Archive for November, 2009

Evans Politics, November 30, 2009

 

As Treasury Department Stumbles,
Liberals Push Tougher Measures to Stem Foreclosures

 

As Treasury Department Stumbles, Liberals Push Tougher Measures to Stem Foreclosures, Truthout, November 30, 2009, by Art Levine, cartoon by Dave Granlund used with permission, quoted verbatim:

With today’s scheduled announcement by the Treasury Department of new efforts to pressure lenders to lower mortgage costs, progressive economists, advocacy groups and legislators are pushing for tougher measures to keep homeowners in their homes – and to force banks to take losses on their exploding mortgages.

In contrast, the Obama administration’s response to a crisis that is causing two million families a year to face the loss of their homes has been widely derided as ineffective. The programs so far have been voluntary plans that proved too costly for homeowners, too cumbersome for all parties involved and have offered few effective incentives. As a result, only a tiny fraction of homeowners at risk of foreclosure – as little as 3 percent for some programs – have been helped in any way.

well known cartoon of the sadness of homes with foreclosure signs at Christmas time

Yet the administration instead is going to focus on a new drive to “shame” the shameless bankers and financial institutions that have already gouged trillions in bailouts and guarantees from the taxpayer. This is the same industry that has also torpedoed or weakened mortgage and financial reforms in Congress. Still, the New York Times reported:

“The banks are not doing a good enough job,” Michael S. Barr, Treasury’s assistant secretary for financial institutions, said in an interview Friday. “Some of the firms ought to be embarrassed, and they will be.”

Mr. Barr said the government would try to use shame as a corrective, publicly naming those institutions that move too slowly to permanently lower mortgage payments. The Treasury Department also will wait until reductions are permanent before paying cash incentives that it promised to mortgage companies that lower loan payments.

“They’re not getting a penny from the federal government until they move forward,” Mr. Barr said.

Liz Ryan Murray, the policy director for National People’s Action, a network of community advocacy groups, said bluntly of the announcement, “It’s a joke. There’s still no talk of reforming the program, or using TARP money to bail people out. It’s just a plan to make servicers feel bad.”

And as Dean Baker, co-director of the Center for Economic and Policy Research and a proponent of a “right-to-rent” approach to aid at-risk homeowners, told Truthout, “We need to change the law rather than haranguing lenders. When someone’s running drugs, we don’t try to shame them – we put them in jail.”

Unfortunately, getting tougher on crooked lenders – then and now – doesn’t seem to be a priority, either. Some reform-minded legislators, especially Ohio Democrat Marcy Kaptur, have contended that homeowners should stay in their homes in part because many of the loans were fraudulent and deceptive. In addition, she’s been seeking additional law enforcement resources devoted to prosecuting lending fraud. As she told The Nation recently:

“Mortgage fraud is at the heart of the housing crisis, which is at the heart of the financial crisis. After 9/11, the FBI redeployed financial special agents to anti-terrorism, but they have yet to replace those agents in the White Collar Crime Division – even though the division had warned in 2004 of the threat of a mortgage fraud ‘epidemic.’ We were under the understanding that [the Department of] Justice was under 200 prosecutors and investigative agents in the area of mortgage and securities fraud, and so we were pushing to increase that number. Our goal was 1,000 agents – we didn’t come anywhere near close to that – but 1,000 agents is the number that were in place during the savings and loan crisis back in the late eighties.”

Equally troubling, in the absence of any real mortgage reform, is the spread of bogus foreclosure-assistance companies that are stealing yet more money from homeowners under the guise of renegotiating their mortgages.

Even as criminal lenders and scam artists remain unpunished, the program the administration is hoping to salvage has several built-in flaws that could doom its ability to help the millions needing it – especially with one in four homeowners now owing more than their homes are worth. That’s a sign of potential foreclosures to come. For instance, as Dean Baker and other experts point out, the HAMP initiative was designed for employed homeowners who were victimized by predatory, subprime loans they just couldn’t afford to pay in full. It excludes today’s struggling homeowners who are unemployed and who are “underwater,” faced with paying off a mortgage that is worth far more than the house’s now-collapsed value. “If you owe $300,000 on a house that’s worth $200,000,” Baker notes, “the banks won’t write down that much.”

The government’s weak incentives so far – and verbal tongue-lashings being promised today – aren’t likely to remedy this crisis. It’s not just that it took quite a while for Treasury Secretary Tim Geithner’s department to realize it wasn’t such a bright idea to essentially pay all the renegotiating incentive money up front to financial institutions still determined to kick people out of their homes. On top of that, the amount of fees that mortgage companies can generate by servicing delinquent loans often exceeds the incentives the government offers out of its floundering $75 billion program. As the New York Times reported back in July, “Many mortgage companies are reluctant to give strapped homeowners a break because the companies collect lucrative fees on delinquent loans.” The paper noted:

Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue – fees for insurance, appraisals, title searches and legal services.”

The lack of meaningful pressure on financial institutions to either increase lending or renegotiate mortgages has hampered everything from the wasteful $700 billion TARP bailout to the bungled foreclosure programs.

As I had earlier reported in In These Times, and widely noted by everyone from the New York Times to the Congressional Oversight Panel on the TARP program, the current programs have flopped so badly they’ve only reached – let alone permanently helped – as few as 3 percent and, at best, less than half of eligible homeowners.

The programs include a now-abandoned fiasco in HUD that only aided a few hundred homeowners in its early months, and the better-known “Home Affordable Program” (HAMP) and a related refinancing effort in Treasury that have offered permanent aid to only a few thousand homeowners. As The New York Times reported Sunday:

From its inception early this year, the Obama administration’s program, called Making Home Affordable, has been dogged by persistent questions about whether it could diminish a swelling wave of foreclosures. Some economists argued that the plan was built for last year’s problem – exotic mortgages whose payments increased – and not for the current menace of soaring joblessness. Lawyers who defend homeowners against foreclosure maintained that mortgage companies collect lucrative fees from long-term delinquency, undercutting their incentive to lower payments to affordable levels.

Last month, an oversight panel created by Congress reported that fewer than 2,000 of the 500,000 loan modifications then in progress had become permanent under Making Home Affordable. When the Treasury releases new numbers next month, it is expected to report a disappointingly small number of permanent loan modifications, with estimates in the tens of thousands out of the more than 650,000 borrowers now in the program.

Yet another program in Treasury is even more of a failure, if that’s possible. As The Washington Post reported last month:

A seven-month-old government program to help homeowners with little or no equity refinance their mortgages has so far reached fewer than 3 percent of those targeted, with many struggling borrowers deciding that the benefits of a new loan aren’t worth the closing costs.

This lackluster performance reflects the difficulty of helping the growing segment of “underwater” homeowners – those who owe more than their home is worth.

The program is a key component of the Obama administration’s efforts to stabilize the housing market and arrest the nation’s growing foreclosure rate. But the initiative has received far less public attention than its companion, a loan modification program that pays lenders to lower the payments of delinquent borrowers who are in imminent danger of losing their homes.

The refinancing program targets borrowers who are not in trouble on their mortgage now but, because they are underwater, are at risk of falling into trouble later.

Dean Baker and other reformers, including leaders of theNational People’s Action advocacy network and the Center for Responsible Lending, are promoting what could be better ideas. They aim unabashedly to keep homeowners in their homes and force financial institutions to take losses on their loans, but so far there has been little Congressional or administration action on them. Nor are Washington insiders willing to take on the financial industry on this issue, even as they’re trying to pass often loophole-laden financial reforms against a lobbying blitzkrieg by Wall Street.

Baker’s right-to-rent proposal, he argues, offers benefits that even other reform ideas don’t necessarily provide. For instance, earlier in the spring, a law designed to spur “cram-down” decisions by judges to force lower mortgage payments failed in the Senate after passing the House. Senator Dick Durbin (D-Ill) said of the fierce financial industry lobbying that defeated the bill: “Frankly, they own the place.” Yet Baker’s approach to allow homeowners to pay fair-market rent rates doesn’t depend on hoping that a bankruptcy judge after a drawn-out process will finally give a homeowner a break.

Nor does Baker’s proposal require an elaborate bureaucracy, armed with fee incentives, to prod profit-driven mortgage service companies to lower required mortgage payments. “It doesn’t involve the taxpayers’ money and it doesn’t involve a bureaucracy,” he notes. “You don’t need a bureaucracy to guarantee that people can stay in their homes.” Yet while it’s costly to neighborhoods and even to banks to have homes remain empty without a sale after families are forced out, banks are still counting on either government guarantees or the market’s rebound to make it worth the wait to resell the homes, rather than take any losses.

So, as with other reforms, “the banks hate it,” Baker admits.

As previously reported in In These Times, reform groups are offering a wide-ranging agenda for mortgage relief that is largely being ignored. For instance, at its Save the American Dream web site and in other materials, National People’s Action has outlined the basic principles of reform, including fixing HAMP. Few of them appear to be on their way to being effectively implemented:

IMMEDIATE RELIEF TO KEEP FAMILIES IN THEIR HOMES
Mortgage industry must:
• Disclose ownership of loans before foreclosure.
• Modify loans to be permanently affordable.
• Halt massive interest rate hikes.
• Allow servicers the greatest flexibility to modify these loans.
• Create a refinance loan for homeowners stuck in unaffordable loans.
• Employ salaried loan officers, not commissioned-based loan officers.

The Treasury Department Must Dramatically Improve HAMP

Servicers must be pressured to increase dramatically the number of permanent modifications being made.

Treasury must mandate principal reduction as a primary tool to solve foreclosures, not just as a last resort.

HAMP cannot be a ‘one-strike’ program. Families need the ability to reapply to the program if and when their situations change.

Treasury must make the HAMP process more transparent and implement a true appeals process so families in foreclosure can see how to qualify and have recourse if they are rejected by their servicer.

Instead of such tough-minded reforms of current practices, the administration is instead primarily relying on “shame” to prod the financial services industry to change its ways and save homeowners. As former Labor Secretary Robert Reich declared on his blog Sunday:

The $75 billion federal program designed to bribe banks to modify mortgages has been a bust. No one knows the exact number of mortgages that have been modified (that will be reported next month) but housing experts I’ve talked with say it’s a tiny fraction of the number of homeowners in trouble. Seems that the big banks can’t be bothered. “Some of the firms ought to be embarrassed,” Michael Barr, the assistant Treasury secretary for financial institutions told The New York Times. Barr says the government will try to use shame as a corrective, publicly naming institutions that have moved too slowly.

Shame? If we’ve learned anything over the last year, it’s that Wall Street has none. Eight months ago Wall Street lobbyist beat back a proposal to give bankruptcy judges the right to amend mortgages in order to pressure lenders to reduce principal owed, just like Wall Street lobbyists are now beating back tough regulations to prevent the Street from causing another meltdown. Goldman Sachs, attempting to pre-empt a firestorm of public outrage when it dispenses its $17 billion of bonuses, is setting up a crudely conceived $500 million PR program to help Main Street.

Shame won’t work. Only political muscle and courage will.

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Afghanistan: Our 177th Colony

Author: Paul
11.30.09

Evans Politics, November 30, 2009

 

Afghanistan: Our 177th Colony

 

Afghanistan: Our 177th Colony, OpEdNews, November 30, 2009, by David Swanson, quoted verbatim:

For OpEdNews: David Swanson – Writer

During a televised football game on Sunday, an announcer welcomed the members of the U.S. military viewing the game in 177 nations around the world. When the news came on, the topic was the same one it’s been for weeks, speculation as to whether and how much a single individual will escalate war by sending tens of thousands of additional troops to nation number 177, Afghanistan.

Somehow it remains eternally controversial to mention the imperial presidency. Yet the positions on Afghanistan in the United States are limited to “The President should escalate the war,” “The President should not escalate the war,” and “The President should do whatever he wants.” Some people have other things to say on the topic, but almost nobody refuses to hold one of those three positions.

One of the few holdouts is a document rather than a person, a document known as the U.S. Constitution. The funny thing is that the people who wrote this document over two centuries ago very intentionally and explicitly created a legislature with the power and duty to decide when and where to fight wars, to raise the funding to pay for them, and to oversee the military. The executive was to execute the will of the Congress, including in his duty as commander in chief of the military.

The wisdom here was not just in giving the power to decide on wars, and the extent of those wars, to a different branch of government than the commander in chief, while nonetheless giving him (or her) civilian command of the military. The wisdom extended to giving the legislature the power to decide virtually everything else, what laws to make in any area and, in every area, what money to raise or spend.

Representatives were to represent relatively small numbers of people. Their constituents, it was expected, might be able to persuade them to act on behalf of majority opinion. The idea of the entire nation lobbying the executive is almost laughably more challenging, even without considering the problems with lobbying an executive to make decisions only Congress is constitutionally able to make, not to mention decisions on whether to engage in massive crimes forbidden by treaties to which our nation is a party.

But Congress is in such bad shape that many people have had many years to learn that their permanent-incumbent representative is virtually immune to public influence. Meanwhile, the president is new, and his vague advertising campaign has left him open to wishful misinterpretation. Plus, he’s a member of the good team.

If President George W. Bush had called something serving 2 to 5 percent of Americans a “public option,” MoveOn.org would have attacked him for deceiving the country. When Obama does that, all the activist groups celebrate his public service. When Bush continued and escalated wars, the more principled peace groups told the House of Representatives to deny him the money. After 11 months, we are just beginning to drag a few of the better peace groups partially away from their lobbying of the new emperor, in order to work on denying the money.

I recently read an excellent book called “The Vanishing of a Species?” which Peter Gretener wrote, for the most part, 30 years ago, but which his family just published posthumously. This book looks at the fate of our species in as wise a way as anyone has in the generation since it was written. It examines, among other things, the question of whether humans are aggressive due to nature or nurture, and whether this aggressiveness must expand with the greater density of humans caused by population growth. But Gretener never considers the possibility of a government misrepresenting its people, of people outgrowing aggressiveness but their government nonetheless attacking others.

Gretener believes that human wisdom has not kept pace with human technology, thus creating the possibility of economic and environmental collapse. I believe, on the contrary, that human wisdom has declined rather than holding steady. We’ve lost the ability to live sustainably or peacefully. And we’ve lost the understanding of how governments can be structured to check our inevitable abuses.

David Swanson is the author of the new book “Daybreak: Undoing the Imperial Presidency and Forming a More Perfect Union” by Seven Stories Press. You can order it and find out when tour will be in your town: http://davidswanson.org/book.

Take action — click here to contact your local newspaper or congress people:
Out of Afghanistan and Iraq Now

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Evans Politics, November 30, 2009

 

Lobo ‘wins’ fraudulent Honduran presidential election (video)

 

Al Jazeera English video from Nov. 30, 2009, text quoted verbatim:

“Porfirio Lobo, a right-wing businessman and rancher, has been declared the president-elect of Honduras in a vote held after months of tensions following the overthrow of Manuel Zelaya in a military-led coup.

“Roberto Micheletti took over as interim president in June, claiming that Zelaya was trying to change the constitution to allow him to stay in power. The coup saw thousands of supporters on both sides take to the streets – while the two men tried to negotiate a peaceful outcome.

“Neither Zelaya nor Micheletti stood in Sunday’s presidential vote, which pitted Lobo against Elvin Santos, Zelaya’s former vice-president.

(Lobo’s supporters claim a large turnout, while Zelaya’s supporters claim there was mass boycotting of the election. The European Union and the Organization of American States refused to monitor the polls, probably out of protest, but there were around 300 observers. Evans Politics feels it is wrong of the U.S. to recognize Lobo’s government, since the elections may be considered illegal by some legal considerations. Zelaya was never allowed to finish out his constitutionally mandated term of office, while the U.S. stood by with pitifully minor sanctions against the right wing group that usurped power and deposed Zelaya. ~ Paul Evans)

“The decision by the US to support the vote’s result has infuriated Zelaya’s supporters, who say that Washington has backtracked on its previous statements condemning the coup.

“From Tegucigalpa, Lucia Newman reports.”

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Evans Politics, November 30, 2009

 

Iran to Defy UN Uranium Freeze (Video)

 

See Iran rebuked over nuclear ‘cover-up’ by UN watchdog (article and videos), Evans Politics, November 8, 2009, news from BBC and Al Jazeera, with commentary by Paul Evans.

CBS News video – Nov. 30, 2009 – 1:19

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Evans Politics, November 30, 2009



Inspirational thoughts for our work week



Evans Politics, November 30, 2009 (a repeat from August 14), compilation by Paul Evans:

The best time to plant a tree was always 20 years ago. The second best time is always today. ~ old Chinese saying

Destiny is not a matter of chance, It’s a matter of choice;  It’s not a thing to be waited for, It’s a thing to be achieved. ~ William Jennings Bryan

When you know what you want, and you want it badly enough, you’ll find a way to get it. ~ Jim Rohn

In the middle of difficulty lies opportunity. ~ Albert Einstein

The only limits are, as always, those of vision. ~ James Broughton

an inspirational photo of a pair of hands with butterflies fluttering about

“Someone once asked me why do you always insist on taking the hard road? and I replied  why do you assume I see two roads?” ~ unknown

Success usually comes to those who are too busy to be looking for it. ~ Henry David Thoreau

Argue for your limitations and sure enough they are yours. ~ Richard Bach

“Adversity causes some men to break; others to break records.” ~ unknown

Success seems to be largely a matter of hanging on after others have let go. ~ William Feather

A man can succeed at almost anything for which he has unlimited enthusiasm. ~ Charles Schwab

Challenges are what make life interesting; overcoming them is what makes life meaningful. ~ Joshua J. Marine

The thing always happens that you really believe in; and the belief in a thing makes it happen. ~ Frank Lloyd Wright

I’m a great believer in luck, and I find the harder I work the more I have of it. ~ Thomas Jefferson

He is the most unfortunate who’s today is not better than yesterday. ~Muhammad (PBUH)

“Success can never be controlled, but performance always can.” ~John F. Murray

“If you are not big enough to lose, you are not big enough to win.” ~Walter Reuther

“Never stand begging for what you have the power to earn.” ~ unknown, may sound a little like Republican propoganda, but there you have it….

There are two ways of meeting difficulties:  you alter the difficulties, or you alter yourself to meet them. ~Phyllis Bottome

“Many of life’s failures are people who did not realize how close they were to success when they gave up.” ~ unknown

“Success is how high you bounce when you hit bottom.” ~ unknown

You always pass failure on the way to success. ~Mickey Rooney

Whenever I hear, ‘It can’t be done,’  I know I’m close to success ~ Michael Flatley

Without a sense of urgency, desire loses its value. ~ Jim Rohn

“God gives every bird it’s food, but does not always drop it into the nest.” ~ unknown, but I’d read his book!

Kites rise highest against the wind not with it ~ Sir Winston Churchill

“To make yourself exceptional is the biggest achievement of your life.” ~ unknown

an inspirational photo taken from the ground looking up, of very tall aspens reaching toward the sun

No one can make you feel inferior without your consent.  ~ Eleanor Roosevelt

I have the audacity to believe that peoples everywhere can have: three meals a day for their bodies, – education and culture for their minds – and dignity, equality and freedom for their spirits. — Dr. Martin Luther King, Jr.

There are two ways to live: you can live as if nothing is a miracle; you can live as if everything is a miracle.” — Albert Einstein.

On political activisim: If you think you’re too small to be effective, you’ve never been in the dark with a mosquito.” — source unknown.

Given to us by GreenSooner over at DailyKos: “Policies that were wrong under George W. Bush are no less wrong because Barack Obama is in the White House.” – Bob Herbert

To be what we are, and to become what we are capable of becoming, is the only end of life. ~ Robert Louis Stevenson

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Your Abbreviated Pundit Round-up

Author: Paul
11.30.09

Evans Politics, November 30, 2009

 

Your Abbreviated Pundit Round-up

 

Your Abbreviated Pundit Round-up, Daily Kos, November 30, 2009, by DemFromCT, quoted verbatim, used with permission:

Paul Krugman:

You might think, then, that doing something about the employment situation would be a top policy priority. But now that total financial collapse has been averted, all the urgency seems to have vanished from policy discussion, replaced by a strange passivity. There’s a pervasive sense in Washington that nothing more can or should be done, that we should just wait for the economic recovery to trickle down to workers.

This is wrong and unacceptable.

Ross Douthat:

But the study shouldn’t make liberals too cocky. The authors find that growing up in a recession can encourage conservative instincts as well. Downturns make young voters distrustful of unfettered capitalism, yes. But they also make them less confident in the federal government.

So far, it’s also making people distrust Republicans. But the biggest hit is going to be on incumbents.

WaPo:

In a new Washington Post poll, Palin beats other GOP leaders on two questions: who best represents the party’s core values, and who Republicans would vote for if the presidential nomination battle were held today. But she has particular appeal to the loyal followers of Limbaugh and Beck, two of the most popular conservative talk show hosts in the country.

As if there’s any doubt…

WaPo:

Opposition to President Obama and his policy initiatives is strong, but Republicans are split on GOP’s direction, leaders.

The argument: “Go right. No, go more right.” Only Republicans can save Democrats from being Democrats.

Robert J. Samuelson: Leave the Fed alone. And while you’re at it, get the government out of regulation. Nothing’s changed, now go away.

NEJM:

Six months have passed. Flu season is now here. After repeated delays, H1N1 vaccine finally arrived in our clinic earlier this month to the uniform relief of the medical staff. But my formerly desperate patients were now leery. “It’s not tested,” they said. “Everyone knows there are problems with the vaccine.” “I’m not putting that in my body.”

I was unprepared for this response, but maybe I shouldn’t have been. For weeks now, in the schoolyard of my children’s elementary school, other parents had been sidling up to me, seemingly in need of validation. “You’re not giving your kids that swine flu shot, are you?” they’d say, their tone nervous, if a bit derisive.

How to explain this dramatic shift in 6 short months? It certainly isn’t related to logic or facts, since few new medical data became available during this period. It seems to reflect a sort of psychological contagion of myth and suspicion.

Just as there are patterns of infection, there seem to be patterns of emotional reaction (“emotional epidemiology”) associated with new illnesses. When 2009 H1N1 influenza was first detected, it fit a classic pattern that Priscilla Wald recently outlined in her book Contagious [1]: It was novel and mysterious; it emerged from a teeming third-world city, and it was now making its insidious — and seemingly unstoppable — way toward the “civilized” world.

COMMENT by Paul Evans: DemFromCt, as a succesful trauma surgeon as well as something of an epidemiologist with his FluWiki sites, seems unable to understand the public’s fears about the flu vaccine. To simply deny that problems exist with these vaccines seems wrong to me, but as someone trained in science, I do understand his point of view. There just are concerns that won’t go away, such as the very controversial link between the mercury containing Thimerisol, a component of some of the vaccines, which has been linked to autism… See Swine Flu Jab Linked to Killer Nerve Disease: Leaked Letter Reveals Concern of Neurologists over 25 Deaths in America, Mail Online (U.K.), August 15, 2009, by Jo McFarland: 500 cases of “a brain disorder called Guillain-Barre Syndrome (GBS), which could be triggered by the vaccine” detected. Letter sent to 600 neurologists.

Balanced against these concerns with the vaccine is the simple fact that in an “average” year, the common flu kills some 35,500 Americans, and the “swine flu” or H1N1 flu is a new variety that is mutating around the world – and so could turn into something much worse. Take your shots.

*****

DemFromCT is a longtime member of the Daily Kos community with interests ranging from polling to Iraq to bird flu, and has graciously agreed to allow us here at Evans Politics to republish his articles on an ongoing basis. He is a founding editor of Flu Wiki (www.fluwikie.com) and its sister site, the Flu Wiki Forum (www.newfluwiki2.com). Since its inception in June 2005, Flu Wiki has grown into an international clearinghouse of pandemic influenza information and links.

You can view his diaries (blogroll) at Daily Kos, here. DemFromCT is a featured writer at Daily Kos, and you can read more about him here.

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Evans Politics, November 29, 2009

 

Howard Dean: 1 Trillion Dollar Healthcare Nightmare

 

Video from November 25, 2009

* Bernie Sanders, others, say Public Option or ‘No’ vote.
* Insurance ‘would cost sick 2 to 3 times what healthy would pay’
* Dean: ‘This bill does nothing to control costs’

 

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