Greek Austerity

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Cueball Cueball's picture

I suppose it has some comedic value.

George Victor

Sven:

"Why would the Greek government be "forced" to balance its budget immediately?  Well, the only way Greece (or any country) can engage in deficit spending is for investors to put money into Greek bonds.  No investors are going to put any money in Greek bonds without significant austerity measures."

 

As Doug Saunders pointed out in the Globe, Germany was happy to sell its manufactured goods to Greece and German banks were delighted to extend the credit, but the German electorate is less than happy with the impact of greater state help to Greece because the electorate had no more ideas than the Greek populace about how it was worked out by the economic elite. Perhaps they could create some derivatives in Asset Backed Commercial olives and really flog them at the next Davos gathering?

Bacchus

Maysie wrote:

remind, re your post at #18: while I agree with you in principle, you can't call babblers "right wing hacks". Stop it.

Snert, re post #7: I've long been wondering if you belong on babble, what with all the mocking you do of the site and its participants.

Bacchus, you're on the border with the comment at post 25 as well.

....

Is there a way to have a progressive discussion about this?

I was trying to be somewhat sarcastic but I apologize Maysie *bows deeply*

kropotkin1951

Snert must be protected at all costs. His right to come here and argue for imperialism trumps all of our rights to have a conversation from a progressive perspective.

Ban me if you want but Snert is a right wing troll who's only reason for=being on this board is to poke at people and try to piss them off.

Fun game but not one I want to play anymore.

Snert Snert's picture

I'm really just curious, at this point, but when I suggested to Cueball that this bomber probably didn't apply for U.S. citizenship in good faith, WHY DO YOU TAKE THAT AS A POKE AT YOU?

N.Beltov N.Beltov's picture

Greek trade union webpage with short video showing thousands and thousands of demonstrators.

Sven Sven's picture

 

thanks wrote:

and what's 'gradual' about unemployment and rising prices? about poverty ?  residents are already over the brink.

I'm not saying that the EU/IMF terms are not onerous (after all, that's why it's called "austerity").  Instead, I'm saying that the non-EU/IMF alternative is going to be much more austere (and that appears to be what the socialist prime minister of Greece has concluded as well).

The Greek budget deficit is projected to be about 14% of its GDP (meaning a government deficit of about $48 billion).  The only way the Greek government can spend $48 billion more than collects in revenue is to issue bonds to investors who are willing to buy $48 billion of Greek government bonds.  If the EU/IMF austerity measures are not implemented, then the Greek government budget would have to be cut by $48 billion immediately (because no investors are going to loan any money to the Greek government to fund the $48 billion deficit).

Sven Sven's picture

 

torontosask wrote:

The public deficit in Greece is no higher than that in the U.S. or the UK, yet they are the ridiculed who have to take the medicine of the IMF. They obviously don't have the clout that the U.S. or UK have to deal with things internally, such as through the massive taxpayer bailouts of banks in 2008.

The public debt in Greece is about 115% of the Greek GDP.  In contrast, the UK's public debt is about 69% of the UK GDP and the USA's public debt is about 53% of the USA GDP.

It's not a matter of "ridiculing" the Greeks.  It's a simple matter of: Can the Greeks repay their debts?

N.Beltov N.Beltov's picture
Snert Snert's picture

Does anyone know what, very specifically, the protesters think the government should do right now?  Clearly not what they did do, but in lieu of that, what?  Default and go it alone?  Tax the billionaires?  Huge tariffs on olives and ouzo?

N.Beltov N.Beltov's picture

According to the Greek Communist Party, the 3 bank workers were killed by the actions of provocateurs (i.e., agents of the police or secret police) who have been attempting to discredit the protestors.

Quote:
The tremendous success of the nationwide general strike on 5 May constitutes a legacy for the escalation of the struggles. Yesterday, people gave their response to the policy that exterminates the workers' and people's gains, with dynamic demonstrations throughout the country. The organised provocative plans that solely aim at striking PAME and KKE will fall flat. PAME responds to the anti-people plans and the provocative actions with new demonstrations today, Thursday 6 May 2010, in 68 cities across the country.

On Wednesday evening, 5 May, the Press Bureau of the CC of KKE issued a statement on the massive strike demonstrations of PAME and the action of provocative mechanisms.

That reads, in part:

Quote:
The burning of the bank at Stadiou Avenue, which lead to the death of three people, and of the buildings at the centre of Athens, is a crime aiming at the intimidation of the people and the slander of the struggle for the overthrow of the barbarous measures, the anti-people policy. These actions are useful for those who try to submit the people with lies and slander.

KKE denounces, to all the Greek people, that the provocative plan was activated when the demonstration of PAME reached the Parliament. A group of provocateurs tried to involve demonstrators in riots by snatching flags of PAME and using different slogans and actions. Their intention was clearly to slander KKE and PAME. The immediate intervention of the workers who guarded the demonstration disarmed the provocateurs and isolated them, while they were also condemned by the loudspeakers at the demonstration.

The existence of a plan was proved by the slander launched against KKE by the chairman of the extreme right-wing party "LAOS" just moments after, in the Parliament. He claimed that KKE called on the demonstrators to invade the Parliament and set it on fire. The same slander against KKE was also launched by TV channels and radio stations that belong to the big capital.

Bosses, and their agents, are the same everywhere. We have, furthermore:

Quote:
In her speech at the parliament, right after the announcement of the death of three people, Aleka Papariga made the following statement:

"The working people, who suffer an unprecedented attack, the worst after 1974, are able to distinguish the systematic political struggle for the defense of their rights, for their protest, a struggle that can take many forms according to the conditions at each time. They can clearly tell the difference between this struggle and every plan aiming at the subversion of the struggles, every provocative action that causes innocent victims and aids all those who want to create a scenery in order to slander the struggles.

People should not only defy the provocations but they should also take all the measures to protect their struggles which should start from the workplaces. They should hit where it hurts. the starting point of the battle must be the workplace and lead to a nationwide struggle.

I should also stress the following: stop putting the blame on the people. People are blamed for the crisis, for everything. The responsible organised people's movement cannot be blamed for actions planned backstage. This provocation will not pass. We will continue our struggles".

from the legendary Acropolis, symbol of Greek civilization going back to the ancient world ...

 

 

 

Catchfire Catchfire's picture

Great pic, Beltov.

N.Beltov N.Beltov's picture

It would be nice to believe that Greeks can, once again, gift the rest of the world with their philosophical ideas. Or, at least ignite a political conflagration across Europe. It's overdue.

Sven Sven's picture

N.Beltov wrote:

"They declared war. Now fight back."

From the N.Beltov's link above:

During the parlimentary debate today, the Socialist Prime Minister of Greece, Papandreou, said: "Today things are simple. Either we vote and implement the deal, or we condemn Greece to bankruptcy."

Snert wrote:

Does anyone know what, very specifically, the protesters think the government should do right now?  Clearly not what they did do, but in lieu of that, what?  Default and go it alone?  Tax the billionaires?  Huge tariffs on olives and ouzo?

Evidently, they are seeking bankruptcy.  It's the only real alternative.

N.Beltov N.Beltov's picture

It's a fight over who will pay the consequences of the huge Greek debt. I say make the rich pay. What do the right wing participants here say?

Oh yea. We already know the answer to that. lol.

Joey Ramone

N.Beltov wrote:

I say make the rich pay.

And tax the churches, like any other businesses.  Imagine the revenue that could be collected from those scoundrels.

Snert Snert's picture

Quote:
What do the right wing participants here say?

 

I asked, back in MARCH, why the government isn't just going to soak the rich. If they were a conservative government, the answer would be clear. If they were a socialist government with a tiny, fragile minority in the midst of a multitude of coalitions, the answer would be clear. But in this case, the answer's not clear.

 

I'll turn your question around: what does Greece's majority Socialist government say?

Sven Sven's picture

N.Beltov wrote:

 

The Germans, among others, are thinking: "Peoples" of Europe Rise Up?  Ah, no, how about: [u]Greek peoples[/u] rise up...and get real!!"

It would be interesting to hear what solutions the protesters actually have (or the Commie Party leaders).  Apparently, they don't want make dramatic cuts in the government's deficit spending.  So, what's their brilliant plan to avoid bankruptcy?

Bacchus

Greece: Default is no soft option

 

The head of the European Central Bank once again said today that a Greek default "would not happen". Every G20 official - in or outside the eurozone - will tell you the same thing: with markets as fragile as they are, it is unthinkable that a sovereign government would be allowed to default. Investors and experts are thinking about it all the same.

 

N.Beltov N.Beltov's picture

Solidarity and internationalism are words understood in all languages.

Greek and Urdu? Or is that Bengali? Any babblers know?

Sven Sven's picture

I've got a great investment tip for you, N. Beltov: Why don't you put your hard-earn money into Greek bonds?

N.Beltov N.Beltov's picture

Sorry, I couldn't hear you over the massive demonstrations and recent general strike in Athens. Gosh! It's loud.

BTW, how many thousands of demonstrators do the rich Greeks, their sell-out social democratic regime and their IMF representatives been able to muster? I can't seem to find any photographs? Perhaps they're having tea?

Bacchus

Im afraid the protests are not that massive. The numbers Ive heard have been in the max 10k range.

 

Protests of old used reach 100k or more. People are pretty much accepting what the socialist government is enacting. Not that I know which way is the right way to go Im afraid, but then I dont think the government does either

N.Beltov N.Beltov's picture

68 cities with demos is fairly substantial, don't you agree? Let's see how it plays out.

Sven Sven's picture

Bacchus wrote:

Im afraid the protests are not that massive. The numbers Ive heard have been in the max 10k range.

That's what I've read, too.

In related news: The Socialist government approved the EU/IMF terms earlier today.

Cueball Cueball's picture

Sven wrote:

I've got a great investment tip for you, N. Beltov: Why don't you put your hard-earn money into Greek bonds?

Yeah. That is the spirit Sven. You are finally figuring out what solidarity means.

Bacchus

N.Beltov wrote:

68 cities with demos is fairly substantial, don't you agree? Let's see how it plays out.

 

100 cities with 100 protesters would not be large so no the number of cities does not impress me.  And all interviews even with protesters show they accept its coming they jsut want more pain given to the politicians and bankers. In other words whats going to happen to them is acceptable but hit the others too

Angry Greeks 'carrying the can' for politicians

 

N.Beltov N.Beltov's picture

Obviously, the authorities were concerned enough about the demos to sponsor agents provocateurs. And it was provocateurs who burned down the bank and killed three bank workers.

Bacchus

N.Beltov wrote:

Obviously, the authorities were concerned enough about the demos to sponsor agents provocateurs. And it was provocateurs who burned down the bank and killed three bank workers.

 

Personally I think thats bullshit. Protesters got out of hand which does happen and no one wants to claim responsbility. Of course the side organizing protesting will say its the government just like the government will say it was planned by the protesters.

N.Beltov N.Beltov's picture

The KKE wrote specifically about this issue. I will re-quote what I quoted above ...

Quote:
The burning of the bank at Stadiou Avenue, which lead to the death of three people, and of the buildings at the centre of Athens, is a crime aiming at the intimidation of the people and the slander of the struggle for the overthrow of the barbarous measures, the anti-people policy. These actions are useful for those who try to submit the people with lies and slander.

KKE denounces, to all the Greek people, that the provocative plan was activated when the demonstration of PAME reached the Parliament. A group of provocateurs tried to involve demonstrators in riots by snatching flags of PAME and using different slogans and actions. Their intention was clearly to slander KKE and PAME. The immediate intervention of the workers who guarded the demonstration disarmed the provocateurs and isolated them, while they were also condemned by the loudspeakers at the demonstration.

The existence of a plan was proved by the slander launched against KKE by the chairman of the extreme right-wing party "LAOS" just moments after, in the Parliament. He claimed that KKE called on the demonstrators to invade the Parliament and set it on fire. The same slander against KKE was also launched by TV channels and radio stations that belong to the big capital.

The Greek Communists even seem to suggest coordination by the right wing political forces and the provocateurs.

 

remind remind's picture

Snert wrote:
So if I'm reading you right, babblers either need to believe that the Greek crisis is solely the fault of shadowy and anonymous "elites" and that the Greeks themselves are blameless innocents, or else those babblers are trolls who belong at Free Dominion.

Is that about right?

 

No, as really, pretending that  huge bodies of information does not exist about why Greece and indeed the world, are in the financial mess they are in, here at babble does not wash.

There is no shadowy "elite",  as you are trying to portray, it is well known who the players are, and pretending it isn't, ad naseum, is pretty insulting. But you care not, as it is not the babble audience you are speaking to.

...it is pre-101 historical and current knowlege, and babblers do not have to even debate 101 here, and you know this, yet you carry on anyway, as if it  wasn't, and was some big mystery or conspiracy theory, and as if oppression doesn't and never has existed, because afterall it is just some people's natural or god given right  to oppress and screw over other peoples.

 

The funny amusement factor long ago wore off.

N.Beltov N.Beltov's picture

from Democracy Now ....

Quote:
COSTAS PANAYOTAKIS: Basically, you have a new government, it's imposing the austerity policies that it run against, and this is an attempt to solve the crisis on the backs of ordinary Greeks. And, as is usually the case with the International Monetary Fund, it's also an attempt to indirectly bailout the German banks, French banks, and European banks that hold most of the Greek debt. So it is a very brutal, unprecedented program. It will reduce wages, it will reduce pensions. It will make it easier to fire people. As people get fired, they will find their severance pay be reduced. Part of the package will actually be used to support banks and private businesses.

Quote:
And there is some resistance going on. This resistance has to escalate the strikes, general strike planned for tomorrow. I think there's also the possibility of social explosions like the big revolt in December 2008 that you reported on. At the time, people were saying that this was the revolt of the generation of 700 euros, which was the minimum monthly salary for many of the young workers. Well, with the new measures the generation of 700 euros is becoming the generation of 550 euros. So, basically, it's a very difficult situation, and it's an attempt to solve the crisis that has been produced by Neoliberal free-market policies by policies that have the same conservative philosophy, but are much more brutal and much more draconian than the policies that caused the crisis.

SHARIF ABDEL KOUDDOUS: The mainstream press reporting on this, I mean, The New York Times has used the word many times, ‘the profligate Greeks,' the irresponsible Greeks. Talk about that coverage and also about the response- these austerity measures you say are more brutal than the response to the crisis here in the U.S.

COSTAS PANAYOTAKIS: Yeah, first of all, there is a lot of misinformation about what is going on in Greece. The wages and the pensions in Greece are anything but generous. What you have also, it's not that ordinary Greeks are profligate; ordinary Greeks are basically struggling to survive. I mean, there is a problem with the government not being willing to tax people who are wealthy, people who own businesses, and so on and so forth. So, always, whenever there's a crisis, salaried and wage-workers are the easy mark and this is what's happening with this package. And I think there is also a problem that there is a certain parallel, I think, in the United States of people being angry at bailouts and the crisis. Instead of blaming the system and the policies that cause the crisis, they look for scapegoats, so you have the rise of a right-wing populism. This is a problem in Greece. This is a problem in Europe. Oftentimes, Greeks, the way they're portrayed is basically, Greeks are being racialized within Europe. And the same is likely to happen in Southern Europe as well. So there is a new rift that is coming up. It is feeding this kind of scapegoating that we see in the United States, if you think of the Arizona law and how supporters of the Arizona law- I saw a debate just a few days ago, the supporter of the Arizona law started by the fact that there are millions of Americans who are unemployed, and then he said there are millions of illegal immigrants are employed in the U.S. So, they capitalize on the understandable anger of ordinary people in the face of these crises.

Protests in Greece: Democracy Now

 

N.Beltov N.Beltov's picture

from the CBC report just now ...

"The stealing from the pockets of working people cannot go on."

"This is a social genocide. We cannot accept this."

 

N.Beltov N.Beltov's picture

Meanwhile, back at the capitalist outhouse of Wall Street, a trader at a major dealer made a 16 billion dollar mistake. Oops.

Forbes wrote:
All day long, spreads in credit default swaps on major U.S. banks, like Goldman Sachs, grew wider on concern that a Greek default would translate into adverse consequences for financial companies. The euro plunged on the same concerns, now around 1.27 to the U.S. dollar. Gold soared $22 an ounce, settling at $1,197. There was plenty of fear in the market before noon.

God forbid financial companies suffer adverse consequences. The rich continue to speculate on the misery of others. Ain't capitalism GRAND??!

 

epaulo13 epaulo13's picture

N.Beltov wrote:

from Democracy Now ....

Protests in Greece: Democracy Now

AMY GOODMAN: What is your assessment of how the Socialist Prime Minister, George Papandreou, has dealt with this?

COSTAS PANAYOTAKIS: Well, I think from what I have read, from what he had said, including in your program, he came in with this idea that basically political democracy can tame capitalist markets, and that’s what socialism is about in his view. But what he’s proving, basically, is that under capitalism, the market usually ends up overpowering and making a mockery of political democracy. So I think- he wants to present the situation like he means well, he didn’t know what was going on, but you know, that’s what every Greek government has said.

 

..here lies the werakness of social democracy. it can not control capital.

N.Beltov N.Beltov's picture

I've included below a link to a fairly recent (Dec 2009) analysis by the Greek Communists ( Eleni Mpellou, CC & Politbureau Member of KKE ) of the current economic and financial crisis as it affects Greece. I will have a read and either add a comment here or further along in the thread if I have anything to add to the link.

The international economic crisis and the position of Greece. The theses of KKE.

Doug

Individual nation-states have a hard time controlling global capital - it doesn't matter how radical you are.

jrootham

I fully expect to see a Greek default.  As part of that, to start, state wages get paid in New Drachmas (California scrip, anyone?).  Shortly after that, all wages get paid in New Drachmas.  New Drachmas will not be worth much relative to Euros, so exports to the Euro zone will be very profitable, and imports will be expensive.  Greek vactions will be mind boggling cheap for Germans.  Eventually this will all straighten out. 

But it all depends on New Drachmas.  No new Draxhmas, long term pain and huge internal conflict.

This advice is pretty public by now (see Paul Krugman), so I expect there is planning to do this inside Greece, if not at the EU yet.

 

Doug

Of course, by then anyone in Greece with money will have moved it to a German bank.

N.Beltov N.Beltov's picture

from the article by the KKE, a few points ...

1. Already in 2008 there was a massive decline in the value of assets in the Athens Stock Exchange after the October 08 mass withdrawal of foreign investors;

2. Terms of borrowing for the Greek government dramatically worsened in mid-2008;

3. " the outbreak of crisis in the Greek economy is going to be profound. Predictions are being made that it will last for 2 years. It will sharpen the existing social contradictions through the increase of unemployment, part-time employment and the extension of flexible working relations. According to bourgeois measurements, poverty has already increased, with a particular concentration (about ¼) among children up to 15 years of age, as well as people in the 18-24 age bracket."

4. The KKE's analysis, from the previous economic crisis in 1998, referred to a crisis of over-accumulation of capital (see the work by the late Paul Sweezy et al in this regard) and their own prediction of more attacks on the wages and working conditions of ordinary people that would inevitably follow;

5. Critically, the following:

Quote:
We consider that the same tendency of deterioration that was manifested during the two previous decades will continue and sharpen, unless there is a visible ideological-political and organizational revitalization of the international communist movement, an emancipation of the trade union movement from the government and employer-led trade-unionism, its disengagement from EU mechanisms of manipulation (ex. ESC etc.), an ideological-political emancipation of wider working forces from the deceiving influence exerted by the so-called social-democracy, through old or new political formations.

The inner contradictions of capitalism and the international capitalist competition have reached a level where the working class, the salaried laborers that approach it in terms of income and living standards and the lower sectors of the middle strata can slow down the deterioration of their position only if they counterattack, if they avoid any political traps of compromise, consensus, acceptance of an allegedly necessary "class collaboration" for the confrontation of the crisis.

Freedom from "the deceiving influence of ... social democracy."  Hear, hear!

6. Despite capitalist unevenness of development, "the nation-state remains the organ that guarantees the economic dominance of monopolies and serves the concentration and centralization of capital in competition with similar processes in other member-states of the EU."

7. a very critical note: describing the period of the 1930's as an era, above all, of great "social prosperity" in the former Soviet Union without making reference to the Stalinist excesses and crimes and show trials, etc. , casts a dark cloud over this overwise interesting piece. We all know that capitalism was undergoing a profound crisis at the time but this hardly merits sweeping such crimes under the rug. Gah.

The article ends with a demonstration of the necessity of social ownership and some kind of central planning.

Sven Sven's picture

jrootham wrote:

California scrip, anyone?

Ha!  That's about it.  California is the Greece of the U.S. -- only worse.

The California public employee pension funds have a current shortfall of "more than half a trillion dollars," according to [url=http://siepr.stanford.edu/system/files/shared/GoingforBroke_pb.pdf][colo... Stanford University study[/u][/color][/url].  The state's taxpayers are responsible for any shortfall and that represents a per-household liability of almost $40,000 (just for public employee pensions!!).  What this means, of course, is that all other state spending (from everything from roads to schools to universities to healthcare to everything else the state has to pay for) will suffer significantly.

On top of that, California is already one of the highest taxed states in the country (and more people -- along with businesses -- are now leaving California than moving to California).  So, it's going to be hard for California to tax its way out of this mess when the tax environment is already unfavorable.

Sven Sven's picture

Doug wrote:

Of course, by then anyone in Greece with money will have moved it to a German bank.

And will likely have moved their persons (and businesses) to Germany as well!

George Victor

Sven wrote:

Doug wrote:

Of course, by then anyone in Greece with money will have moved it to a German bank.

And will likely have moved their persons (and businesses) to Germany as well!

Given the exposure of German capital in Greece, they might want to deposit it a bit farther north than that.

epaulo13 epaulo13's picture

Doug wrote:

Individual nation-states have a hard time controlling global capital - it doesn't matter how radical you are.

..i suggest that capital is not difficult to control but that it is out of control. one only need to look at cuba, bolivia and argentina to catch a tiny glimpse of what is possible if there is the will. as well as what it takes to achieve control.

thanks

official describing program for greece today:

http://www.imf.org/external/np/tr/2010/tr050610.htm

"And the second part of the program, which is extremely important but of course takes some time to yield results, is on the structural side where reforms aimed at opening up the economy, opening up opportunities in the Greek economy, allowing more flourishing of investment and growth are included. And that part of the program is aimed also at competitiveness and growth."

may 02 staff level program  http://www.imf.org/external/pubs/ft/survey/so/2010/CAR050210A.htm

"• Structural policies. Government to modernize public administration, strengthen labor markets and income policies, improve the business environment, and divest state enterprises."

strengthening labour markets means weakening labour, income will flow to the bankers who will also take over public governance and the privatized state enterprises.

and Harper is negotiating an investment deal with this banker-focussed EU,

combining NAFTA and other deals, propping up the worst financial sponges on both sides of the Altantic.

No Thanks.

 

Frustrated Mess Frustrated Mess's picture

Snert wrote:

Does anyone know what, very specifically, the protesters think the government should do right now?  Clearly not what they did do, but in lieu of that, what?  Default and go it alone?  Tax the billionaires?  Huge tariffs on olives and ouzo?

Default, take over the factories, eat the rich, buy oil from the Iranians. And your solution is for Greeks to become indentured serfs in their own land. Will you have them sell their children in to white slavery? That should fetch them a few bucks, eh?

Sven Sven's picture

Frustrated Mess wrote:

Snert wrote:

Does anyone know what, very specifically, the protesters think the government should do right now?  Clearly not what they did do, but in lieu of that, what?  Default and go it alone?  Tax the billionaires?  Huge tariffs on olives and ouzo?

Default, take over the factories, eat the rich, buy oil from the Iranians.

That would be interesting to watch.  Then, they could have a sparkling new economy that looks kinda like Cuba or Venezuela's economy.

jrootham

Actually, Argentina is the model.  Down to the use of a foreign currency (the dollar for Argentina, the Euro for Greece).

Argentina did default, and is now in better shape than it was.

It's not like stuff similar to this has never happened before.  We can learn from history, but first we have to remember it.

 

N.Beltov N.Beltov's picture

That comment from the Greek Communists about the deceiving (and harmful) influence of social democracy has made me think that this is a suitable topic for a general thread on that very issue. More to follow.

Doug

Snert wrote:

Here's a question I asked as a comment to Humberto DaSilva's vlog post about Greece:  what, really, is stopping a Socialist government from shifting the burden of this from the public and the public sector to the rich and the private sector by way of an increase in corporate taxes, capital gains taxes, and so on?

 

Corporations have to have profit before they can be taxed - a fair number of Greek comparies will be in trouble now - and there is no capital gains tax revenue to be had while the price of assets is dropping. It'll help later on, perhaps, but not right now. Also, it is fairly easy for corporations to move profitable activities elsewhere in the EU physically, or even easier through accounting measures. So there's a cost that offsets the gain of doing this.

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