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Canada Businesses The Almighty Buck Technology

Another Universal Basic Income Experiment is Underway, This Time in Canada (technologyreview.com) 403

Posted by msmash from the further-exploration dept.
Lindsay, a compact rectangle amid the lakes northeast of Toronto, is at the heart of one of the world's biggest tests of a guaranteed basic income. Technology Review: In a three-year pilot funded by the provincial government, about 4,000 people in Ontario are getting monthly stipends to boost them to at least 75 percent of the poverty line. That translates to a minimum annual income of $17,000 in Canadian dollars (about $13,000 US) for single people, $24,000 for married couples. Lindsay has about half the people in the pilot -- some 10 percent of the town's population. The report outlines that the Canadian province's vision for a basic income -- and the underlying experiment -- differs from that of the one we have seen in Silicon Valley. The report continues: The Canadians are testing it as an efficient antipoverty mechanism, a way to give a relatively small segment of the population more flexibility to find work and to strengthen other strands of the safety net. That's not what Silicon Valley seems to imagine, which is a universal basic income that placates broad swaths of the population.

The most obvious problem with that idea? Math. Many economists concluded long ago that it would be too expensive, especially when compared with the cost of programs to create new jobs and train people for them. That's why the idea didn't take off after tests in the 1960s and '70s. It's largely why Finland recently abandoned a basic-income plan after a small test.
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Another Universal Basic Income Experiment is Underway, This Time in Canada More

Another Universal Basic Income Experiment is Underway, This Time in Canada

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  • Student stipend... (Score:5, Insightful)

    by b0s0z0ku ( 752509 ) on Wednesday June 20, 2018 @12:28PM (#56817076)
    The smarter way would be to pay students or people in vocational training programs a stipend for a maximum of a certain number of years. Encourage self-improvement without the situation becoming permanent.

    • Re:Student stipend... (Score:5, Informative)

      by Dixie_Flatline ( 5077 ) <.vincent.jan.goh. .at. .gmail.com.> on Wednesday June 20, 2018 @12:40PM (#56817168) Homepage

      I'm not convinced you read the article.

      For instance, near the end, there was this:

      "In 2015, two years before the basic-income trial, Bowman asked a case worker if she could get help paying for transportation to a Fleming campus that offers classes in social work. The official said that would lead to cuts in other benefits Bowman relied on. The message Bowman says she got was: “You’re unemployable. You’re not worth investing in."

      A lot of people that are stuck in poverty actually want to work. (Indeed, many of them are working and just not making enough money to break out of poverty.)

      The original Mincome experiment in Canada in the 70s found that the only people that worked less during the experiment were new mothers, and young men...who used the money to stay in high school and complete that stage of their education, rather than leave school early to get a job and make enough money to help out at home.

      Context is certainly everything with experiments like this, which is why people keep trying them. I think for many parts of Canada, this could be a big win.

    • Or have better national level unemployment. A lot of state programs allow you to not qualify if you are terminated "for cause" and don't last long enough. I can understand not being eligible if you quit, but if you make a mistake (even a big one) and lose your job that's still unintentional.

      I'd say universal eligibility outside of outright quitting and at least 12 months of time on the program to find a new job. I don't agree with the idea of a free handout, but realistically if someone becomes homeless

      • Re: (Score:2)

        by rikkards ( 98006 )

        UBI isn't addressing the existing issues around unemployment, it is addressing the future issues of unemployment around automation. Buddy's wife worked for the Canadian Privy Council and this is a huge thing that pretty much all western countries are concerned about. We aren't talking 5 years down the road, we are talking 20-50-100 years.

    • This assumes that students will choose education that will provide a good career opportunity or that they even know what they want to do with their lives. Look upon the four year graduate rates for universities and despair. A big chunk aren't going to finish at all (though to what extent their time in university was wasted is debatable) and of those who remain a good chunk of students have no idea what they want and bounce around majors like ping pong balls and spend more than four years finishing. Even amo

      • Re: (Score:2, Insightful)

        by Darinbob ( 1142669 )

        A college degree of any kind will put you ahead of where you would be without one.

        • How much money can you make with a degree in basket weaving? How much debt did you accumulate getting your degree in basket weaving?

        • Demonstrably untrue. A college degree of many kinds will put you in debt and working a minimum wage job. How does that put you ahead of someone who got that minimum wage job out of high school and has been making money for 4 years?

    • Ontario already has that... OSAP when students parents are not wealthy enough to afford to send their children to post-secondary and Second Career which pays for retraining - up to 2 year programs I believe.

      Part of the benefit of this program is eliminating dehumanizing and expensive bureaucracy. Rather than going through all sorts of hoops to qualify as a class (welfare, disability, etc) they'd eliminate all those agencies and simply give everyone UBI that's clawed back as you start to get income. It's e

  • The difference is that right now there are jobs available. I thought UBI was to support the population when no jobs were available because they were lost to automation.

    • That is pretending jobs lost to automation is a like a big light switch that is one day true and the previous day false. Jobs are being lost to automation at a steady rate, the existence of other unrelated jobs.

    • Re:Sounds like welfare not UBI (Score:4, Interesting)

      by pr0t0 ( 216378 ) on Wednesday June 20, 2018 @12:53PM (#56817270)

      I think this is just an experiment to gather information about UBI's in general, not solve a specific problem in Ontario. These are the kinds of tests we (as a species) should be doing now to prepare for a future (50-100+ years off?) when perhaps automation has supplanted enough jobs that we simply have more workers than work. There's no doubt automation will continue, and AI will eat up all kinds of jobs. The question of whether there will be enough new jobs is one I don't think we can definitively answer.

      It's tough to imagine that future, but it's better to find out what does and does not work now than when it's too late. These things will probably need to run for a very long time to prove or disprove viability, with lots of different approaches all seemingly hinging on the fickle idiosyncrasies of the human experience.

      In the end, we may find that UBI simply doesn't work AND that there will not be enough jobs. In which case there will likely have to be limits placed upon how much a company can automate (or how much people can procreate).

      • lower full time start at 32 hours a week + have OT hit X2+ levels.

        • This is a far better solution than limiting what can/can't be automated. Though I would say to do it as follows:
          1. European/Australian style mandatory minimum vacation times, and requiring people to take them. This results in requiring staffing a minimum of 3 people capable to handle every task (can be accomplished via overlapping duties), since at any given moment 1 may be on vacation, and 1 may need to call in sick, quit, etc.
          2. Reduce workweek to 32 (or 30) hours. Definition of "part time" reduced t

    • Comment removed based on user account deletion

      • Are jobs really being lost to automation?

        Yes. Or not even created in the first place. See Tesla among other companies that started with 90% automation. A couple of decades ago they would have hired a lot more people. These days they're building alien dreadnoughts [latimes.com], as Musk refers to his factories. Note how many humans are in the photos of Tesla's factories [www.pto.hu]. And yes, they are actively building cars in those photos.

        Or is automation making some jobs obsolete while creating new ones?

        Could you please explain what new jobs could possibly be created that wouldn't be automated in the first place? And if you have an examp

  • This will create disincentives to work (Score:3, Interesting)

    by Gregory Eschbacher ( 2878609 ) on Wednesday June 20, 2018 @12:35PM (#56817136)

    The problem with this approach is it removes incentives to work. What if you are currently unemployed or underemployed? If this basic income pushes you up by $17,000, then it removes the incentive to find a better job until you find one that makes well in excess of $17,000. If the stipend is removed once you make about a certain amount, you're creating a disincentive to make that amount.

    Giving everyone a smaller basic income (regardless of their current income) avoids that trap: You are still incented to work since you'd get the basic income plus whatever job income.

    This seems doomed to failure. But since it is a limited, small experiment, it's still worthwhile to gather the data and try and measure the cost tradeoffs (such as, "At what income would a person need to work until the incentive to stay on the basic income goes away?" Hopefully this would provide real data.

    • Re: (Score:3, Insightful)

      by Anonymous Coward

      The problem with this approach is it removes incentives to work.

      Isn't that the same argument against providing unemployment benefits, food stamp, and homeless shelters?

      • Isn't that the same argument against providing unemployment benefits, food stamp, and homeless shelters?

        The problem with homeless shelters is that once a homeless has shelter he's not homeless anymore and stops being eligible to homeless shelters. Which then of course means he's homeless again and is now eligible to homeless shelters, which in turn...

        It's a non-stop carousel that does nothing for the homeless and only provides work for the bureaucrats.

    • Solution is don't remove the stipend. Make the stipend an income floor, above which you can make money, whether it's $1000/yr or $100,000.

      • Multifactor (Score:2, Insightful)

        by Anonymous Coward

        Yep, this. Theoretically UBI only works well if:

        1. EVERYBODY gets it
        2. There is no minimum wage

        The idea is, if you are a restaurant, for example, you'd be more inclined to hire people for $3/hour just to keep the place clean. That's not much, but you could make a few thousand extra a year working a few hours a day over your UBI, even in addition to another higher paying part-time job, it would be worth it to someone.

        • Re:Multifactor (Score:5, Insightful)

          by king neckbeard ( 1801738 ) on Wednesday June 20, 2018 @03:19PM (#56818148)

          Actually, a UBI would likely see an INCREASE in overall wages, even if it does remove the need for a minimum wage. Because we're arming workers with the power to say "Fuck Off!" if given a lousy deal.

          There might be some exceptions for jobs where most of the job is waiting for something to happen.

      • Yeah, the only way Universal Basic Income works is if it's, you know... Universal. Everyone gets it regardless of income level. You don't lose it when you find a job. You don't lose it when you go above the poverty line. You don't lose it when you fail to meet some arbitrary measure. Nothing you make above and beyond the UBI is going to reduce the amount of money you receive.

        Paradoxically, this lets us move labor to more of a free market. Employers no longer need to pay a minimum wage, UBI takes care of

    • The problem with this approach is it removes incentives to work.

      It doesn't remove the incentive to work nearly as much as contingent unemployment benefits, which any competent neoliberal economist is quick to point out.

      The minimum wage is also problematic, for the the incentive purist.

      Or, for that matter, a food bank.

      If you eliminate contingent unemployment benefits, minimum wage, and food banks the most likely outcome is that UBI improves the incentive to work.

      And another thing: it would discourage abusive

    • If this basic income pushes you up by $17,000, then it removes the incentive to find a better job until you find one that makes well in excess of $17,000.

      You might want to learn what UBI actually is before typing stupid shit on the internet about it. The entire point of UBI is that you get it instead of other benefits (food stamps, welfare), and you don't lose it if your income passes some threshold. That's what makes it different from unemployment or welfare. If you'd bothered to read anything at all, you could find this tidbit:

      For every dollar that recipients earn above the minimum, their payout from the province will be cut by 50 cents, but no one is made worse off by working.

      • I think you're in violent agreement with the OP. He's saying that the problem with this experiment is that it isn't universal, and that's what would create the disincentive.

    • If the stipend is removed once you make about a certain amount ...

      If so, then it is not a UBI. The "U" in UBI means unconditional.

    • The problem with this approach is it removes incentives to work. What if you are currently unemployed or underemployed? If this basic income pushes you up by $17,000, then it removes the incentive to find a better job until you find one that makes well in excess of $17,000. If the stipend is removed once you make about a certain amount, you're creating a disincentive to make that amount.

      Giving everyone a smaller basic income (regardless of their current income) avoids that trap: You are still incented to work since you'd get the basic income plus whatever job income.

      This seems doomed to failure. But since it is a limited, small experiment, it's still worthwhile to gather the data and try and measure the cost tradeoffs (such as, "At what income would a person need to work until the incentive to stay on the basic income goes away?" Hopefully this would provide real data.

      You just need the same basic approach as progressive income tax, you don't actually lose money by moving into the higher income bracket because you're only taxed on the amount you make above the previous bracket.

      Do something similar here, you don't the benefit the moment you make more than $17k, the benefit just gets smaller.

      ie, if your job pays $20k you still get $5k of UBI benefits so that the $20k job is actually worthwhile.

      My only concern with this setup is it suddenly makes tax fraud much more enticing

    • You're right, it removes the incentive to work a shitty job that doesn't pay enough to live on. It has the benefit of lifting what employers are going to pay for garbage work that nobody wants to do. In the story, one of the people was effectively using the UBI so they could work a job they enjoyed at a museum, but wouldn't have been able to keep on the salary the museum was able to pay. In that case, we've got the UBI making an opportunity to serve the community possible. But if you've got hard, dirty labo

    • What if you are currently unemployed or underemployed? If this basic income pushes you up by $17,000, then it removes the incentive to find a better job until you find one that makes well in excess of $17,000.

      It encourages employers to pay more than $17,000 for any job where you cannot handle the person quitting because they don't feel like it anymore. And it encourages entrepreneurship, because you make $17,000/yr (instead of the usual $0) while getting your business started and going.

      Also, 17k/yr is less

  • Universal income is still hides the problems with taxation. When is somewhere going to pilot the fair tax?

    • Hopefully never, because the "fair tax" hurts the people who can least afford it the most, and is anything but fair.

      =Smidge=

      • Hopefully never, because the "fair tax" hurts the people who can least afford it the most, and is anything but fair.

        =Smidge=

        As long as enough people never understand all the taxes paid by people who can least afford it, the system will always be grossly unfair.

        • > As long as enough people never understand all the taxes paid by people who can least afford it, the system will always be grossly unfair.

          That makes no sense. Maybe your idea of what "fair tax" is isn't what advocates of the actual "Fair Tax" bill promote, or maybe you just don't realize that sales tax disproportionately increases costs of living on people whose taxable spending takes up the majority of their income (i.e. poor people)

          =Smidge=

          • > As long as enough people never understand all the taxes paid by people who can least afford it, the system will always be grossly unfair.

            That makes no sense. Maybe your idea of what "fair tax" is isn't what advocates of the actual "Fair Tax" bill promote, or maybe you just don't realize that sales tax disproportionately increases costs of living on people whose taxable spending takes up the majority of their income (i.e. poor people)

            =Smidge=

            That's what the pre-bate under the fair tax does; eliminates tax for the necessities low income people need to buy. Instead, with the current system over half of the federal government's revenue comes from sources you never actually see: payroll taxes (which reduce workers' wages) and corporate income tax (which everyone pays as baked into the cost of everything they buy) and import taxes (which everyone pays as baked into the cost of anything they buy that was imported).
            The nasty thing about payroll and c

  • It's all about attention... (Score:5, Interesting)

    by MindPrison ( 864299 ) on Wednesday June 20, 2018 @12:48PM (#56817232) Journal

    ...was it Finland that did this experiment first?

    But it's a modern PR thing, oh-we-are-so-progressive, we're going to try this, we're ahead of the heard. I've seen so many countries try this by now (and later ditching it, when it wasn't making the news anymore) that I don't quite believe in the sincerity behind the project.

    I'm all for Universal Basic Income, because I personally believe that no one should starve to death, and everyone should have a basic platform where they could work themselves up from rock-bottom to a worthy place in society. And of their own choice, not what WE think is a worthy place. We're all different - there's a place for us all.

    But these half assed experiments aren't impressive, just depressive. And they always make the news, as if they where amazing, innovative, new and fantastic.

    There's nothing fantastic, new or amazing by it. There's only "PR - LOOK how innovative we are, we're giving it a go".

    No you're not. 4K is a drop in the ocean, in fact - it's a drop in a freaking POND somewhere. If you want to see the real ramification of it all, if you want to see the actual effect, it got to be introduced as a WHOLE for everyone. People aren't automatically going to ditch their job, no one wants to live on existence minimum. but it will give oddball individuals a chance to grow into their position in life. It will give people who lost their jobs to automation - a chance to re-educate themselves, it will give people time to reflect, and not just shrivel up and die on some street corner somewhere.

    • right now I have to live where the wages are high enough to afford a car, food and my child's tuition. It also means I pay $1300/mo for a crappy 3 bedroom apartment I share with my brother (Need the 3rd room in case the kid has to come back). I haven't bought a house because I can't afford one.

      Give me basic income and I can move somewhere else where housing is cheaper because the wages pay less. Even if I don't other people can and will and that will lower housing prices. It also would mean I could take
      • Give me basic income and I can move somewhere else where housing is cheaper because the wages pay less. Even if I don't other people can and will and that will lower housing prices. It also would mean I could take risks with employment (especially if we had single payer healthcare in America). That would also drive up wages and standards of living. What it would _not_ do is help mega corps bottom line. It would utterly decimate the political power of the 1%. They could no longer threaten the working class w

    • If you want to see the real ramification of it all, if you want to see the actual effect, it got to be introduced as a WHOLE for everyone.

      You are bold! I assume you're volunteering to fund this, right? Or are you suggesting that the Canadian government should make a $50 billion gamble on this?

      Make no mistake, I'm in support of UBI. But politically, I doubt most countries in the world could take that gamble. You're talking about a very significant percentage of all expenditures by a country being required to fund UBI. Here's one analysis [futurism.com]:

      But how would we pay for this? $1,000 a month for everyone would cost approximately $2.7 trillion annually, which represents around four to five times the size of the defense budget and 15 percent of the GDP.

      I get that UBI doesn't work if it's not universal. But before you're going to convince anyone to take this

      • A large amount of the UBI that goes to people living in poverty would come from eliminating things like unemployment insurance, food stamps, and Social Security, including additional money saved by having far less administrative overhead. For the middle class (let's make up a number and say the middle 80%), you would raise their taxes by roughly the same amount as the UBI, so most people will be basically unaffected.

    • Re: (Score:2)

      by Kjella ( 173770 )

      I'm all for Universal Basic Income, because I personally believe that no one should starve to death, and everyone should have a basic platform where they could work themselves up from rock-bottom to a worthy place in society.

      Many countries in Europe have something like a "last resort" program for people who'd otherwise be homeless and starve. Here in Norway it's the primary income of 1% of the population and costs us 0.5% of the national budget. That's only if you don't qualify for anything else like unemployment benefits, disability, public pension and don't have any income or savings to support yourself though and it's really just to cover the basics. It's nothing like an UBI program though.

    • But it's a modern PR thing, oh-we-are-so-progressive, we're going to try this, we're ahead of the heard. I've seen so many countries try this by now (and later ditching it, when it wasn't making the news anymore) that I don't quite believe in the sincerity behind the project.

      In Finland, it was designed, implemented and aborted by right-wingers who wanted it to fail. It was PR, but not "oh, we're modern" PR. It was "basic income will never function, back to work" PR.

  • 60 years of steadily increasing productivity (Score:5, Interesting)

    by rsilvergun ( 571051 ) on Wednesday June 20, 2018 @12:54PM (#56817286)
    means things are pretty different today then they were in the 60s. And we've got a massive, massive push for automation coming. Basic income doesn't make sense when you need everybody working. Those days are coming to and end. We can't all be Doctors and engineers. A lot of us just aren't smart enough. And we can't retrain everybody. Not everybody can learn a complex new job. Most can't past the age of 30.

  • It's largely why Finland recently abandoned a basic-income plan after a small test.

    The above is incorrect and they didn't: http://www.wired.co.uk/article... [wired.co.uk]

  • The recipients are getting 75% of poverty line payments. If that truly is what the name suggests then it is not enough to live on. The scheme will only run for 3 years, so there is no scope for making life-changing decisions (such as giving up work) knowing that when the scheme ends you get cut off.

    And when you read the referenced article, it turns out that this isn't a trial of UBI at all. It is basically just a boost to the benefits system to see if it can save money in other areas: reducing crime, impr

  • Pre-emptive strike: Math is still math, UBI still doesn't scale up, UBI fanbois need to keep it in their pants, calm down, and resign themselves to working until they drop dead, no free ride for you or anyone else, not until you invent 24th Century Starfleet-style matter replicators and plentiful free power to run them provided by ubiquitos antimatter reactors. </subject>

    • UBI still doesn't scale up,

      I don't see why. In the US, the budget allows something like $5k/yr in UBI without increasing taxes or decreasing programs that aren't replaced by UBI. I mean, that's only 1/3 of the way to a real UBI program, but that's the US. With a crazy bloated military budget and pretty low tax rates.

  • With legal marijuana, now is the time to get into the fast food industry!

  • This experiment gives $17000/year to the poors. Without that experiment, they were receiving less than that in social care. So of course they are going to do better with more money. But that shouldn't be the point of the experiment. The experiment should be about comparing how to give $X to the poor in the most efficient way. Is it more efficient to give them a sum with no strings attached? Or to put conditions such as "you loose that money if you earn more than $Y".
    Sadly, this experiment isn't going to tea

  • Tax 1% of business profits, and 1% of household income, and distribute that pile of money evenly amongst all legal residents. It's simple and changes with inflation.

  • Another Universal Basic Income Experiment is Underway ... the world's biggest tests of a guaranteed basic income... [Area of test] has about half the people in the pilot -- some 10 percent of the town's population.

    The Canadians are testing it as an efficient antipoverty mechanism, a way to give a relatively small segment of the population more flexibility to find work and to strengthen other strands of the safety net.

    There's nothing univesal about this.

    Welfare. The word for this is welfare. Unless everyone gets it, it's not universal. It is income. And I would say that 75% of poverty is pretty basic. So it's good on those fronts, but it's not universal. It is welfare.

    Also, it's a shitty experiment unless the populace WITHIN the area ALSO gets to PAY FOR IT. There's two sides of UBI. Where the money goes and where the money comes from. How much does it help the people it's going to? and how much does it royally piss o

  • Recently I've found different solutions with similar goals to be more promising and less problematic, such as universal basic services and/or a citizens' dividend.

    Problems with UBI:

    https://www.nakedcapitalism.co... [nakedcapitalism.com]

    http://neweconomics.org/2018/0... [neweconomics.org]

    Some better solutions:

    https://www.independent.co.uk/... [independent.co.uk]

    https://www.huffingtonpost.com... [huffingtonpost.com]

    • Re: (Score:2)

      by Hizonner ( 38491 )

      Universal basic services would probably be as expensive as UBI if not more so, because of the cost of the bureaucracy to administer them. That same bureaucracy would make them slow and wasteful; the Soviets tried planned economies and it didn't work. AND being seen to use UBS would carry a ton of stigma and make it harder for people who did want to work to be accepted to do so.

      A citizen's dividend is a UBI. It's just a way of funding a UBI.

  • If I wanted to support a stranger financially, I'd do it. And, maybe, I already do.

    By spending my taxes on such support, the government forces me — at the point of a weapon implicitly behind every tax-collection — to support more people, than I would support on my own volition.

    That's government overreach — a manifestation of tyranny — and should be denounced as such. Like "meatless meatballs", "compulsory charity" is a self-contradictory term.

  • Since the government here would sooner annex Mexico than implement UBI, it is worth looking in to alternatives that would actually work here. One that they really need to look at is single-payer healthcare. Yes, I know it is grouped into the category of "evil *isms" in this country, but it could make a huge - and hugely positive - economic impact if it were actually implemented.

    Take a moment to think about why so many people on the job market are waiting for FT work and why so many PT jobs go unfilled. The driving force behind that decision is health insurance. We tell people they need it, though in many cases PT jobs still are not required to offer it (or at least they are not required to offer it at a price that the employee could actually afford).

    If we made even a base plan available to every man, woman, and child, then suddenly the workers who are turning down PT jobs in spite of interest in them (in particular this is a lot of parents of younger children, as well as retirees with poor benefits). could take those jobs. This opens up more FT jobs for people who can't get by on PT work alone.

    And yes, single-payer from the government would cost money. It would be a tax, just like income tax. And a large number of people would find that tax would end up being less than what they pay to their insurance through their employer once everything is accounted for, it would just be handled differently.

  • Always a problem in Canada (Score:3)

    by erp_consultant ( 2614861 ) on Wednesday June 20, 2018 @03:33PM (#56818232)

    High unemployment that is. Particularly in the Maritime provinces (far east coast of Canada) where most people work in the fishing industry. in the winter, everything is frozen and there is basically no tourism. So most of them go on unemployment benefits - year after year after year. Work 6 months, 6 months on the dole.

    When I lived in Ontario I knew this guy that cut grass on golf courses in the summer and collected UI all winter. Lived in his parents basement. Sold a little dope on the side to supplement his "income". In fact, I knew lots of people like that. It was almost as if you were considered a sucker if you worked all year.

    This, from what I observed, was the problem with having lots and lots of social programs. Some people need it, some are just lazy. How do you determine who should get it and who should not?

    Having a UBI seems like a logical concept. The problem is how do you decide who gets it? How much should it be? Once you're on it how long do you stay on it? Forever? Will people on UBI be allowed to work part time or will that be de-incentivised like it is for current unemployment and welfare programs?

    Without some sort of exit strategy this will end up becoming another perpetual "poverty alleviation" program paved with good intentions but littered with poor results.

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