martes, abril 12, 2016

Minimalists governments with fair global free deregulated markets must arrive soon

Fifth update. The strong case for global systemic deregulation of the electric power industry. This is the large response that supports the following
This is a short response to “Is It Time to Deregulate All Electric Utilities?,” one of Nov. 13, 2016, reports of the Wall Street Journal special section on energy issues. A long response is in the post “Minimalists governments with fair global free deregulated markets must arrive soon (link in active part of tweet),” where remarks [1]…[6] are available. Next are representative quotes from the two articles on the deregulation issue.

YES: It Is the Best Way to Lower Costs and Increase Innovation, by Andrew N. Kleit: "Restructuring hasn’t lived up to all of its promises".

NO: The Evidence So Far Shows Little Benefit to Customers. by Kenneth Rose  1) "...  a big factor is something policy makers have no control over—industry structure." 2)  "... electricity markets still need considerable economies of scale to operate efficiently, and restructuring hasn’t provided sufficient benefits to overcome the loss of efficiency that occurs when monopoly utilities are dismantled." 
Most observers are dominated by the deep and widespread numbing ‘Groupthink’ effect of the industrial civilization based on Cartesian thinking [1]. This is another thought experiment. It is an approximation to the ‘Emergence’ scenario [2] under which ‘The Theory of the Business’ [3] of electric utilities is running away from industrial civilization reality. In our lingo, they were systemic and turning into anti-systemic [4]. Electric utilities restructuring was introduced in jurisdictions that were the most anti-systemic and the result was still anti-systemic because they depended on supply side economies of scale.

Both Kleit and Rose are restricted under ‘Groupthink’ to the transition of the power industry. Under transformation [5], policy makers don’t need to control industry structure under systemic restructuring where considerable demand side economy of scale [6] will emerge as we leap into the systemic civilization. By being highly anti-systemic the Dominican Republic has a huge and urgent opportunity to transform. 
The title of this update fills something necessary but missing in the Knowledge Problem blog post The weak case for continued regulation of the electric power industry, posted on November 14, 2016 by Michael Giberson, which is the original source that we found. In what follow we will add remarks with must read blog posts and papers for each of the brackets identify in the short response.

[1] From better places… to the emerging civilization,
Summary: as the world run by Cartesians (as defined here) is under huge systemic problems, the rest of the world needs to unite themselves into Peircians (also defined here) to enable the systemic civilization to emerge. A Spanish version of this article without hyperlinks is available here
[2] Why the Eurozone leaders must change their common sense first
Sixth update. The un-deluded referendum will dissolve #Brexit, #Calexit #Texit #Catalexit and for that matter #Anyexit.
Summary of the sixth update. It is the people in knowledge of making their country and the world great who have the power to vote freely in a referendum to decide the change of course to the 'Emergence' scenario. It is not for the government to decide this scenario that makes the State become minimalist and sponsor the direct democracy of the systemic market that involves the creation of systemic civilization of interdependent countries. It is the people who will make politicians to change their common sense.
[3] The Theory of the Business, by Peter F. Drucker, FROM THE SEPTEMBER–OCTOBER 1994 Harvard Business Review ISSUE
The root cause of nearly every one of these crises is not that things are being done poorly. It is not even that the wrong things are being done. Indeed, in most cases, the right things are being done—but fruitlessly. What accounts for this apparent paradox? The assumptions on which the organization has been built and is being run no longer fit reality. These are the assumptions that shape any organization’s behavior, dictate its decisions about what to do and what not to do, and define what the organization considers meaningful results. These assumptions are about markets. They are about identifying customers and competitors, their values and behavior. They are about technology and its dynamics, about a company’s strengths and weaknesses. These assumptions are about what a company gets paid for. They are what I call a company’s theory of the business.
[4] Why the Eurozone leaders must change their common sense first
Fifth update. Great Capitalism common sense to 'Make the World Great' as 'The American Way of Life' model is unsustainable. 
One critical idea emerged by reframing the system concept which restricts its meaning to positive leverage outcomes. Such reframing is complemented by the anti-system concept for the negative leverage outcome. The increased usefulness, of the 'least common and powerful' structural explanations, mentioned in the main text of this post, tell us that independent countries have become anti-systems by trying to copy 'The American Way of Life,' as the industrial civilization is operating under the saturated region of its experience curve. In fact, that reframing helps explains, for example, soaring inequality, migration and climate change anti-systemic crisis. It may also explain organizations that are structured as money making machines that are anti-systemic.
[5] Can #GlobalDebaut international call concentrate on an Ashoka like solid framework change?
Nomination of José Antonio Vanderhorst Silverio to the Ashoka Global Fellowship
Please articulate the core idea of your work and describe how this idea is new or different from current approaches. 
The need to leap from the industrial civilization (centered on the paradigm of independence) to what we (me and a few Twitter citizens) named as the systemic civilization (centered on the paradigm of interdependence). Such leap is based on a framework change that might start on the electricity sector to enable high green economic growth, for example, in the USA, Puerto Rico, Spain, Haiti, Dominican Republic, other countries, or any combination of them. This work started in 1996 addressing Dominican Republic electricity crisis. The main difference with current approaches is transition versus transformation. Transition, for example, is what’s driving the IEEE Smart Grid (more below) and even in the climate change COP21 Paris Agreement, where their ideas are based on the primacy of the parts, while transformation is based on the primacy of the whole.
[6] Pipelines, Platforms, and the New Rules of Strategy, by Marshall W. Van Alstyne, Geoffrey G. Parker and Sangeet Paul Choudary  FROM THE APRIL 2016 Harvard Business Review ISSUE
The driving force behind the internet economy, conversely, is demand-side economies of scale, also known as network effects. These are enhanced by technologies that create efficiencies in social networking, demand aggregation, app development, and other phenomena that help networks expand. In the internet economy, firms that achieve higher “volume” than competitors (that is, attract more platform participants) offer a higher average value per transaction. That’s because the larger the network, the better the matches between supply and demand and the richer the data that can be used to find matches. Greater scale generates more value, which attracts more participants, which creates more value—another virtuous feedback loop that produces monopolies. Network effects gave us Alibaba, which accounts for over 75% of Chinese e-commerce transactions; Google, which accounts for 82% of mobile operating systems and 94% of mobile search; and Facebook, the world’s dominant social platform.
Fourth update.We are in the right moment of opportunity for Global Debout towards a new energy market blueprint. Highlighting the Arab Spring, which is the true origin of Global Debout, to conclude that “Corruption as a whole robs the future of a country. Steals not just money from citizens; steals their trust in governments,” on May 3, 2016, U.S. Secretary of State John Kerry delivered remarks at a joint reception for the Council of the Americas 46th Annual Washington Conference and the U.S.-Caribbean-Central American Energy Summit in Washington, D.C. More of what Secretary Kerry said, including the context of his quote, is found below.

It is now known that there is a deeper issue than corruption: big government. There is also a misunderstanding over the idea “steal trust in [big] governments:” the emerging trust in well-designed direct democracy systemic markets to balance the State market relationship. Both the deeper issue and the misunderstanding have already been addressed and generalized in the “First update. Would #GlobalDebout aim #DD_SM direct democracy towards minimalists States under #Jobsism?” of this same paper whose introduction says:
The subtitle "Corruption is just a symptom of Brazil’s deeper issue: a vast state apparatus that has tried to be the country’s engine of economic growth," of the essay Brazil’s Giant Problem is a welcome contribution to the need for the framework change required by the Global Debout. That deeper issue is precisely what mutually reinforces the need for minimalists States as addressed in this paper's main text. The essay also brings to fore Jobsism as a framework change in the "First update. What voters are not expecting but will love: a minimalist State that drives direct democracy systemic markets" of the post Elections in USA, Germany, Spain, DR are under unstable equilibrium, as they were in Argentina, Brazil, Venezuela, Spain, where it says:
Having reinforce the insight of minimalists governments, now we go to the new energy market blueprint as the right opportunity for the kind of framework change needed by Global Debout. On May 4, 2016, during the U.S.-Caribbean-Central American Energy Summit, U.S. Vice President Joe Biden said that “The Caribbean is poised to be a laboratory of how we deal with the energy challenges of island nations all around the world…” He added “If we do this right, it will become the blueprint for how other nations similarly situated are able to meet the needs of their constituents… attract development, generate jobs…” As has been documented in this blog for quite some time such a blueprint is already available as a framework change designed to enable the transformation of not just for island nations, but for most nations to deal with the energy challenges all over the world.

In essential support for the summit, the first paragraph of the conclusion of the REPORT FROM THE TASK FORCE ON U.S. CARIBBEAN AND CENTRAL AMERICAN ENERGY SECURITY, presented to Leaders by the Co-Chairs of the Task Force at the U.S. Caribbean Central American Energy Summit, on May 4th 2016, says:
The energy security challenges in the Caribbean and Central America are not unique: access to cost-effective, reliable energy is a major challenge and impediment to competitiveness for a majority of countries across the globe. The Task Force for Caribbean and Central America Energy Security—represented by the Caribbean Community Secretariat, Central American Regional Electricity Market’s Council of Directors, and several U.S. agencies—seeks a transformational solution to these perennial problems.
They say they are seeking for a transformational solution, but as we will see below they are based on a transitional solution at this moment, which are not about “perennial problems” of “a majority of countries across the globe” that need to follow what a minority of industrial countries of the world are providing as business as usual based on deepening a flawed regional energy integration blueprint (a framework problem being faced also, for example, in the European Union).. The transformational solution is a new blueprint that will leapfrog the current transitional solution where incomplete organized wholesale markets, which have strong barriers in place contrary to entrepreneurs and innovators.

The U.S. has been trying to lead a transition to low carbon with developments which keeps carbon with Natural gas. That transition was supposed to fit well with the idea of establishing a fully liberalized and interconnected energy market. However, such an idea is flawed as the current energy market is no fully liberalized, where energy is artificially cheap while creating climate change. In fact, as can be recalled from the @gmh_upsa paper "A complete and fully functional electricity restructuring proposal," which is the basis for the new blueprint:
In the Executive Summary of Cato Institute’s Policy Analysis No. 530, Rethinking Electricity Restructuring, of November 30, 2004, Peter Van Doren and Jerry Taylor wrote emphatically that:
Electric utility restructuring was initiated in the 1990s to remedy the problem of relatively high electricity costs in the Northeast and California. While politicians hoped that reform would allow low-cost electricity to flow to high cost states and that competition would reduce prices, economists wanted reform to eliminate regulatory incentives to overbuild generating capacity and spur the introduction of real-time prices for electricity.

Unfortunately, high-cost states have seen little price relief, and competition has had a negligible impact on prices. Meanwhile, the California crisis of 2000–2001 has led many states to adopt policies that would once again encourage excess capacity. Finally, real-time pricing, although the subject of experiments, has yet to emerge. 
Most arresting, however, is the fact that restructuring contributed to the severity of the 2000–2001 California electricity crisis and (some scholars also argue) the August 2003 blackout in the Northeast, without delivering many efficiency gains.
After a lot of hard work documented in the background on this blog, we can come to the simple (not simplistic) conclusion that U.S. electricity restructuring violated Peter Drucker’s quote: "Long range planning does not deal with future decisions, but with the future of present decisions."  A reinterpretation of Drucker’s quote tells us that what “politicians hoped that reform would allow low-cost electricity to flow to high cost states,” has been known since 2004 as a huge mistake because “Unfortunately, high-cost states have seen little price relief, and competition has had a negligible impact on prices,” which is all about long range planning dealing with future decisions.

As anticipated above, we come back to Secretary Kerry. In line with Drucker's quote, he told that “We will need to make the right choices now… today, tomorrow,” and then talk about three areas of cooperation:

#1. Trade. Extend the benefits of free and open trade. Artificial barriers stop on creativity.
We say that the current organized wholesale markets low carbon transition do not provide the expected benefits of free and open trade. Instead, the organized wholesale market framework have strong barriers in place contrary to the zero carbon transformation the above mentioned @gmh_upsa paper. Under the low carbon transition, the Vicepresident is right that volatile oil prices will return, but they will no be so under the zero carbon leapfrog transformation.
#2. Supporting entrepreneurs and supporting innovators as they strive to get their businesses up and running.
Secretary Kerry said that President Jimmy Carter created the US Small Business Development Network almost 40 years ago, which has been used by the Obama administration as a framework for a pattern change in the rest of the Americas.  However, such pattern change in energy is a waste, unless there is the leapfrog framework change that results in the new blueprint.
#3 Promote accountability and transparency in government institutions.
He said that “now more than ever citizens all around the world are making clear to everybody that corruption is not going to be tolerated. He them told the story of the fruit vendor in Tunisia who started the Arab Spring.  Then concluded that the two days have to do with the aspiration of people. And the ended with the above mentioned quote “Corruption as a whole robs the future of a country. Steals not just money from citizens steals their trust in governments.”
Third update. Do #GlobalDebout actors and experts know that "Thinking is the hardest work there is..."? The quote "Thinking is the hardest work there is, which is probably the reason why so few engage in it" is one of a variant said by Henry Ford. Because the context under which the quote emerged is the update of the quality collabotarion Leadership Answers What to do First, it is critical to justify the difference with quantity collaborations which are emotional and lack thinking. With the subject "See why voters need to know before may 15, 2016 that Dominican Republic can be the global leader of electricity transformation," I sent an eMail that was distributed to actors and experts summoned to the Pacto Eléctrico, as well as many other citizens, that said:


Dear reader,

Greetings!

As can be seen in the "Second update. Do voters need #Fordism transitions or #Jobsism transformations under #GlobalDebout?," of the post Minimalists governments with fair global free deregulated markets must arrive soon it is a waste of time to try to continue with Pacto Electrico. Instead, we must unite our effort to lead the world in electricity transformation, while USA lead countries union transformation and Spain countries contitutions transformations.

Happy weekend,

José Antonio Vanderhorst Silverio, Ph.D.
Consulting engineer on systems architecting
Servant-leader Dominican and global citizen
On 2016-04-29 16:51 GMT-04:00 Iraima Capriles del CES responded: 

Mr. Vanderhorst,

Thank you!

You too have a nice weekend.

Iraima

Then I sent an eMail with the subject "Respuesta a "Think. It's not illegal yet"
Dear Iraima,

Agradezco tu mensaje en base al intercambio que sostuve en Linkedin y que aparece a continuación:
David Talvy - colocó una imagen que decía: "Think. It's not illegal yet"  
José Antonio Vanderhorst-Silverio: Agree that "Think is not illegal" and maybe never will, because according to Henry Ford "Thinking is the hardest work there is, which is probably the reason why so few engage in it." Is that what's behind the failure of the meritocracy of the Democratic Party as explained by Thomas Frank? In that light, since leadership requires a lot of thinking, please consider the recent update to the 8 year old post "Leadership Answers What to do First ( http://bit.ly/g690mh )."   
David Talvy. Gracias José Antonio Vanderhorst por sus comentarios y link, interesantes sin duda. Un cordial saludo. David    
José Antonio Vanderhorst-Silverio: A la orden David Talvy. Gracias por apreciar los comentarios y la actualización de la nota. Muchos saludos. José Anronio. 
Saludos,
José Antonio
Second update. Do voters need #Fordism transitions or #Jobsism transformations under #GlobalDebout? The transition versus transformation dilemma is disolved this way: voters need both, but under #Jobsism. They need to learn as soon as possible, before going to vote, constitutional transformation commitments to change the framework from #Fordism to #Jobsism that leads to public sectors transitions to change regulatory patterns. That framework change is the only way people will learn that they will vote not just to elect a national candidates, but for that candidate capacity to be also a global leader as we shift from independent countries to interdependent ones. No longer we will have one or two global leaders, but to be an interdependent country it needs to have a global leader. This fully supports the December 14, 2014, post A Systemic Civilization Global Declaration of Interdependence, which at the moment has the following:
First update of February 2, 2015.

Second update: 5 min. video. Is systemic corruption a problem of civil obedience?

Third update: How much does Greece matter to the 99.9%?

Fourth update: What about a high leverage European referendum that avoids the Greece's crisis go to waste?

Fifth update: Will the Eurozone continue in its Doom Loop unless the Troika is killed?

Sixth update.  A Systemic Declaration of Interdependence model for COP21.


For starters, we are proposing the first three global leaders: USA transform itself to set the pattern change for other countries unions, Spain transform itself to set the pattern change for other countries and the Dominican Republic transform its electric power sector to set the pattern change for other public sectors. Any other countries ready to execute those kinds of transformations please let us know.



Helping emerge the above upgraded considerations by learning from the emergent future, next you will see a translation of the earlier response given to Iñki Gabilondo videoblog on Transitional legislature that can be seen in the image.

Spain does not deserve a transitional legislature, but a transformational one. The reason for the uncertainty of governments is due to the lack of political leadership on a global level as a result of a wrong unstable industrial civilization framework in a highly interdependent world. 
It is true that Spain has cancer, but as does virtually everyone where global crony capitalism rules. I have been explaining that we need a change from the framework of Fordism (in recognition of organization that Henry Ford began ) being followed by the independent countries of industrial civilization, which in Spain is immersed in their 'inviolable' constitution, to the Jobsism (which similarly recognizes Steve Jobs) framework that follow the interdependent countries that we have been calling systemic civilization . 
To cure the cancer, for example, Podemos should forget about the independence to leap into interdependence, which dissolves the red line it has mainly with Ciudadanos. Such global cancer has persisted for decades and has grown like a snowball generating the environmental crisis, growing inequality and political crises around the world, including the recent crisis of migration to the UE. Under instability, deceptive politicians who make promises they know they can not fulfill win elections. Voters around the world need leaders to fill the global vacuum, starting with the United States, Spain and the Dominican Republic. Details can be seen at the Millennium Group Blog Hispaniola.
To get a better understanding why we need framework change, which is supported by the great and timely article The Global Crisis Of Leadership, written by Alon Ben-Meir, Senior Fellow, Center for Global Affairs, NYU, we need to consider from the main text of this paper what "Thomas Frank associates... with the emergence of a meritocracy that failed," to which we inmediately added that "It failed not by being a meritocracy, but by the money led Groupthink consensus under the primacy of the parts," An additional explanation of the failure comes from the April 21, 2016, article Not All Practice Makes Perfect: "Moving from naive to purposeful practice can dramatically increase performance," by  Anders Ericsson & Robert Pool.

Instead of enabling innovations with purposeful practice, the explanation is that has kept countries' meritocracy on naive practice, which agrees with what was said to introduce framework change on the post Can #GlobalDebaut international call concentrate on an Ashoka like solid framework change?, under the section "Nomination of José Antonio Vanderhorst Silverio to the Ashoka Global Fellowship," in its last item "Why are you personally dedicated to the issue?  Please share relevant background, including: your history of entrepreneurship (including childhood years) and the life experiences and/or insights that led to your current path," that says:
In March 2011, playing as the EWPC-AF_Creator, I thought to have been the “All Around Winner of the Smart Grid 2025 Game.” Later I demonstrated the game was for a transition scenario to support the statu quo IEEE Smart Grid, when what’s required is a mindset changer transformation scenario like the EWPC-AF. In November 2012 I was accepted as the interim (first) Chair of the IEEE Dominican Republic Subsection, with an approved business plan of leaping it from Good to Great.  The plan which would later lead to the transformation of the IEEE from Good to Great became bombarded by the corresponding Puerto Rico and the Caribbean Section and IEEE headquarters.
First update. Would #GlobalDebout aim #DD_SM direct democracy towards minimalists States under #Jobsism? The subtitle "Corruption is just a symptom of Brazil’s deeper issue: a vast state apparatus that has tried to be the country’s engine of economic growth," of the essay Brazil’s Giant Problem is a welcome contribution to the need for the framework change required by the Global Debout. That deeper issue is precisely what mutually reinforces the need for minimalists States as addressed in this paper's main text. The essay also brings to fore Jobsism as a framework change in the "First update. What voters are not expecting but will love: a minimalist State that drives direct democracy systemic markets" of the post Elections in USA, Germany, Spain, DR are under unstable equilibrium, as they were in Argentina, Brazil, Venezuela, Spain, where it says:


In Chapter 1, "The transformation of business," of the book "the new age of innnovation: driving co-created value through global networks," the late C. K. Prahalad and M. S. Krishnan strongly support what's suggested in the October 2014 post Applying #Jobsism to transform current global #Fordism marketing myopia in terms of two fundmental principles, which are reinterpreted as follows (with italics of the original):
Jobsism first principle: "Value is based on unique, personalized experiences of consumers. Firms have to learn to focus on one consumer and her experience at a time, even if they serve 100 million consumers. The focus is on the centrality of the individual."  
Jobsism second principle."No firm is big enough in scope and size to satisfy the experiences of one consumer at a time. All firms will access resouces from a wide variety of other big and smal firms - a global ecosystem. The focus is on access to resources, not ownership of resources."
Written by John Lyons and David Luhnow, for The Wall Street Journal, and updated on April 22, 2016, the essay last paragraph quotes Rubens Ricupero, a former Brazilian finance minister, saying:
The trouble is, the only way to fix the politics is through the politicians. Are they really going to vote against their own self interest?
What follows is an adjustment to the translation of an image distributed in Twitter, which generalizes what we witnessed yesterday, Sunday 24 April, when Juan Carlos López moderated on CNN en Español, in the “Choque de Opiniones (Clash of views).” There in the studio participated panelists Maria Cardona, Roberto Izurieta, Maricruz Magowan and from Los Angeles Luis Alvarado. The program sought the presidential nomination process in the US and statements of the candidate Donald Trump that the system is rigged. Our conclusion is that Global Debout could boost shortly a change in the current framework that wrongly suggests what Ricupero said.

Such a change is similar to the famous quote by Henry Ford, when the world changed a century ago: “If I had asked people what they wanted, they would have said faster horses.” What Ford did was a change in the framework for the car, which then served to changing patterns in the vast majority of organizations that led to whai is call Fordism. It is based on that obsolete framework of Fordism that the "Clash of views" was conducted.

But since 2011 indignados movements of the world, including the Arab Spring, 15-M in Spain and Occupy Wall Street have been asking (unknowingly) a change in the framework, we have suggested as Jobsism, recognizing the leadership of Steve Jobs. Said Jobsism changes to the framework of a minimalist state that promotes direct democracy of systemic market (#DD_SM) for voters before voting will find out what needs to be fixed is the market through, for example, a Global Debout to follow the spirit of the 15-M indignados.

Executive summary: Being open to enhancements, this paper is aimed at a pre-electoral institutional innovation leading to high green growth that increases the standard of living all over the world. The time has arrived for a sharp pre-electoral strategy of a systemic electricity law aimed at high green growth as the new normal to start to shrink big government, for example, in the USA, Spain and Dominican Republic. The strategy is in response to a global 'Groupthink' consensus of experts with a superficial ethic dominated by crony capitalism, that keeps unfair complex regulations in place. For example, such consensus wrongly suggest that low growth is the new normal. To restore the character ethics on talent as the means for success, the world now need simple government regulations that enable fair global free market deregulation with long run production capital. This means that political parties must be driven to stop as soon as possible representative democracy ‘Groupthink’ to avoid global society collapse. Such collapse is closer than most policy makers are willing to admit, as the excesive use of short run financial capital where global money governs is what involves increasing government debt which increases global financial instability.

Resumen ejecutivo: Estando abierto a mejoras, este paper tiene esta dirigido a una innovación institucional pre-electoral para el crecimiento verde elevado que aumenta el estándar de vida en todo el mundo. Ha llegado la hora de una estrategia preelectoral aguda de una ley de electricidad sistémica orientada al crecimiento económico verde para comenzar a reducir el tamaño del gobierno, por ejemplo, en los EE.UU., España y República Dominicana. La estrategia es en respuesta a un consenso global "pensamiento de grupo" de expertos con una ética superficial dominado por el capitalismo de amiguetes, que mantiene vigentes regulaciones complejas y abusivas. Por ejemplo, ese consenso sugiere equivocadamente que el bajo crecimiento es la nueva normalidad. Para restaurar la ética del carácter en el talento como medio para lograr el éxito, el mundo ahora necesita regulaciones gubernamentales simples que permitan desregulación justa en el mercado libre global con capital productivo a largo plazo. Esto significa que los partidos políticos deben ser impulsados ​​para detener tan pronto como sea posible "pensamiento de grupo" de la democracia representativa para evitar el colapso de la sociedad global a través de cisnes negros. Tal colapso está más cerca que la mayoría de los políticos están dispuestos a admitir, con el uso excesivo de capital financiero a corto plazo donde gobierna el dinero mundial es lo que implica aumentos de deuda por los gobiernos que aumenta la inestabilidad financiera global.




Minimalists governments with fair global free deregulated markets must arrive soon
“…the central problem of economics is not equilibrium but structural change. This then led to Schumpeter’s famous theorem of the innovator as the true subject of economics.”  
“Economics, for Keynes, was the equilibrium economics of Ricardo’s 1810 theories, which dominated the 19th century. This economics deals with a closed system and a static one. Keynes’ key question was the same question the 19th-century economists had asked: ‘How can one maintain an economy in balance and stasis?’” 
“…it is becoming increasingly clear that it is Schumpeter who will shape the thinking and inform the questions on economic theory and economic policy for the rest of this century, if not for the next 30 or 50 years.’’  
Peter F. Drucker, “Schumpeter And Keynes,” May 1983.

Based on the flawed Keynesan assumption that "Low growth is new normal," the introduction of the press release Fiscal reform key to boost growth in Latin America and the Caribbean, says that:
Weak global growth, a fading demographic boom, lower commodity prices and deteriorating fiscal positions are underscoring the urgent need for major reformulations in fiscal policies of Latin America and the Caribbean, according to the Inter-American Development Bank’s annual macroeconomic report released here today.

Most countries need to trim fiscal spending. However, the report argues against cutting capital investments but rather undertake more fundamental reforms.
In line with Drucker's advice, the confluence of a schumpeterian deep transformation for a systemic electricity law and the emergenge of high green growth as the new new normal, which mutually reinforce each other, suggested below (and well in accordance with the action oriented scientific attitude of this blog) will lead to the Golden Age of the first technological revolution of the systemic civilization.



In line with the video of Carlota Pérez (below we disagre with the suggestion of a Second Machine Age), about capitalism and the social contract, which downplays the quantification of lost factory manufacturing jobs as a result of technology shaping society, to concentrate into how society shapes technology in order to spread the bounty to most of society through changes in life styles to increase the standard of living all over the world. This means that the time has come to enable economic green growth coming from long run production capital, where talent with the character ethic governs, specially at the market at the Bottom of the Pyramid.

The issue of soaring inequality is shown to be the result of 'Groupthink' consensus of experts (the owners the old best practices) that have a lot to lose in the current big shift from the industrial civilization to the systemic civilization that will be co-created organically. The people of the world need minimalists goverments that promotes complete and fully funcional free markets under global interdependence so that the individual co-created customer experience can be of high quality low cost innovations in the global market. Highly regulated unfair regional free trade agreements must be transformed and integrated into one deregulated fair global free market.

This paper is an outgrowth of the “Third update. Has global society chosen to fail with the Paris Agreement developed under representative democracy ‘Groupthink’?” of the post World Economic Forum Davos 2016: Will #OWS and #15M love The Industrialist’s Dilemma? that changes its aim from climate change (which Carlota takes as the solution for green growth) to the political parties, in which we add the finding that Groupthink's root cause for both aims is crony capitalism. While reediting and enlarging the update, some of what has been later on learned under the ongoing action oriented scientific attitude (not Groupthink consensus) will be applied here.

In Chapter 14, “Why do some societies make disastrous decisions?” of his New York Times bestseller book Collapse [1], Jared Diamond proposed a road map “of factors contributing to failures of group decision making.” This is how he introduced his proposal:
We consider those categories as follows:
  1. The group decision made by political parties didn’t anticipate the problem they have now, for example, in the 2015 election in Spain, which seems to have another election in 2016, as are the elections being organized in the USA, the Dominican Republic and other countries. 
  2. The problem arrived with a strong signal on the year 2011, for example, on the Arab Spring, the May 15 Indignados movement in Spain and Occupy Wall Street in the USA, but parties all over the world failed to perceive it. 
  3. Now during the elections since 2015, political parties and the media are confused, but have a way in this paper to perceived it, which means they are so far failing to solve it. 
  4. To try to solve it, as soon as possible before elections, we suggest to political parties of the three countries on the first category to start looking for clues, for example, in the 20 tweets of the post Twitter Analytics TOP TWEETS of @gmh_upsa over the 28 day period ending on April 7, 2016, whose introduction is as follows:
This is a grateful testimony giving thanks to those local and global citizens that have retweeted and like my tweets intended for the greater good of local and global society during said period. As can be seen in the top tweets @gmh_upsa, the electoral strategy of the Systemic Electricity Law for voters before elections as the most prominent. Clicking on the date of a tweet takes you to the corresponding Twitter conversation (sequence) of the tweet, where you can see those citizens we are giving thanks. This option gives you the opportunity to retweet or like a tweet you want to support. Hashtags as well as (bit.ly) links are operating directly.
The main thesis of this paper is that political parties of representative democracies have set up a disastrous decision approach that is leading global society to collapse as a result of their Groupthink based on consensus of the primary of the parts. To support the way to understand it and try to solve it, next we (me and the just mentioned citizens) suggest a way based on the primacy of the whole in which we might have a chance to succeed if such collapse can still be prevented by getting closer to the market State equilibrium with the introduction of complete and fully functional deregulation, starting with electricity sector as a critical, important and where a well documented simplified solution is available to enable green growth for the whole world.

According to the Linkedin post The 8 Deadly Sins of 'Groupthink', by Mike Conforme, “the work of Irving Janis (1918 – 1990) underpins much of the modern theories – or, rather deciphers the peculiarities – of collective decision making. As a research psychologist at Yale University and a Professor Emeritus at the University of California, Janis was probably most famous for his theory of ‘Groupthink’ which described the systematic errors made by teams when making collaborative, consensus-driven decisions.” In this case, the systematic Groupthink errors (repeated and divided in three groups at the end of this post) can now be applied to the representative democracy political parties under the light of the strong evidence of the Industrialist’s Dilemma?

To show that we need the strong leadership to create the systemic civilization, there are three representative examples of the American travelling industry where the bad consequences of Groupthink decision making apply under the emergence of disruptive technologies. The first was railroad, which was documented as Marketing Myopia by Theodore Levitt [2]: the second was when car manufacturers faced small cars that came from Japan and Europe as documented by Gareth Morgan [3]; and the third is coming from Uber (which might be wolf instead of a sheep) as a special case of the Industrialist’s Dilemma, which can be accessed from the main text of the above mentioned post about The Industrialist’s Dilemma.

By taking into account the well documented research of Carlota Pérez [4], it is clear that the first was the result of the change from the third to the fourth technological revolution. As we discovered that Carlota fifth technological revolution should not be considered as part of the industrial civilization, which is now supported here as a result of the influence of Groupthink, the second and the third examples occurred as a result of the emergent civilization change. Such a civilization change fits well as the best explanation of the great decoupling that resulted in the soaring inequality, associated, for example, with the Groupthink overestimation of the representative democracy power, influence and morality. In fact, while the most important underlying assumption of the industrial civilization was independence, it is interdependence for the systemic civilization. More on independence and interdependence below.

Contrary to the third update which restricted itself to consider "outside the scope of this post to prove without any doubt the emergence of the systemic civilization," now there is no doubt  as we are providing key evidence to support its emergence of the systemic civilization that was in the blind spot of Groupthink. Let's start with the book review “The Fourth Revolution: The Global Race to Reinvent the State,” where Rosa Brooks [5]  wrote that:
“The Fourth Revolution” is a lively book, romping briskly — if selectively — through five centuries of history. It makes quick stops along the way to explain “why ideas matter” and to check out the “three and a half great revolutions” that propelled the West into its now-imperiled leadership role. Micklethwait and Wooldridge’s first revolution was the rise of the European nation-state after the Peace of Westphalia; the second was the late-18th- and 19th-­century turn toward individual rights and accountable government; the third was the creation of the modern welfare state. Each revolution improved the state’s ability to provide order and deliver vital services while still fostering innovation. But as democratic publics demanded more and more, the state promised more and more, eventually overextending itself. In Revolution 3.5, Margaret Thatcher and Ronald Reagan tried, but failed, to shrink the state.



While it fits that Revolution 3.5 supports both the great decoupling and the civilization change was emerging but has been restrained under Groupthink, it is not where the cultural shift started as will be seen briefly. The proof of the above mentioned overestimation is given in the interview by Thom Hartmann to Thomas Frank, about his latest book [6], whose interview introduction tell us in fact that:
For tonight's Conversations with Great Minds - we're going to take a closer look at what happened to the Democratic Party. From the New Deal until the middle part of the 20th century - the Democratic Party - like most left or center left parties the world over - was the party of the people. It was the home of unions - social security - medicare - and American working and middle-classes. But then something strange started happening. Over the course of the 1970s - the 1980s - and then the 1990s - the Democrats - well - they got a lot less democratic. They were still "liberal" - or said they were - but they now got their economic policies from Wall Street - and their trade policies from multinational corporations. And that was just the beginning. Then came school "reform" - welfare "reform" - the bankruptcy bill - the bailout. What happened? What happened to the party of FDR - Henry Wallace - and Lyndon Johnson? When did that party disappear and become the party of Bill Clinton - Tim Geithner and Larry Summers? 



Also in fact, Thomas Frank associates the above with the emergence of a meritocracy that failed. It failed not by being a meritocracy, but by the money led Groupthink consensus under the primacy of the parts. Steven R. Covey explained why it failed and where the cultural shift actually started [7]:
The author describes the difference between what he describes as the personality ethic and the character ethic. The character ethic is the idea that a person advances in basis of their character. This was culturally the main idea expressed in the US up until about WWI, when popular literature began to focus more on short-cuts and easy ways to manipulate situations or to get what you want. Character ethic depends on deep changes within each of us, while the personality ethic falls back on methods or techniques. The personality ethic does not challenge us; neither does it bring about deep changes within us. Phrases characteristic of the personality ethic are think positive and believe in yourself.
Such character ethics of talent is what's behind the post Elections in USA, Germany, Spain, DR are under unstable equilibrium, as they were in Argentina, Brazil, Venezuela, Spain, which at this moment starts with its "Third update. Global voters need that Talent govern with #DD_SM deregulation rather than Money. That suggestion is the response to the question “What does ‘capitalism’ mean when Knowledge governs – rather than Money?” that the late management guru Peter Drucker raised in his 1999 book 'Management Challenges for the 21st Century.'” Talent is clearly not the current meritocray with its personality (perhaps better named as superficiality) ethics that is actually being governed by money for a long time under the Groupthink pressure of group conformity with crony capitalism. 

Such a decoupling can also be explained by the mechanistic systems Groupthink under the Cartesian paradigm of the industrial civilization, instead of the organic systems under the systemic paradigm where the system environment needed to be considered. In that regard, Gareth Morgan also wrote [3]:
Since the 1960s, management and organizational researchers have given much attention to shaping the design of work to increase productivity and job satisfaction while improving work quality and reducing employee absenteeism and turn over. Human resource management has become a major focus of attention and the need to integrate the human and technical aspects of work as important principle. 
Work in most parts of the world has now shown that in designing or managing any kind of social system, whether it be a small group, an organization, or a society, the interdependence of technical and human needs must be kept firmly in mind. 
While independence is a key property of the industrial civilization, the interdependence of society is a key property of the systemic civilization, that Covey show must be based on the character ethics. As representative democracy continued under the strong influence of independence and the personality ethic as a result of Groupthink, Dr. Morgan added that:
The principle now seems very obvious and is clearly recognized in most popular theories of organization, leadership, and group functioning. But there is still a tendency in management to fall back into a strictly technical view of organization. As noted in Chapter 2, this has been the primary problem facing the “reengineering movement,” which more or less dominated Western management practice in the early 1990s. Aspiring “reengineers,” paid a heavy price for ignoring the social dimension. By placing primary emphasis on the design of technical “business systems” as the key to change, the majority of reengineering programs mobilized all kinds of social, cultural, and political resistance that undermined their effectiveness.”
Still another example of strongly supporting the civilization change, while ignoring the social dimension as the industrial civilization Groupthink influence today, can be seen in the post Humanity in 2030: 危機, by José Luis Cordeiro of January 28, 2016. The idea of exponential technologies place “primary emphasis on the design of technical,” is another way of looking at what was suggested the main text is in in the post As The Great Decoupling is driven by TNA anti-systems, What about TAA in systemic civilization?, whose introduction says:
In The Great Decoupling: An Interview with Erik Brynjolfsson and Andrew McAfee, published by the Harvard Business Review, on their June 2015 issue,  the interviewers Amy Bernstein and Anand Ramansay wrote that:
Technological progress makes the world better but also brings new challenges, say Erik Brynjolfsson and Andrew McAfee, faculty members at the MIT Sloan School of Management, who have studied the impact of technology on economies for years. Their most recent book, "The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies," took an upbeat view of the high-tech future. But since its 2014 publication, the two academics have been grappling with a problem whose dimensions surprise even them: why digital innovations are contributing to the stagnation in average incomes in the United States and to the disappearance of so many middle-level jobs.
As TNA and TAA, meant There's No Alternative and There's An Alternative, respectively, on dark and bright technologies, we now add that one big difference between their approach just on technology and that of Carlota Pérez, which was given, for example, by John Bessant's simplification [8] of the model of a paper by Freeman and Pérez that classified technological change in the following types of innovations: Incremental. Radical, New technology system and New techno-economic paradigm. Here we are only concerned what he described as follows:
Lastly come technological changes which involve not only changes in technology but also in the social and economic fabric in which they are located.  Such ‘revolutions’ do not occur frequently, but their influence is pervasive and long lasting. For example, the role of steam power as a technology was not confined to radical improvements in the coal-mining industries. It was the catalyst for the Industrial Revolution, and its development and application set patterns which dominated economic growth for many decades to follow.  
Well in agreement with the above, the book "The Second Machine Age," (but not with its mistaken concept: while the industrial civilization was a machine age, the systemic civilization is an organic age) claim that the steam engine was the key technology of the industrial civilization. However, the steam engine was only in its second technological revolution, and is considered together with railways the key to the Victorian prosperity. The first technological revolution of the industrial revolution corresponds to early mechanization, where factories, wind power, and cotton were key elements, that according to Bessant (1) “involve a cluster of key technologies... and thus fuel economic expansion...” to which we add by mutually reinforcing each other.

Continuing with what Bessant wrote under quotes, the above is the first characteristic of the “Long Wave Model,” which has additional characteristics:  
(2) each technological revolution lead to a downturn, (3)”The emergence of economic growth comes primarily through established ‘carrier’ industries, which are able to exploit the opportunities opened up by the technology clusters. “ (4) “During each new cluster new industries also begin to grow and, although only in embryonic form in the current wave, these play a key role as carrier industries in the next. “ (5) Each technological revolution is not only concerned with technological clusters but also has dominant organizational forms associated with it. These set the pattern for organization and management for the next ‘era’ … (6) Finally, the impetus for change does not come solely from the emergence of new technologies (technology push) but also from growing problems and experience of limitations with the technologies and organizational forms associated with the previous technological revolution.
Comming back to the above mentioned tendency to "fall back" under Groupthink, this can be seen in the summary of the January 2010 post A Better Decade Require the End of the Prevailing Style of Management, that says “As suggested by W. Edwards Deming, the main barrier to basic innovations, like the EWPC-AF, and an increased standard of living, is the prevailing style of management. A better decade is thus dependent on the adoption of Deming’s System of Profound Knowledge.” Shifting to the energy side is related to the EWPC-AF, which is the Electricity Without Price Controls Architecture Framework. One key support to the second example as a source to address global society collapse is that of the electric power industry Groupthink ignorance of the social dimension that can be taken from the post A complete and fully functional electricity restructuring proposal, that says:
Back in 1978, the late MIT professor Fred C. Schweppe, “… introduced the concept of a societal definition of a blackout to contrast it to the technical definition that is being used in the United States, China and other countries said to be following suit with smart-grid projects. Once that is understood, the public will respond by having supplemental energy sources.
As a follow up to that quote, there was a strong warning made by Schweppe and his team that said: "We believe the deregulation which considers only the supply side of the supply-demand equation is dangerous and could have very negative results [9]," which was not considered, for example, under Groupthink close-mindedness. In addition, as can be seen in the “First update” of the post World Economic Forum Davos 2016: Will #OWS and #15M love The Industrialist’s Dilemma?, we have one recent example of Groupthink conformity with its rejection, as can be seen in the introduction of the update that says:
Under the very timely article The World Is More Unequal Than Ever. Is That Because of Technology?, written by Michael Reilly on January 20, 2016, for MIT's Technology Review magazine, the following original comment (edited of course for that context) was submitted (but not accepted as of 11:30 am):
As can also be seen below, the above update being censored and mind guarded end like this:
Similar Strategic Myopia is what's been happening to the representative democracy of the industrial civilization, which has expanded its capacity, this time way beyond what the global socio economy needed. As the disruptive technologies enable direct democracy pro systemic markets, representative democracy reduction will return the much needed balance to reverse decreasing inequality.



The main difference between representative and direct democracy can be associated with complexity and simplicity respectively. After I heard Thomas Frank talk about complexity, we search his book and found this two paragraphs, the first of which is under the section “Consensus of the willing:”
All the thngs mentioned so far – the fascination with complexity, the desire to preserve existing players, the genuflection before expertise – all of them arise from one of the deepest wellsprings of liberal thought and action: the longing for a grand consensus of professional class that never seems to come. 
A forgotten school of left-wing historians used to argue that the regulatory state began not with public-minded statesmen cracking the whip and taming big biz, but just the opposite – with business leaders deliberately inviting federal regulation as a way to build barriers to entry and give their cartels the protection of law. Long-ago giants of steel, tobacco, telephones, and meatpacking all welcome federal regulation because of the effects it would have on smaller competitors. That old style of regulation brought ancillary benefits to the public, of course: better food, a standardized phone system. But its main objects were stability for existing businesses and guarantee profits in perpetuity.”
The issue of complexity is so critical, that we are repeating in full the EWPC post Is Power Industry Regulation Helping Crush the Life Out of America’s Economy?
Is the power industry one important instance of the Over-regulated America: the home of laissez-faire is being suffocated by excessive and badly written regulation, as The Economist documents in an article published on February 18th, 2012? Yes! As can be easily shown, the power industry is over-regulated. As a solution, The Economist suggests “A plea for simplicity,” identifying at the very end of the article “a real danger: that regulation may crush the life out of America’s economy.”

The origin of said over-regulation is that there is a huge mistake at the policy level architecture in EPAct 92 that has remained in place. Unless that critical mistake is addressed, it will be impossible to simplify the regulations. In order to introduce simplicity for the industry as a whole, one approach suggested is in the Electricity Without Price Controls Architecture Framework (EWPC-AF), whose summary read:
A new approach to power energy policy design, based on system’s architecting heuristics, has led to an emerging simplified synthesis of the power industry regulatory policy. Instead of undergoing business as usual regulatory proceedings, the approach to the Electricity Without Price Controls Architecture Framework is poised to replace the Investor Owned Utilities Architecture Framework and its incremental extensions that have evolved by analytic patchwork as a extremely complex system. 
It is easy to agree with The Economist that “… red tape in America is no laughing matter. The problem is not the rules that are self-evidently absurd. It is the ones that sound reasonable on their own but impose a huge burden collectively. America is meant to be the home of laissez-faire… Americans are supposed to be free to choose, for better or for worse. Yet for some time America has been straying from this ideal.”
Although the regulation of the power industry is excessive, I would no say it is badly written. Instead, I argue above that it is badly designed. The main design problem with smart grid policy comes from the architecting assumption that a system-of-systems will do. By itself, the idea of system-of-systems is fine. What is wrong with the approach taken is that the systems are the existing systems that have continuously disintegrated the regulations via incremental extensions. Instead, what are needed are the emerging systems of the power industry as a whole. 
In all three dimensions, where consensus doesn't work, as the future is by far not a continuation of the past, which are rephrased as complexity, statu quo and experts under the personality ethics are in sharp contrast with loving simplicity, destructive creation and character ethic talent - the "Segunda actualización. Por qué necesitamos santificar la desregulación del mercado de comercialización de electricidad (Second update. Why we need to santify the deregulated retail electrity market) of the post Simplicidad (Simplicity), which is based on Jack Trout's book "The Power Of Simplicity: A Management Guide to Cutting Through the Nonsense and Doing Things Right." 

All three dimensions shift enable the “Ninth update. Countries must leap into Hagel’s electoral strategy of trajectory on Handy’s curve of systemic civilization” of the post Can we agree with the Second Curve, while not with Handy?, from where it emerged the following strategic intent synthesis as deregulation leads to the co-creation of individual experiences by customers:
The experience curve of the industrial civilization corresponds to the final area that is so saturated that even doesn’t allow innovators to crawl. No matter who wins the election, we will have unstable equilibrium by getting fatter governments.

On the new curve of the systemic civilization to which countries must leap, we can start with the Systemic Electricity Law, so that people can co-create in social networks, with plenty of room for innovators to crawl, walk, run and then fly. This is how we will go to the market State equilibrium.
In fact, repeating from above that “Margaret Thatcher and Ronald Reagan tried, but failed, to shrink the state,” is exactly what is meant by the “Strategic Myopia” of “the representative democracy of the industrial civilization, which has expanded its capacity, this time way beyond what the global socio economy needed.” It should be clear that we are facing an outright collapse of global society in the making by the expansion of the industrial civilization, as suggested by The World Economic Forum on “The Fourth Industrial Revolution.” In order avoid said collapse, the above mentioned third update said "there is a lot of support available through this blog, which is open to extensive changes, to support a call to organize a pro system coalition 'without a stake in the current' undeniable Groupthink representative democracy anti-system." Recently the alternative to strategy with a systemic electricity law has taken its place. Nontheless, such a coalition might still be an alternative strategy.

This is where the article Exporting the Chinese Model, by Francis Fukuyama, a senior fellow at Stanford University and Director of the Center on Democracy, Development and the Rule of Law doesn't make sense under systemic thinking. His most recent book is Political Order and Political Decay, is very timely. Describing still another expansion of the industrial civilization, Fukuyama wrote:
In 2013, President Xi Jinping announced a massive initiative called “One Belt, One Road,” which would transform the economic core of Eurasia. The One Belt component consists of rail links from western China through Central Asia and thence to Europe, the Middle East, and South Asia. The strangely named One Road component consists of ports and facilities to increase seaborne traffic from East Asia and connect these countries to the One Belt, giving them a way to move their goods overland, rather than across two oceans, as they currently do.

In response to the tweet that carried Fukuyama’s article, I wrote the tweet “Is China repeating its mistake at the start of a civilization now the systemic civilization?,” that added a link to this post. That mistake was at the start of the industrial civilization.

Then by reinterpreting a suggestion of his recent book, I added a tweet with a "Call for Global Declaration of interdependence coalition,” with an image whose introduction says “This is a call for Global Declaration of interdependence coalition.

Under systemic thinking it is very valuable to take history in account, learning from the old past, and also from the emergent future. Skillful and patient leadership and a clear agenda are available for the systemic civilization. The shock is also here.” To conclude this update, we may now change what Fukuyama said about the US, “Persuading them to rethink its most basic tenets short of an outright system collapse is highly unlikely. So we have a problem,” as “Persuading them to rethink its most basic tenets after an outright system collapse is highly likely. So we no longer have a problem.”

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Janis research yielded eight symptoms which severely dampened the effectiveness of group decisions, which he classified under three groups:

1. Overestimation of the group’s power, influence and morality
  • Omnipotence – the Group generates an internal sense of invulnerability, leading to excessive optimism and risk taking.
  • Morality – the Team develops a cult-like belief in their purpose, causing members to ignore the consequences of their actions.
2. Close-mindedness
  • Rationalization – the Group justifies and ignores warnings that might challenge their assumptions.
  • Stereotyping – the Team classifies those opposed to the group as weak, biased, stupid, etc.
3. Pressures of group conformity
  • Censorship – the Group suppresses ideas that deviate from harmony and conformity.
  • False Agreement – the Team interprets silence as agreement, leading to implied consensus.
  • Pressure – the Group places ‘peer pressure’ on members that raise questions branding them as ‘disloyal’.
  • Mind Guards – the Team develops self-appointed individuals who shield members from external information which contradicts the team viewpoint.
References:
[1] Jared Diamond (2005), “Collapse: how societies choose to fail or succeed,” Penguin Books 2006.
[2] Levitt, T. (1960). "Marketing Myopia," Harvard Business Review.
[3] Gareth Morgan (1986, 2006), Images of Organizations, Sage Publications.
[4] Carlota Pérez (2002), “Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages,” Edward Elgar.
[5] Rosa Brooks(2014), “A Call to Rally: ‘The Fourth Revolution,’ by John Micklethwait and Adrian Wooldridge,” The New York Times.
[6] Thomas Frank (2016), "Listen, Liberal: Or, What Ever Happened to the Party of the People?, Henry Holt and Company
[7] Stephen R. Covey (1990), "The 7 Habits of Highly Effective People," Free Press
[8] John Bessant (1991), “Managing Advanced Manufacturing Technology: the challenges of the Fifth Wave,” NCC Blackwell
[9] Fred Schweppe et al (1988), “Spot Pricing of Electricity,” Kluwer.

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