What should I ask Jason Furman?

I will be doing a Conversation with him, yes the Jason Furman.  So what should I ask?

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What are the top 3 Bayesian updates we should perform (relevant to US economic policymaking), having observed the past decade of economic growth and development in China? In other words, what do we need to start doing differently? What have we learned?

Also, what is the best way to engage with China's despicable inability to appreciate President Trump as the world's leader and de-facto chief?

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Meta: What are the key considerations Jason Furman uses when evaluating the appropriateness of regulating companies or industries with network effects and where incumbents retain leads on some (but not all) innovation frontiers? How is this problem changed when considering technological competition from China?

Object-level 1. Does he have an opinion on whether the dominant American tech companies — Google, Facebook, Amazon, Apple — should be regulated with respect to their market share, network effects, where they’re at on their innovation S-curve, and international technological competition from China? If so, why, which, and how? If no, why?

Object level 2. If so,

Object l

pros and cons of high-margin technology companies

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What accounts for the Republican Party's acquired taste for deficit financing to support tax cuts for the wealthy?

How will this impact the middle class?

Being as the deficits are being used to subsidize the consumption of the middle class I’m pretty sure they will be just fine.

60-70% of the federal budget from your taxes (not including SS which is in surplus and a separate account) is for the military (including veterans benefits, VA, DOE military related spending (By the way, this is called the discretionary budget account, which is where your taxes are paid into) . Big middle class program in the discretionary account in the remaining 30%, like roads, bridges, and farm programs, but that doesn't include the promised HUGE infrastructure program, other than a three mile section of a wall.

Federal outlays 2018:

Social security: $982 billion
Medicare: $582 billion
Medicaid: $389 billion
Unempl, fed retirement, SNAP, EITC etc: $570 billion
Non-defense discretionary: $639 billion
Defense $623 billion
Net interest: $325 billion

Yes we should cut defense spending. But talk about missing the forest for the trees.

You didn't read my comment, but I expect you chose not to read the separation of mandatory from discretionary accounts). Everyone else can read what preceded your comment to see that you are obfuscating in your response.

Look at the discretionary account. It was clear what I said, and you chose to ignore it.

What you said may pass as intentional, or maybe ignorance of the federal budget or the budget process. If if it ignorance, may I suggest reading:
We Are Better Than This: How Government Should Spend Our More by Prof. Edward D. Kleinbard, former Chief of Staff US Congress Joint Committee on Taxation (Oxford Press2015). See pages 161-164.

Defense spending: $617 billion for the base budget + $69 billion for war funding = $686 billion.

Non-defense discretionary spending, from above, $639 billion, which includes some defense related spending (VA, DOE, etc), without allocating interest to defense.

How much of Medicare spending is offset by specific medicare taxes and fees. Medicare is one of only two self funded federal expenditures and yet is treated as a net loss to taxpayers.

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Money is fungible, so it’s ridiculous to assert ‘x% of the deficit is due to this specific thing.’ And social security is not sequestered from the rest of the budget, not in reality. SS taxes aren’t just used for SS or saved, and if there’s an SS shortfall, the government has to make it up somehow.

Why do you think Congress puts one in a discretionary account and the other in a mandatory?

Money is fungible, but taking money out of one account and putting in another is another matter.

Unless you would like SS and Medicare checks stopped when we have a budget impasse.

After all, money is fungible.

In short, it is not ridiculous, it is sensible.

I.e., after setting aside almost all non-defense spending, defense spending accounts for most spending.

Surely you can do better than this.

Well, you can read the book on the federal spending and tax accounts recommended above.

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I’m sure the poor and middle class that benefit from that military spending will be glad to hear that they don’t benefit at all. Surely no one would complain if we closed a few bases, ended the VA and recalled a few pensions. After all, there are deficits to worry about.

We only worry about deficits when a Democrat is president.

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Furman's appointment as chair of the CEA was controversial, not because Furman was deemed too far to the left, but too far to the right. Okay, so Furman is a (quiet) defender of the liberal world order at a time when it's under attack from every direction. On the other hand, Furman was a (mild) critic of the Fed in the summer of 2018 when the Fed announced a shift to addressing inflation (inflation that did not exist). If Warren or Sanders were to win the election, I wouldn't expect Furman to get an appointment to a high level position in the administration. But if Biden is elected, I suspect Furman would be a leading candidate for a top position. Question: would Furman accept? And if so, would he continue to promote a "strong" dollar in order to fund trillion dollar deficits, and would he continue the Trump administration's policy of demanding a veto power over China's fiscal/industrial policy?

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Doesn't it make more sense for Democrats to focus on closing all the loop holes for the wealthy where we don't tax every dollar like its a dollar: capital gains, pass through payroll deduction, interest deductions for business and home, etc. that distort the economy rather than focusing on new wealth taxes that are hard to collect?

+1

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+1
and to this point, this would be a good topic to engage Furman on. Rather than the Kudlow approach to just cut taxes, why doesn't the Administration really look towards cleaning up the tax code??? End all preferences and simplify things down to two brackets.

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Judging by the complaints about capping the SALT deductions, I think the Democrats may have some internal problems with this.

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Is it okay for government to manipulate labor markets through targeted visa programs (like the H-1B for tech)?

Wouldn't price signals alone correct any perceived 'shortage'?

Not if those hired produce external costs such as descendants whose crime, unemployment, and low assimilation rates compared to the average American are not borne by the companies doing the hiring. Seems like the US has the right and the obligation to care about long term effects of immigrants in absolute terms (not relative to other equally poorly performing Americans as is often used in misleading immigration studies). This is standard economic theory. Worse if the groups involved also change the political spectrum in ways detrimental to the average citizen.

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- Suppose a politician wants higher taxes on the rich, what is the best way to do that? (Increase top marginal income tax rate? Estimate taxes? Inheritance taxes? Wealth taxes?)

- Thoughts on Medicare for All

- Advice for people considering an Economics PhD

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Why didn't the Obama administration do more to tackle exclusionary zoning as a way of growing the economy?

Matt Yglesias gave a story about his interaction with Obama's economic team that makes you want to ask someone like Jason Furman what they were thinking. Yglesias says:

"I got a call from the White House (the good one, not Trump) to see if I could come in and hear about something the economic team was working on. So being amenable to flattery I did...

...Anyways we’re in there and they proudly announce that they’ve done the math on a bunch of widely discussed ideas to boost American economic growth and basically none of them move the needle at all. Except removing barriers to housing production. So I’m like “great; what are we going to do about the barriers to housing construction?”

Their plan was to do nothing. They just wanted to point out that other people’s growth ideas were bad. They said they’d do a Council of Economic Advisors report that said housing was important; and they asked congress to create a small grant program inside HUD that would offer technical assistance to local governments that wanted to pursue zoning reform.

Well that’s not going to do anything I said. And they didn’t disagree. But what did I want them to do. I said Obama should show up at a community meeting somewhere and yell at the NIMBYs about how they’re ruining the country. Still think that’s a good idea! But they didn’t go for it."

https://medium.com/yimby/matthew-yglesias-on-yimby-693b11d798bb

This makes you want to ask someone like Furman, why didn't they do more to tackle NIMBYism?

Because the White House has no right to wage war on our communities to make rich people richer.

Yes, our #1 priority should be to keep people from getting rich, not increasing the housing supply and making housing more affordable.

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And he still thinks it’s a ‘good one?’

Interesting story though. The federal government in truth is rather limited I think in what it can do on housing; mostly it’s local governments that have to be moved to change, and asking an admin to, say, threaten to withhold funding from the state governments with which it is most closely allied (NY, CA, etc.) over housing reform would be a pretty big request.

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Interesting question and context. Zoning is local but presidents could and should leverage their bully pulpit to say:

1. To libertarians/conservatives: zoning is heavy-handed government intervention in the housing market, and like most any intervention, it's inefficient and has unintended consequences. Why would we expect the civil service to know better than you and me? Who should decide how much is too much? Individual buyers and sellers through the market, not local bureaucrats through government.

2. To progressives: first, zoning hurts poor people the most because it prices them out of communities. When it's harder to build housing, it's harder to buy housing. Second, density doesn't need to be lifeless Shanghai skyscrapers; it can be the aesthetic and walkable five-story flats of Madrid or Amsterdam. The real beneficiaries of building more housing aren't developers; they're hard-working African Americans, Latinos, and immigrants who have one less obstacle to realizing the American Dream.

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There could be a Government led initiative to create new dense Cities. For instance take some farmland near to SF, and using eminent domain, buy up all the land for a million person city, and create an area plan, with road and public transport infrastructure, parks and other amenities all detailed out with a 25 year plan for construction. Implement fast track planning approval, with pre-approved designs. Then sell of land to anyone who is interested with a commitment to build within 5 years of purchase, mandatory sell back at original prices if nothing built and occupied by that date. All housing to be dense, i.e. multi-story sort of like a New New York. But with large apartments! Overall funding for all the new infrastructure could be based on bonds payable back from new housing taxes over 50 years. Middle eastern countries are doing this now. Part of the deal could be green - having everything solar powered. Recycle water and ensure everything built to a certain energy standard.

Twenty of these new Cities for the US would certainly make a dent in housing costs. You could create an agency (The Twenty New Cities) agency to implement it.

You can't just put a million person city somewhere. No one will want to live there, there's no jobs, no culture, nothing.

The 'cities' in Iran and UAE and Saudi that are trying this, not to mention China, are empty concrete hellscapes.

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CNBC reports this morning that the Nov 2019 US trade deficit was the lowest of Trump's Presidency (the reported figures could of course be subject to revision):

https://www.cnbc.com/2020/01/07/us-trade-deficit-at-43point09b-in-november-vs-43point6b-estimate.html

Because comparative analyses can be so tricky (even for economists): what was the lowest monthly US trade deficit figure during Obama's Presidency? (Feel free to cite Bush's figures, too, might even be helpful.)

First question to ask: What is the significance of a US trade deficit, if any?

Bingo.

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Does Saez and Zucman have any credibility left? What is the proper response from academia to members who pursue an ideology in a political campaign under the guise of promoting peer reviewed objective research?

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How exactly can we avoid a debt bubble, which if it crashes can bring a recession to end all recessions? If for some reason the world sours on US Treasury Bonds, then the very tools that the government can use to avoid a massive recession---namely, borrowing and spending---will be unavailable to the government. And it's hard to see how the debt bubble won't burst at some point, give how much debt the US has.

Is there an index-funds bubble?

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Does he now think any large program like ObamaCare should be passed on bipartisan basis or not at all given the ability of the opponents to sabotage the program post implementation.

My two cents is that the way Republicans passed Medicare Part D without taxes should be followed...so don’t bother paying for it in the legislation and don’t make such a big deal about CBO scores. So the ACA and Medicare Part D were necessary fixes to existing programs and thus don’t need to be paid for in the bill.

So with respect to health insurance most of the health care costs of those under 65 years of age are covered by what amounts to a VAT that is passed along to the American consumers. So people that don’t get health insurance through their employers not only pay the VAT but then are forced to buy expensive health insurance with after tax income...pretty much everyone in Congress believed that needed fixing including Republicans. So the ACA was a fix to an existing system just like Medicare Part D and it didn’t need to be paid for in the bill.

Interesting, I've never heard that way of thinking about it. Seems to have done more harm than good tho - the metrics of coverage were never achieved, fewer competitors, many who have insurance cannot afford to use it - high deductibles, co-ops failing, higher wait times, etc. On balance, did it fix more than it broke?

Actually the people with employer provided health insurance are satisfied with their health insurance. Furthermore the stakeholders of the employer provided health insurance system (insurance companies and employers etc) lobbied during the drafting of the ACA to perpetuate that system.

So Bill Gates and Jeff Bezos and the states apparently are satisfied hiring what we refer to as a health insurance company to run their health care programs for their employees. I think Bezos and Gates prefer having some control over the spending of the VAT revenues and not just allowing government bureaucrats handle the revenue...although the group market is heavily regulated so they don’t have total control over the revenue.

I see - I guess my perspective is biased because I am retired (at 45 so employer provided health care is not available) and I am a freelance musician (so many of my friends and bandmates) struggle. Many of them are Bernie Bros (low income, high student loans and no insurance :). It's tough to fall in the crack!

I participated in the 2016 Republican primary but I will not be voting for any Republican in the foreseeable future for 2 reasons—Republicans have behaved extremely irresponsible with respect to Obamacare and Liz Cheney is in a leadership position in the House. This incarnation of the Republican Party is filled with people that have no problem flushing trillions down a toilet in the Middle East but won’t expand Medicaid so unlucky Americans can get the bare minimum of health care coverage. Trump is the best thing about these Republicans and I think he should be removed from office for abusing his power.

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Many (most?) of the big companies self insure for employee health insurance, they just hire “insurance” companies to administer their plans, for a fee. This admin work is competitively bid.

Those companies set their coverage footprint and premiums, not the administrators. It’s a competitive element of the total compensation plan, like the level of the 401k match, set with attract/retain objectives.

Correct, that means Bezos and Gates believe Humana and Aetna add value to their company which undermines one argument for Medicare for All. If Aetna and Humana add no value then why do Bezos and Gates hire them to manage their employees’ health care programs??

Btw, the group market is a very business friendly market created by the government and it allows some semblance of free market forces to be injected into a market that logically should be run by the government. So we got lucky the UAW and New Deal Democrats created the group market and I believe it should be perpetuated in large part because it allows Medicare to better allocate resources and set prices. But obviously the most logical health care system is single payer universal coverage.

Big companies offer health insurance as it is a very tax efficient form of compensation. It also slows down turnover, so acts as a golden handcuff.
https://www.mercatus.org/publications/government-spending/tax-exemption-employer-provided-health-insurance

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Has the China Shock literature changed his view of what an optimal counterfactual trade and trade adjustment policy looked like over the last two decades? If there was a policy error, was it in how we limited trade or is it in how we helped places and people adjust?

Also, does he view "Democratic economist consensus" (interpret that as he likes) as taking the same lessons from the China Shock literature that him, or does he disagree? In general, are we learning the right lessons from this?

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What is Jason's view on the helping people versus helping places debate? If we should help places, how would he do that?

+1

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1. What would your ideal federal tax reform look like, and what would your ideal politically feasible federal tax reform look like? Why? (This could be after the 2020 election)
2. Looking back on the ACA, what are you most proud of, and what do you wish could have been done differently?
3. I second the previous commenter on a question about Medicare for All.

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What can the US and UK civil services learn from each other? https://www.gov.uk/government/publications/unlocking-digital-competition-report-of-the-digital-competition-expert-panel

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In a 2015 speech, you made the following observation.

"The U.S. economy has substantial structural strengths and our stronger economic recovery is building on these strengths, including the lowest health cost growth in fifty years, reduced dependence on foreign oil, and enormous innovative potential. But additional policies would enable us to more fully capitalize on these strengths."

Questions and Answers: The Economic Recovery and the Path Forward

Remarks by Jason Furman Chairman, Council of Economic Advisers

Economic Policy Conference, National Association for Business Economics (NABE) March 10, 2015
https://obamawhitehouse.archives.gov/sites/default/files/docs/20150310_questions_and_answers_nabe.pdf

Questions
What would a government ban on fracking do to the price of oil and the economy?
What candidate in any party agrees with your observations on health care costs, dependence on foreign oil or any of your recommendations?

What honest experts should be asked one day
Were it not for domestic oil production, would the "Obama economy" have match Carter's?

Fracking for natural gas saved the American economy. So the underlying cause dysfunctional economy of 2001-2007 was a quiet energy crisis in America and obviously a dysfunctional global oil market.

So believe it or not the US economy had a very clear path forward in 2009 once fracking for natural gas was proven economical. So we would have been just fine even if fracking for oil was never proven economical because natural gas is what gives North America a competitive advantage not oil production which is very easily shipped.

Btw, one of the most important fracking regions is 25 miles from one of America’s most important aquifers in San Antonio...so I don’t buy any of stuff about fracking poisoning ground water.

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Is Harvard still elite?

Underrated or overrated... Juggling? Matt Damon? Hollywood? Harvard?

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If the US pushed back the age of social security eligibility by one year, and used the savings to invest (in, say, scientific research or infrastructure), does it produce a better or worse long-term outcome?

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The US is losing a tremendous amount of manufacturing capacity. Is the off shoring good for the US in the long run? What if China decides at some future point (after capturing even more manufacturing) not to trade with the US? Is continued growth of the financial products industry good, bad or indifferent for the US?

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In light of our strong economy beginning in Q2 2014 I would ask him how the Obama Council of Economic Advisers got so much wrong in December 2013? So keep in mind Q1 2014 was that awful winter and the price of oil started dropping in Q3 2014. So did the extended unemployment benefits and expanded SNAP undermine the job market? Is Keynesian stimulus limited by expanding welfare to able bodied adults without babies that should be in the labor force?? So here is the report from December 2013:

Failing to extend UI benefits would put a dent in job-seekers’ incomes, reducing demand and costing 240,000 jobs in 2014.
Estimates from the Congressional Budget Office and JP Morgan suggest that without an extension of EUC GDP will be .2 to .4 percentage points lower.
In 2011, CBO found that aid to the unemployed is among the policies with “the largest effects on output and employment per dollar of budgetary cost”
In over a dozen studies, economists have found that any disincentive to find new work that could result from extended UI benefits is, at most, small
Expiration of extended UI benefits may also lead some long-term unemployed to stop looking for work and leave the labor force, reducing the number who could eventually find jobs as the economy heals

https://obamawhitehouse.archives.gov/blog/2013/12/05/new-report-economic-benefits-extending-unemployment-insurance

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Ask if he calls you THE Tyler Cowen.

Steve

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what did you think of "A Crisis Wasted"?

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What was it like losing four elections in a row after Obamacare?
Did he really think the American middle class would sit still for a 200% rise in their medical premiums?
Why does Obama practiced scheduled diversity policy, dictating that we have to elect one of the gals?
What part did Obama play in the bankruptcy of Illinois? He started his career there, did he vote for the bankrupting policies?

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I’d be particularly interested in a discussion on teaching introductory economics. In particular:

What changes have Laibson and him made to Ec 10 since they took the class over at Harvard? The general public doesn’t know this yet!

What are his thoughts on the idea that introductory economics, in general, needs to be more empirical (from Noah Smith and others)?

How much should introductory economics emphasize modes of thinking over learning concepts in economics? To clarify what I mean—how much time should be spent, for example, on questions that make students think hard about their decisionmaking, reading articles like “A Fable of the OC,” trying to think about problems with an economic lens, thinking on the margin, and so on vs. learning how to draw supply and demand curves for different market structures, calculating demand elasticity, and so on?

How should instructors in any field try to ensure that students remember the content they learn and apply it in their lives? For instance, I remember Bryan Caplan, don’t remember where, talking about how many Econ 101 students would walk halfway out of a movie they don’t like (i.e., the sunk costs fallacy).

Similarly, Bryan Caplan thinks that voters, in general, suffer from “anti-market bias,” “anti-foreign bias,” “make-work bias,” and “pessimism bias.” Does he agree that these are the main problems with the common public’s understanding of economics? How should introductory economics adapt to these problems?

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He’s a prolific book reviewer on goodreads. You could probably find a lot of interesting stuff trawling through that.

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Because rich people who ignore the questions of poor people are losers.

Do what you think is best.

This is not off topic - when I think of Media Matters, I think of the way Lucianne Goldberg treated Monica Lewinsky, I think of Gawker and its take no prisoners approach to people they wanted to make feel bad, and I think of Vox Day and the Sad Puppies/Gamergate days trying to single out people they disagreed with for immense invective (on the side of conservatives) and that Dan Savage guy who tried to give the flu to the young people who worked on Gary Bauer's staff, in an illegal immoral way.

If you are reading this , Professor Cowen, trust me ---- I rarely flat out praise people ---- but I respect your commitment to intellectual inquiry, even though you do not have the legal education to understand that Roe v Wade was wrongly decided.

off topic - of course I have tried to get comments under the name of Efim polenov deleted. Thanks for usually getting it right as to which I wanted to be deleted (by the way you under-deleted rather than over-deleted. Trust me, don't trust the AIs who may or may not imitate me in the future). The glory years of that commenter are in the past.

Bonus trivia, as one of my favorite performance artists here says -

the glory years of James Joyce began at Sandyhas, Sandyhas, in Finnegans Wake, the last couple hundred pages of which are as much better than the usual Joyce prose as the usual Joyce prose is better than the usual prose of its day.

In the history of cinema, there are no directors ever who have directed more than ten films, of which more than five are worth watching more than half of. That is Sturgeon's law but with more details. There is one exception. Eric Rohmer.

And, of course, God loves us all.

Think of that every time you think of me because that is what my happiness, in the face of adversity, is based on.

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If you could go back in time and double the size of the stimulus, how would you spend the extra money and would difference would that have made?

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In his article with Summers, Furman talks about deficits and fiscal constraints. Does he ever consider the problem of spending money benefiting the current generation but requiring the next generation to pay. Seems like this is something that should be rare not commonplace.

https://www.piie.com/blogs/realtime-economic-issues-watch/further-thinking-costs-and-benefits-deficits

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Jason's Goodreads account is my favourite follow.

- Why does Jason read so much? Why does he think he reads more than others?
- What made Jason wish to share such thorough and insightful reviews with the public?
- Does Jason try to convince others to use Goodreads?
- What impact did reading Robert Alter's Torah translation have on him?

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