.


    Obama displays a firm belief in individual responsibility in all things? Well no.


    Obama displays a firm belief that government can solve everything? Well yes.


    Lord I have to go and the list is endless.

  • Methinks

    I agree with John's comment, except that I believe Obama doesn't understand, let alone believe much. He just says whatever the teleprompter tells him to say. It's like the special Olympics out there. Ha ha. Brilliant.

  • Randy

    No, Daniel, they don't. Socialists use a monopoly on the use of force to take what they want. Socialism is Leviathan run amuck. The foxes in charge of the henhouse.

  • Daniel Kuehn

    Or, on second thought, maybe they had no illusions that they couldn't run an economy - but they decided that their forced egalitarianism was worth the tradeoff with growth.


    Sounds kinda crazy, but not impossible.


    Humans make tradeoffs

    Socialists are, by all accounts, humans


    Socialists probably make tradeoffs too.

  • Daniel Kuehn

    nicole -

    Yes, he's not passing on the problem to future generations because he's dealing with it now... I fail to see the problem with that statement. Granted, it's a very political, feel-good statement and you have to take it for what it's worth. But I think the idea is "we're not going to put off infrastructure spending, health care reform, education reform, etc." Those are the burdens he's not going to place on future generations. But obviously solving those burdens isn't going to be free.


    vidyohs -

    I was so excited we were going to agree! And perhaps we did. But:


    1. Please stop this Obama = socialist stuff. The Obama platform has nothing to do with socialism, and that kind of talk lowers the level of debate.


    2. Even real, live, socialists didn't think that they paid for things with money from some "magic source". They didn't ignore those problems. They knew what was required to run an economy, they just missed the fact that a central planner isn't up to the task. No socialist who actually ran a central planning agency had any illusions about inflation, money supply, revenue, etc. etc. THAT wasn't their problem. Their problem was assuming that they could direct it all themselves.


    Now - could some socialist theorist in an ivory tower somewhere ignore these revenue issues? Perhaps - although I think even that is unlikely.


    The fallacy of socialism is at base a misunderstanding and an overstatement of an individual's capacity to do what decentralized market can accomplish, not a misunderstanding of the mechanics of an economy or a government budget.

  • T L Holaday

    What was the trade-off for smallpox eradication?

  • vidyohs

    I am encouraged though that Obama is sworn to solve the problems. IMHO that means certainly means dissolving government. Our problems are government created, and in my years in thinking about the problems, the only solution I have consistently come back to is take a mulligan on government and get a do-over.

  • vidyohs

    Disingenious comment, nicole, and ignores the facts.


    In this one I agree with Daniel, I read the report linked in Russ's post and taken at face value I see no indication that a trade-off is not understood. It even specifically mentions the massive debt that Obama's budget will cause.


    There is one big "however" that has to be considered though, Daniel. However, if Obama is like most socialist and is as far into his fantasies as the ordinary socialist, he will have the inherent belief that government funds come from a magical source, and that the acquisition of those funds never impoverish the working man. Which makes Obama totally unaware of the trade-off, because magic hurts no one.


    In the utopia of socialism all magic is good magic, they all "feel" that to be true.


    I see every evidence that Obama is a devout socialist. IMHO the "however" is in play.

  • Randy

    The concept of tradeoffs works well for a unitary decision maker, but the United States, despite the name, is not a unitary decision maker. It is a political entity, and therefore its actions are more accurately described as redistribution, or even retribution.

  • John

    I don't think Obama really cares.

    This crisis is an opportunity to increase and consolidate power in the name of problem solving.


    I'm not even so sure that the guy has a clue about what he's doing, except that he believes that the more power government has the better equipped government is to fix the economy.


    Of course this is all based upon the false premise that a few select Harvard graduates with the power of government behind them can effectively command and control the economy.

  • But Obama explicitly says he's not passing on these problems to the next generation. How does that show a recognition that he is trading off future taxes and inflation for growth now?

  • Daniel Kuehn

    I totally agree that it's all about tradeoffs - but that's an odd sentiment to be expressed on a blog that advocates fairly consistent policy solutions with little tolerance of market interventions that admittedly will involve some costs, but that may also provide some beenfits.


    Isn't Obama's whole point that he is trading off some future taxes and inflation for growth now? You may not agree with his call on that tradeoff - but it doesn't mean he doesn't recognize that life is about tradeoffs.


    Let's be honest - your political allies and your political opponents probably all recognize that everything is a tradeoff. Do them the charity of assuming that. If you would do that, Obama's statement would look a lot less like hubris and a lot more like a position that he took on a tradeoff that was different from the one you would take.

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