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GM chief pushes for higher gas taxes

By | June 8, 2011, 9:20 AM PDT

The push to raise the federal gas tax just got an unlikely supporter. General Motors Co. CEO Dan Akerson told the Detroit News that he wants the federal gas tax increased by as much as $1 a gallon to push drivers towards more fuel-efficient cars.

Akerson believes that the tax hike would lead to more people buying smaller cars, and that would be significantly more beneficial for the environment than forcing automakers to comply with higher gas-mileage standards.

“There ought to be a discussion on the cost versus the benefits,” he said. “What we are going to do is tax production here, and that will cost us jobs.”

Currently, federal officials are considering a 3-6 percent fleet wide fuel efficiency increase for automakers resulting in an average of 47 mpg to 62 mpg.

“You know what I’d rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas,” Akerson said.

“People will start buying more Cruzes and they will start buying less Suburbans.”

Of course, raising the gas tax is going to be incredibly difficult, considering our current political and economic climate, but it has been proven world over that people buy more fuel-efficient cars when gas prices rise.

According to a USA Today study, we’re currently paying the lowest gasoline taxes since the early days of the automobile.

Drivers are currently paying just $19 in gas taxes for every 1,000 miles driven. Taking inflation into consideration, that’s half of what drivers paid in 1975.

The current federal gas tax is at 18.4 cents per gallon (22 cents including state taxes) and hasn’t been raised since 1993.

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Ami Cholia

About Ami Cholia

Ami Cholia was a contributing editor for SmartPlanet in 2011.

Ami Cholia

Ami Cholia

Contributing Editor

Ami Cholia has written for AltTransport, Inhabitat, The Huffington Post and Sunday Mid Day in India. She holds degrees from the University of Texas at Austin and the Columbia University Graduate School of Journalism. She is based in New York.

Follow her on Twitter.

Ami Cholia

Ami Cholia

Ami does not have financial holdings that would influence how or what she covers.

She writes for SmartPlanet and is not an employee of CBS.

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+12 Votes
+ -
Great plan!
Let's see. We'll increase taxes on gas, which will naturally lead to a price increase for all transportation. Since the US primarily relies on trucks rather than trains for transportation (right or wrong - just the way it is), that means the price of everything goes up, causing inflation and further stagnating the economy.

Hmmm...maybe not such a great plan after all.
Posted by kylehutson
Updated - 8th Jun 2011
+8 Votes
+ -
Are you kidding? Unlikely supporter???
Hmmmm, let me see.. He actually works for a government-owned corporation and he suggests raising the fuel tax? I wonder where THAT revenue would go. Then there's the unmentioned probability that the profit margin on the Cruz is much higher per unit than on a 'Burb. States already have a problem getting back their "share" of the fuel taxes to maintain roads - the Fed imposes one heck of an "administration" charge...

Unlikely indeed...
Posted by GregGold
8th Jun 2011
+7 Votes
+ -
Taxpayer supported leeches
Let's see, they got a huge taxpayer bailout that overturned the idea of preferred stocks and common stock and rewarded the unions expensive labor, but that is not enough. Now we should raise gas taxes to nudge consumers (think Cass Sunstein) into buying cars very few want. What socialist utopia am I living in? What ever happened to the free market? Make cars people want and you won't need to nudge anyone. I could buy any number of 35 to 40 mpg cars for less than half the money of Volt and carry 5, not 4 people in it. Or I could commute to work on my motorcycle and save fuel. End GM's cooperate welfare now. Let them sink or swim in the market based on what they produce, not whose wallet they can pick.
Posted by philwhite42@...
8th Jun 2011
+6 Votes
+ -
Of course, because in the post-capitalist age...
...the entire purpose of taxation is to stimulate demand for favored corporate entities at the expense of non-favored entities, like individual citizens.

The marketplace for new "green" cars is going to be severely limited by the dwindling percentage of consumers able to afford one. The only upside to such self-serving pronouncements such as this is that it's becoming painfully clear to more people why the recession is going to continue indefinitely, and they will be voting correspondingly.
Posted by JohnMcGrew@...
Updated - 8th Jun 2011
+6 Votes
+ -
18.4 cents per gallon (22 cents including state taxes)???
I'm not sure where the author got these figures, but tax on gas is definitely more than 22 cents. Check the site: http://www.gaspricewatch.com/usgastaxes.asp for individual states and see that in most states there is an additional 20 - 30 cents added on top of the federal tax. I couldn't find ANY states that just added 3.6 cents to get to 22???

Has anyone ever wondered about the fact that while bashing the oil companies (and I'm certainly not defending any of them) the Federal Government actually makes a MUCH LARGER amount of money off of each gallon of gas than the Oil Companies do?
Posted by hground
8th Jun 2011
-4 Votes
+ -
I agree...
There are states pushing to make owners of electric cars pay special registration fees based on the fact that electric cars will cause a reduction in the revenue derived from taxes on gasoline. This is exactly the wrong way to go. I agree that if taxes on gasoline are increased, it will push people in the right direction - toward alternatives to gasoline. This is not just an economic issue, it's a national security one as well. Here's a recent statement by Saudi Prince Al-Waleed bin Talal - "We dont want the West to go and find alternatives, because, clearly, the higher the price of oil goes, the more they have incentives to go and find alternatives." Thanks, but I think I'll go find alternatives - I own a Chevy Volt...
Posted by blevblev
Updated - 8th Jun 2011
+1 Vote
+ -
Brilliant!
I foresee these electric cars littering junkyards everywhere after the warranty has expired and no one wants to throw $10k at a very used Chevy for batteries.

I estimate that your Volt will be shot long before you recoup the $20k premium ($30k if your batteries don't die within the warranty period) you paid over, say, a Corolla- which gets 42 mpg.

I commend your green efforts, I just think you made your move way too soon... undoubtedly electric/hybrid cars will become a good value. But right now, they're not.
Posted by ddferrari
10th Jun 2011
0 Votes
+ -
Paying for all the costs
Protecting foreign oil supplies is a primary mission of the armed services. 2010 Defense spending will be $685 billion. Gasoline burning vehicles are a primary source of air pollution & all the harm to health that comes from that. The federal gasoline tax generated $25 billion in 2006. So the indirect costs of gasoline come out of the general fund & out of our pockets.
Posted by hoodedswan
8th Jun 2011
+7 Votes
+ -
Where do you think the electricity comes from?
The wind and solar aren't powering your Volt. Fossil fuels are still supplying the energy. How far can the Volt go before the gas engine kicks in? 35 miles and that is only if it is above what, 26 or 28 degrees out. CR did an early report this spring on the Volt; it was under-whelming. They had to pay a $5000 premium to get one, which is what I just heard that the Prius is getting on top of the sticker price. Any small economy car would save you $10 to $30 thousand and will get you anywhere in this big country without having to plug in for 2 to 8 hours like an electric vehicle would. The premium price of these vehicles is a hefty smugness tax that many people see as a total waste of money. Tax policy should not be used to coerce anyone into buying a product that can't make it on its own.
Posted by philwhite42@...
8th Jun 2011
+2 Votes
+ -
And do note...
...that the "premium" paid for the volt is roughly the amount subsidized through tax credits.
Posted by JohnMcGrew@...
8th Jun 2011
0 Votes
+ -
RE: and do note
what a co-inkydink as 3 famous film stars used to say.....
Posted by GregGold
8th Jun 2011
+5 Votes
+ -
Only if money used for rebates
I am already willing to get a more fuel efficient vehicle. But I need 4 wheel drive for winter driving. I only have one car. I want a small fuel-efficient SUV for hauling stuff. I get about 23 miles per gallon on my 1999. 12 years later, the newer models get about the same gas mileage. So I'm not replacing mine until I can get something more fuel efficient or I have to replace my little SUV. What cars are among the biggest sellers? Trucks. So GM can claim it's us buyers, but there is nothing out there for me. Saturn was just bring them to market and now there gone.
Posted by Wifi-er
8th Jun 2011
-6
It all falls back on the Republicans again
Posted by gage927  |  Below your threshold
+2 Votes
+ -
RE: it all falls back
You perhaps don't realize just how small the UK is. You can drive coast to coast E/W in a day, N/S in a day and a half - or a day if you don't include Scotland. I don't suppose you know that about 90% of the fuel costs in the UK are taxes and go to subsidize all of the "green" stuff or that the UK is cruising around the white whirlpool even faster than we are.
Posted by GregGold
8th Jun 2011
+10 Votes
+ -
what a full blown blathering idiot!!
oh go ahead and raise the gas tax and send the economy back into a tailspin! The prices on everything else will skyrocket again because transportation costs will go up.
Posted by musicmikem@...
8th Jun 2011
-4 Votes
+ -
Agreed
It would be nice if the "free market" actually existed, to exert it's invisible hand in this case, but it doesn't. We have tax incentives for oil companies (and in the interest of full disclosure, I currently work as a consultant for an oil company) to drill, but really NO incentive for consumers to conserve. Every time the price of gasoline goes up, we hear a clamor from Congress to eliminate or suspend taxes on it, so it will stabilize at a lower price. In the '80s Reagan let energy conservation tax credits expire and "opened up" both natural gas development and the Naval Strategic Reserve to lower gas prices (which is a joke: the NSS would supply American energy needs for a month.) What happened? Did we all say "whew, that was a close one, let's develop energy independence!" No. We started making and buying SUVs, and using technology originally developed to more efficiently burn fuel (i.e. fuel injection) to give us faster cars. As the president of GE once remarked, "Why should I invest long-term in any energy technology based on a 15-minute price signal?" The "free market" in this case SHOULD be nudged to develop more fuel efficient cars INDEPENDENTLY from the "free market." It's an overall environmental and social good. Unless you don't believe in any of that tax incentive stuff, in which case we should eliminate the mortgage deduction, your IRS deduction for children, any allowance for the disabled, etc.
Posted by geodrone
8th Jun 2011
-4 Votes
+ -
"Need" an SUV?
I live in Canada, and I have exchanged an SUV for a small front wheel drive diesel wagon. I am a competent driver, so I don't "need" 4wd for the 2-3 months of the year where there is significant snow. I get 59 US MPG higway.

One must live in northern Minnesota or such to require an SUV.
Posted by dimonic
8th Jun 2011
0 Votes
+ -
duplicate entry
duplicate
Posted by philwhite42@...
Updated - 9th Jun 2011
+1 Vote
+ -
4 wheel drive
We can have snow from mid- Oct thru April. Ice storms have hit even in early May. Plowing is not that great, you see the difference just crossing the line into New Hampshire. Our Honda Pilot gets my 2nd shift nurse wife to work, plus can carry 7 passengers and gets 21 mpg on the highway. Sick people don't get snow days off. On the other hand, I'll ride my motorcycle to work when the weather is decent to save a little gas. Public transportation is not an option here and electric car would be impractical for the distances we have to drive to get anywhere.
Posted by philwhite42@...
9th Jun 2011
-3 Votes
+ -
Purchase a hybrid.
My Prius seats 5 (4 comfortably) and gets over 50 mpg and is great on ice and snow...uphill and down thanks to standard antilock brakes and traction control. One doesn't need a vehicle capable of carrying 7 people to go to work alone. My daughter is an RN living in Denver, CO and has a Honda Pilot but she doesn't use it to go to work. She uses it when the family goes on a trip or to transpot extra children to soccer practice.
Posted by garyncarol
Updated - 9th Jun 2011
+4 Votes
+ -
Pilot
We have 3 kids also, plus their friends. The car gets used. You can have your Prius, they seem to ride well, but I'll take the Pilot when needed. Besides, what I heard yesterday that there is a $5000 premium on Prius on top of the sticker price. Do I really want to pay over $30000 for it? No.
My wife was hit by a small car while in a mid-size SUV flying through a red light. She survived, the two in the smaller car didn't (the driver may have had a heart attack). She appreciates having the heavier vehicle, thank you.
Tax policy should not be used for social engineering.
Posted by philwhite42@...
9th Jun 2011
+8 Votes
+ -
Gas Tax
Look who is talking.. If GM had not been a sleep at the wheel and suggested this when gas was less that $1 a gal the price of gas would not be $4 a gal today.... They earned their bankruptcy but the Gov. would not let them have it... . There should be no GM today
Posted by buddycheek
8th Jun 2011
+8 Votes
+ -
Easy for him to say
GM's New CEO Daniel Akerson to Get $9 Million Pay Package
http://www.dailyfinance.com/2010/09/10/gms-new-ceo-daniel-akerson-to-get-9-million-pay-package/
Pay me $9m and I would agree to higher gas taxes. Of course Akerson has a company car with a driver so it's a mute point for him.
Posted by Hawaii Greenboy
8th Jun 2011
+11 Votes
+ -
Get him off his duff
He needs to get off his duff and MAKE some fuel efficient cars. How about a diesel-hybrid that gets 100mpg. Very doable. How about a Tesla style drive train on a small pickup? Small SUV?
Posted by Aboleyn
8th Jun 2011
+9 Votes
+ -
RE: Make some fuel efficient cars
You would not believe the cars and trucks that Ford/Mazda, Chrysler/Dodge and GM make in other markets - as in a Ford Ranger full crew cab with a 6' box, turbodiesel and 5 speed manual, goes and pulls like crazy, gets in the low 30's. GM and Chrysler/Dodge all make equivalent models. Could they make or have them here? Nope, our EPA, DOT and NTSB won't allow them here. The family sedans and small wagons abound, same manufacturers, can't get 'em here, same reasons.
Posted by GregGold
8th Jun 2011
+8 Votes
+ -
Boycott GM
Perhaps it's time to stop buying GM's. They want to ruin our economy just to make a buck after taking millions of taxpayers money! Not to mention they screwed over all the GM retirees while giving their CEO's pay raises. Don't support a company that tries to dictate how the government taxes it's people....
Posted by Tinman57
8th Jun 2011
+3 Votes
+ -
Gas TAX
What happen to the baby Duramax? 4.5L V8 if I can remember right and promissing 30+mpg????
the Baby Duramax could be put in the 1500 pickups and suburbans...
Then they won't be called gas guzzlers.
Thanks
Posted by dmaxws
8th Jun 2011
+6 Votes
+ -
Gas TAX
Dan Akerson is an idiot.
Posted by dmaxws
8th Jun 2011
+2 Votes
+ -
I spit and sputter in disbelief.
Quit offering the Suburbans, etc., or mark up the price to six figures on anything that averages less than 25mpg, and focus on fuel efficient vehicles. What about an article I read in Popular Mechanics or Science that the cost in pollutants to make the batteries and other materials for the Prius, and other electric vehicles, averaged out to the same or worse than a high mileage gas powered vehicle. I'm so disgusted with Dan Akerson and our current gov't. that I have trouble thinking coherently while I spit and sputter in disbelief.
Posted by DavBem
8th Jun 2011
+1 Vote
+ -
Sorry, but that just wouldn't work.
The problem is that the Suburbans and the like are their most profitable vehicles, and literally subsidize each and every "green" car. Without the Suburban sales, the "green" cars would be even less affordable.
Posted by JohnMcGrew@...
9th Jun 2011
+5 Votes
+ -
I would love one but...
I would love to have a nice new energy efficient vehicle. However my income keeps me in my old 1994. There are a lot of us out there that buying a new car even if it was very efficient and save money, would be unaffordable. Raise the taxes on gas and it will hurt the poor even more.
Posted by halomar1970
8th Jun 2011
+7 Votes
+ -
This is rich...
First, perhaps it should be noted that there are other reasons to buy a car than just gas mileage. Not everyone purchases a vehicle solely for the purpose of commuting to work every day. "Fuel efficient" vehicles are not good family cars (there are some family cars that are decent, but they don't qualify for either side of the tiny car vs. SUV debate), they do not haul equipment or anything else (animals, feed, mulch, supplies for home renovation, furniture from the garage sale a mile down the road, etc), they make lousy farm vehicles, they don't tow things well (trailers with anything on them you can imagine: generators, lawn mowers, yard waste, livestock, etc), they don't move large groups of people (especially if luggage or gear is involved), and the list goes on. Raising the gas tax doesn't eliminate the need for these things in our society, it just makes it all more expensive. Remember that the next time you see one of those large power trucks going down the street... or an ambulance or firetruck. A gas tax does not selectively target those who drive SUVs even though they could afford a hybrid, it hurts (HURTS) everybody (EVERYBODY).

Secondly, the entire infrastructure of the United States is built on fossil fuels, like it or not. Innovation can result in a transition from our current infrastructure to another one, but taxing that which the infrastructure is built on will not (WILL NOT). Innovation requires money, and so does the purchasing of these innovations by the general public. Taking their money away from them by making it more expensive for them to live their lives does not in any way help (not under any stretch of the imagination). If there is to be any switch from dependence on oil to some other form of transportation, then it must be done by innovation in the free market. If there is no free market (as some have suggested), or if there is no innovation to be had (as has also been suggested), then instead of stealing the money from those who need it in order to make the transition, a reward could be posted for a certain level of innovation. This worked marvelously in the X-Prize competition a while back, and it could work very well again. Taxing and subsidizing do not really solve any problems, other than making our inept government look important.

Make the tech appealing and people will buy it. If you don't like one of your products being on the market, stop making it. If you want to sell more of a product, drop the price. These are capitalistic ways of dealing with things. Not only are they traditional, they are sound economic principles, and they don't cost anyone a dime (except for the company in question). Perhaps that is the real issue. Gas mileage regulations would cost the auto companies money, both in R&D and reworking their product line. A tax, on the other hand, would cost us money and (so they say) bring in more business for the auto companies. Are they really thinking about the green of the planet, or the green of their pocketbooks?
Posted by artoo36
8th Jun 2011
0 Votes
+ -
Exactly!
You said it so beautifully!
Posted by llamasaki
15th Jun 2011
+3 Votes
+ -
gas taxes
The CEO makes over how many 6 figures a year or more!! Higher prices wont bother him at all !! All he cares about is selling more cars and making more money! Besides all the other items that would drastically raise prices because of the tax. Basic necessities like food comes to mind first!! Where is this guy coming from! Just the green in there wallets!
Posted by sandrail43@...
8th Jun 2011
+5 Votes
+ -
Bald headed moron
Why doesn't he pay back the $14 billion he owes us and keep his mouth shut til then. What a totally incompetent fool and the reason I will never purchase a gm vehicle ever again.
Posted by dguith
9th Jun 2011
+6 Votes
+ -
GM chief pushes for higher gas taxes
We bail out GM at our expense then they want to stab us in the back. I think that CEO Dan Akerson has lost his mind. Let???s see raise the gas tax so that gas cost more, driving up the cost of ALL products that we have to buy. What about the people that are working for minimum wages that can't afford gas now. So we should all buy a new car to help bolster GM that will get minimally better gas mileage than what we have now. GM wants to boost sail I have a better idea. Fire CEO Dan Akerson and lower the cost of your cars. I have always been a huge GM customer but not anymore. You will not see another new GM in my driveway.

Hey CEO Dan Akerson why don't you cut your salary down to minimum wage for the next two years and try to live off of it. Try to live like regular people do. You are a total fool.
Posted by jtalbot@...
9th Jun 2011
+4 Votes
+ -
Government Motors CEO
What else would you expect to come from the mouth of the Government Motors CEO. Lets tax the people into submission. Forget people driving the market. Make the government drive the market. This man obviously makes too much money to care about the cost of gas. If it costs one hundred dolloars a gallon for gas, it just means he would experience less trafic as he drives down the road.
Posted by dlayne@...
Updated - 9th Jun 2011
+2 Votes
+ -
Ummm... DERP
Really? I want whatever this guy's smoking...
DERP!
Posted by jmwells21
9th Jun 2011
+6 Votes
+ -
Just shoot the economy now.
Moron. This is what happens when academics using classroom theory run things.

Guess what buddy? I just bought a Hyundai because GM's are junk.
Posted by Hates Idiots
9th Jun 2011
-6
Why not a larger Federal tax increase?
Posted by garyncarol  |  Below your threshold
+4 Votes
+ -
Because it's punishing the wrong people, that's why
@garyncarol: if you keep speaking without thinking or educating yourself, you become part of the problem.

Firstly, raising fuel taxes increases everyone's cost of living. Since many of us are already struggling in the current economy just to keep our families alive, the additional taxes that have already been imposed are turning our recession into a depression.

With respect to the fuel tax, its effect is being multiplied in higher food and utility prices. Families are already having to make the decision on what necessities to cut out because, with the breadwinners having to travel farther for jobs, their budgets can't absorb the extra work-related costs that higher fuel prices are already inflating. Lest ye forget, skyrocketing fuel prices were the final trigger to our current economic mire.

Secondly, our infrastructure isn't outmoded, unless you don't live in the real world. We are a nation that runs mostly on petroleum-based surface transportation and our people, goods, and services must travel. There is no viable alternative energy. I wish there were, but nothing is even close to production that can replace what we've got.

All subsidies should be terminated. So should most taxes. The only thing fuel tax should be used for is infrastructure maintenance. Higher fuel prices disproportionately punish those who can least afford them. And the taxes raised don't get used for transportation - they get used to push socialist agendas.

I favor incentives (breaks, not subsidies) for improving fuel economy, not disincentives just because some disconnected talking puppet head has been told to spout liberal propaganda.

Remember hearing about something called "the American dream"? It's creeps like Obama, our liberal congress, and unionized goons like Akerson who are killing it. Without debunking the crap our lamestream media is force-feeding us, we'll keep believing that causing problems actually fixes them.
Posted by Suncat2000
9th Jun 2011
0 Votes
+ -
RE: Federal Tax Increase
wouldn't work...the states have a heck of a time getting back even 50% of what they collect for the fed, the "admin" fee would just go up. We'd never get it back...
Posted by GregGold
13th Jun 2011
+6 Votes
+ -
Taxes
There is nothing stopping you from sending extra tax money to the Treasury if you'd like. Just don't try and coerce others with your regressive tax policies into buying what you feel the rest of us should own.
Posted by philwhite42@...
9th Jun 2011
+5 Votes
+ -
Dan Akerson
He looks like a $500 suit and a $50 tie. He ought to just eat **** and die.
Posted by dewey56
9th Jun 2011
0 Votes
+ -
incremental change
there does not have to be a trade off between efficiency and driving a too small to be comfortable car. make all vehicles efficient with existing technology.

for example

utilizing engine management so that when idling in traffic, only one or two cylinders is firing, the rest are not needed for idling.

two layer windshields to reduce a/c and heating loads (insulation reduces energy and hence fuel usage).
Posted by IBM bluesky
9th Jun 2011
+1 Vote
+ -
Everyone has appoint
If I could afford to go to a more fuel efficient Durango I would but like most everyone in middle class, you can what you can afford and that is cars under $8,000 or less because the other bills come first. Maybe he should be looking at how to get those who can not afford these price tinker toy cars into a fuel efficient engine in the ones they have. What happen to the $2,000 fuel efficient motor for older model cars?
Posted by Orchid de Noir
10th Jun 2011
-3 Votes
+ -
Bah!
I laugh but it's sad seeing all the short term, reality ignoring thinking going on here.

Petroleum production has for all practical purposes reached a peak and demand will continue to rise. The sooner we wean ourselves off of petroleum for transportation fuel the better off we all will be. Raising the gas tax is a price signal that helps do that.
Posted by riverat1
10th Jun 2011
0 Votes
+ -
must be nice to be wealthy
The reality here is that the poor (who FAR outnumber the wealthy) cannot AFFORD the overpriced, somewhat more fuel efficient American cars being sold new. Neither can they afford another price hike in gas prices like this. Did you know that people lose their jobs to higher gas prices? No gas in the car, can't get to work (we don't all live in big cities with good mass transit), no job, no paycheck, not buying a Volt this year.
Posted by llamasaki
15th Jun 2011
+3 Votes
+ -
This guy is out of touch with reality
Look at GM and I'll show you a company that pretty much proved you can ruin anything if you just work hard enough at it. If this guy thinks that raising taxes will make me buy a new car, he must think we all sleep on mattresses stuffed with money. The more money that's taken away from me, the less I have to spend. Now how could I afford one of his poor quality cars that's horribly overpriced if you keep taking what little money I'm now left over with as we're taxed to blooming death? This guy needs another raise. Oh, I know - he'll get it. It's the rest of us that are taking pay and benefit cuts.
Posted by bobinmo1
10th Jun 2011
+3 Votes
+ -
GM has repeatedly proven it has no expertise
in financial matters, so why does the CEO think anybody is going to take his financial proposals seriously?
Posted by Allen.
10th Jun 2011
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