Posts Tagged ‘minimum wage’

Two academic studies have been made about the effect of Seattle’s minimum wage increase from $9.47 to $15 an hour on food service workers. The increase is taking place over seven years.

A study from Jacob Vigdor of the University of Washington (UW) showed the minimum wage increase was bad for everybody in just about every way. Vigdor, of course, has a clear right-wing political ax to grind. Besides the UW, Vigdor is also a scholar with the American Enterprise Institute (AEI), an institute funded by the Koch brothers and other billionaires opposed to the minimum wage in general. The principal purpose of AEI is to influence public opinion in favor of the billionaires with lies and distortions, as well as truths if possible, disguised as scholarly research papers. It’s all patently propaganda coming from this think tank.

Vigdor has also been a contributing scholar with the Manhatten Institute, another right-wing billionaire-funded so-called think tank, whose principal purpose is the same as the right-wingers at AEI. The sponsors are also opposed to the minimum wage in general.

Quite naturally, the corporate media, both liberal and conservative, reported Vigdor’s negative findings on Seattle’s minimum wage rise as a fact when, in reality, they were fiction. This is how corrupt academia and the corporate news media have become with the influence of billionaire dollars into those fields.

Another, almost completely unreported study of the effects of Seattle’s minimum wage increase from the University of California-Berkeley (UC) showed the exact opposite of Vigdor’s lying propaganda on behalf of Wall Street and other billionaires. Note that the last thing most editors of conservative and liberal news sources, as well as fake news sources such as Fox News, want you to know is that the increase in minimum wages is good for the nation’s economy because it raises the demand for goods and services, rather than provide rising dividends and share prices for billionaire shareholders, which sucks the power out of the economy. That’s why the result of the UC study is unmentionable in the propaganda news media.

According to Michael Reich, lead researcher on the UC team, Vigdor’s research made certain to carefully gerrymander the statistics by omitting nearly half of Seattle’s low paid workers, “by omitting franchises and other businesses with more than one establishment. Seattle’s ordinance is aimed at low-wage, multistate companies, requiring the fastest wage increase to be paid by firms with more than 500 employees worldwide that do not provide health insurance.” In addition, Vigdor’s lying propaganda included only those jobs paying $19 an hour or less in food service, but job gains in higher paid positions in food service far outnumbered job losses in lower paid positions.

What happened? Seattle’s lowest-paid workers began spending their newly raised wages and local businesses began to thrive. When low-wage workers earn more they spend more.

Last February, Marketplace reported that Bill Phelps, CEO of Wetzel’s Pretzels, which grossed $165 million in 2016 from over 300 stores, had opposed minimum wage increases because he feared it would hurt profits, and that sales would fall if he needed to raise prices to compensate. Both times California raised its minimum wage, sales at his California stores immediately shot up. “I was stunned by the business,” Phelps told Marketplace.

This is precisely why all Americans, including wealthy shareholders, have a stake in raising the minimum wage above $15 an hour.

Watch out for the conservative propaganda in which its sole propose is to persuade you of something that benefits the billionaires only and at your expense.

Author of minimum-wage-study-has alarming-alliances–The Progressive

Letter to Seattle mayor from Michael Reich of the University of California-Berkeley


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Source: Economic Policy Institute, http://www.epi.org/publication/charting-wage-stagnation/

More than 40 million US workers would get a raise if the US minimum wage was raised to $15 an hour. Doing so would do five important things to help the US economy.

1. It would increase the demand for goods and services and create jobs in the process. Currently, we are in the worst post World War II economic expansion in US history, except for the last one, you know, that negative job growth under the economic policies of the worst president in US history, George W. Bush! Outside of that expansion, the current expansion is the worst, with the lowest job growth, the least GNP growth, and lots more historically weak statistics.

2. Every US economic expansion since 1981 has been caused by artificial bubbles which have created artificial stock market bubbles, which have almost completely benefited only the rich, and mostly the super rich, at the expense of everyone else. The Bill Clinton presidency saw the creation of 22 million jobs, which came about because of simultaneous housing, tech, stock and telecommunications bubbles. The tech and telecommunication bubbles were created by Clinton’s signature on legislation. The current economic bubble has been created by an illegal housing bubble created by the big banks. See The fix is In! The Banksters are Manipulating the rise in housing prices: Mortgage applications are down for home sales–Johnhively.wordpress.com Raising the minimum wage would create more demand, possibly creating the first demand inspired economic expansion since the Great President Jimmy Carter.

3. Raising the minimum wage to $15 an hour would steer money away from the stock market bubble because it would decrease corporate profits, and perhaps gently deflate the current bubble that is due to burst in a few months anyway. The other option is to allow the bubble to run its course and essentially ruin the US economy like what occurred from 2007 to 2012 and from 1929-1933. The next recession will be worst than the last one, and it’s just around the bend.

4. Income inequality is at an all-time US high with the 1 percent stealing about 37 percent of all income produced in the USA every year compared with only 8 percent in 1980. That means the 99 means we have less money to buy things, while the rich primarily purchase things like stock options, stock, bonds and politicians. This inequality is stifling the demand sector and weakening the economy which is why the US economic expansions since 2000 are the weakest in history. This is, of course, unless, the creation and functioning of the US and worldwide economies are solely for the benefit of the 1 percent, and always at the expense of the 99 percent. You can see from the graph above the rich are stealing $17,867 from every working American, and they do this year after year after year. I think it’s time we get a little of our money back.

5. Wealth inequality is also near an all time high in the USA, and this means (along with income inequality) the rich can afford to buy the services of more politicians, which has already effectively turned our democracy into both an illusion and a myth, and this occurred perhaps as early as 1981. Raising the minimum wage would cut away a bit of the economic cancers known as wealth and income inequality.

The corporate talking heads will also insist raising the minimum wage will result in lost jobs, but there are plenty of studies showing not a whole lot on this issue. Most studies on this subject during the last twenty years show a rise in the minimum wage has a negligible impact on job loss, or jobs experience slight growth. On the other hand, most minimum wage increases that have been studied have been minimal and very local.

However, all of this is irrelevant because there is one gigantic study that shows that when the real wages of the 99 percent go up, so too does the US economy, and not just for the benefit of the few. This study is called the history of the US economy. Notice in the graph below real wages grew in the US economy from 1948 to 1978. In reality, you can go back to 1938 and see the same stuff. Inflation was low and job growth was high during the years 1938 to 1980. The middle class was strongest then, and demand for US goods was incredibly strong, especially the demand from US citizens. Even the rich got richer, although the percentage of income and wealth they could steal from the rest of us was small compared to today.

Source: Economic Policy Institute, http://www.epi.org/publication/charting-wage-stagnation/

Corporate talking heads will always lie and say raising the minimum wage will increase inflation. In reality, allowing the financial markets to rise in bubbles creates inflation, as I pointed out in my book, The Rigged Game.

Now some people will say inflation was fairly high during the 1970s, and yes that is kind of true, and then kind of not. That’s because the US government has changed the way it measures inflation twenty times since 1981, and every change has the intended effect of lowering the rate of inflation. In other words, if inflation is 1.5 percent nowadays, using the methodology of 1975, today’s inflation would be about 6 percent. Average yearly inflation during the 1970s was 7 percent, and so using today’s inflation methodology, inflation during the 1970s would have averaged about 2.5 percent, which isn’t all that much.

You can also see from the graph above how real hourly wages have stagnated since 1978, but of course, that’s a lie since real wage increases are measured against inflation, and we know inflation is no longer measured like it used to be. If inflation over the last 35 years was measured with the methodology used by the US government in 1975, US inflation would be significantly higher each of those years, and real US wage growth during this period would be negative, year after year after year for the last thirty or more years. This means real wages are significantly lower nowadays than the available statistics will allow us to measure, and this, of course, is one of the reasons why the government changed the way it measured inflation: it stops us from seeing how much we of the 99 percent are getting screwed by our corrupt government in redistributing our income and wealth to the 1 percent.

I don’t know about you, but I want my money back! Raise the minimum wage!

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There’s a coming economic storm the likes of which we haven’t seen since the Great Depression. This disaster has been brought on by a government corrupted by the money of the 1 percent, and the legislation and international agreements they’ve bought in the political markets that make up the US senate, US house of representatives, and the White House.

Obviously, a New Deal for all Americans is coming within the next five years. As I’ve been predicting, the disaster will officially strike most likely between October 2016 and June 2017. The full impacts will not be felt for many months afterward. The corporate propaganda machine will, quite naturally, try to distract our attention from the economic tsunami by claiming that the victims were the perpetrators of this heinous mess. The American Enterprise Institute knowingly and falsely blamed the last disaster on the victims.

The question now is, “What should this new deal look like?”

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Obviously we want to halt the rise of income and wealth inequality that has been ongoing for the last thirty-five years. The first thing that needs to be done is stop the Trans Pacific Partnership (TPP). The TPP is an international income and political power redistribution scam on steroids. Tens of millions of US jobs will be exported because of this Wall Street scheme. See The TPP-The Op-ed the Corporate Press Doesn’t Want You to See–JohnHively.wordpress.com

The difference between the higher US pay and the new lower overseas pay will go straight into the pockets of the rich via higher corporate profits, rising dividends and a stock market bubble.

The Economic Policy Institute also has some ideas.

* Use the levers of macroeconomic policy (monetary, fiscal, and exchange-rate policy) to target genuine full employment.
* Make investments that markets are not making—in early childhood education, infrastructure, school construction, energy efficiency, and public health care.
* Strengthen antitrust regulations and look for other opportunities to introduce competition to private markets, such as public options for health insurance and retirement savings. Why is this important? Check out The Big Banks are Manipulating the Housing Market–JohnHively.wordpress.com.
* Reregulate many activities of the financial sector to squeeze out the activities that don’t enhance productivity or create efficiency but simply enrich well-placed actors within finance. A financial transactions tax is the clearest example of a policy that can stop this income skimming.
* Enact climate-change mitigation measures—realizing that policies beyond simply increasing the market price of greenhouse gas emissions can play large and useful roles.
* Strengthen regulations and institutions that help shift bargaining leverage from capital-owners and corporate managers to low- and middle-income workers. Key examples include higher minimum wages and labor law reform that allows willing workers to join unions and bargain collectively.

We should also,

  • Strengthen laws making it easier for labor unions to form and negotiate.
  • Boost the maximum minimum wage to $15 an hour.
  • Put a progressively higher tax rate on income of up to 90 percent, end tax loop holes that allow individuals and corporations to hide money from the tax collector in overseas tax havens.
  • Pass legislation allowing for government funding of political campaigns rather than allowing the highest bidders determine the candidates we choose, or reenact campaign finance laws which stood for over a hundred years until the corrupt corporate wing of the US Supreme Court overturned them with Citizen’s United.
  • End the nonsense that corporations are somehow people via an honest Supreme Court or a Constitutional amendment.

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Bernie Sanders Wall Street
Bernie Sanders issued a statement after he lost four of five states on April 6, 2016. So this primary campaign season isn’t over until it’s over.

Senator Sanders said, “The people in every state in this country should have the right to determine who they want as president and what the agenda of the Democratic Party should be,” Sanders said in a statement congratulating Clinton on her wins. “That’s why we are in this race until the last vote is cast.”

“That is why this campaign is going to the Democratic National Convention in Philadelphia with as many delegates as possible to fight for a progressive party platform that calls for a $15 an hour minimum wage, an end to our disastrous trade policies, a Medicare-for-all health care system, breaking up Wall Street financial institutions, ending fracking in our country, making public colleges and universities tuition free and passing a carbon tax so we can effectively address the planetary crisis of climate change,” the statement read.

It doesn’t sound like Bernie is optimistic that Hillary “Wall Street” Clinton will want any of these objectives in the Democratic Party platform. Win or lose, Sanders wants these issues addressed, and it sounds as if he aims to enter the convention with the strength to force Democrats to enter these issues into the platform, should he fail to win the nomination.

He should also demand that Clinton publicly sign a personal agreement to veto the disastrous Trans Pacific Partnership, which will redistribute trillions of dollars from the 99 to the 1 percent, steal our voting rights on the local and state levels, increase the price of our medications, cause more environmental degradation, and so on and so forth.

Otherwise, Clinton would be just another Wall Street hack, like she and her husband have always been. And that’s good enough reason not to support her, if she wins.

Read more: http://www.politico.com/story/2016/04/2016-primaries-democratic-pennsylvania-maryland-222466#ixzz474eNnDLA
Follow us: @politico on Twitter | Politico on Facebook

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Trade deficit India

India has been told by the World Trade Organization that it cannot go ahead as planned with an ambitious plan for a massive expansion of its renewable energy sector, because it seeks to provide work for the Indian people. The case against India was brought by the United States.

The ruling says India’s National Solar Mission—which would create local jobs, while bringing electricity to millions of people—must be changed because it includes a domestic content clause requiring part of the solar cells to be produced in India.

Stunningly, this ruling was brought about because India and the United States signed on to the Paris agreement combating climate change last December. President Obama praised the deal, but he was swift to invoke the climate accords to stymie India’s efforts to produce jobs for its own citizens.

One official of India’s Ministry of New and Renewable Energy told India Climate Dialogue that the ruling might make the country’s solar plan more expensive and would definitely hit domestic manufacturing and, consequently, the possibility of creating jobs in the sector.

The government-funded program aims to generate 100 gigawatts of solar energy annually by 2022. One gigawatt is enough, for example, to supply the needs of 750,000 typical U.S. homes.

Sam Cossar-Gilbert, economic justice and resisting neoliberalism program co-ordinator at Friends of the Earth International, said the ruling “shows how arcane trade rules can be used to undermine governments that support clean energy and local jobs. The ink is barely dry on the UN Paris agreement, but clearly trade still trumps real action on climate change.”

This is a lesson for people on ways that the Trans Pacific Partnership, a massive income and political power redistribution scam falsely marketed as a trade treaty, will alter US government policy that might benefit the 99 percent in the United States. Your federal and state government’s will be challenged in a secret tribunal over any policies, including raising minimum wages and labeling GMO food content, any foreign corporation arbitrarily decides will roll back its future anticipated profits. And they can make up any numbers they want, for decades into the future.

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income distribution 95 percent

One year after the city of Seatac raised its minimum wage to $15, and after massive outbursts by business leaders of its destructive consequences, K5 News of Seattle reported that the wage increase had not decreased jobs, and in many cases, many businesses have and are expanding.

For example, managers of Cedar Brook Lodge in Seatac threatened to cut jobs if the minimum wage was enacted, but since then, they have expanded their facilities by 63 rooms and increased hiring. Managers at WallyPark, a parking structure, say they’re doing very well. The city manager of Seatac says there are “no noticeable impact on spending or business license applications.”

Most governments phase in minimum wage increases, such as the Seattle city council and the Oregon legislature. Seattle signed into law an increase to $15 an hours in June 2014. Oregon just recently increased its minimum wage to a phased in over six years $14.75 per hour.

The Seatac increase, however, had no incremental phase in period for the minimum wage. It was $15 an hour and charge!

As Seattle’s new minimum wage began to take effect last year, four restaurants closed. Conservative and libertarian news media and think tanks bragged that this was due to the increase in the minimum wage, and they did so without uncovering any facts.

It turns out the claim was false. One restaurant owner said they were simply moving his business to another section of Seattle. Another owner said she was closing one restaurant because she intended to open two others in Seattle. A third owner said the minimum wage increase had nothing to do with closing her business. The fourth owner said the same thing. In the meantime, new restaurants opened in all four locations.

As for who the minimum wage increase actually impacts?

A valet attendant and shuttle driver at a parking company called MasterPark, Sammi Babakrkhil saw his base wage jump from $9.55 per hour, before tips, up to $15. Having scraped by in America since immigrating from Afghanistan 11 years ago, he suddenly faced the pleasant predicament as his co-workers: What to do with the windfall?

For the overworked father of three, it wasn’t a hard question what he would do with an increase in wages. Babakrkhil decided to quit his other full-time job driving shuttles at a hotel down the road. Though he’d take home less money overall, the pay hike at MasterPark would allow him to work 40 hours a week instead of a brutal 80 — and to actually spend time with his wife and three young girls.

“My kids used to not see me,” said Babakrkhil, who notes that the new work arrangement has also afforded him time to start exercising. “Now I make a little bit less, but I’m enjoying my life … I’m happy this way.”

Wait a minute! Sammi quit a job, which means a job opened up due to the minimum wage. That increased employment.

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15 dollars

People earning the federal minimum wage of $7.25 aren’t going out to eat at restaurants because they can’t afford to do so. That’s pretty much true for those who make higher state minimum wages of nine and ten dollars an hours. These people are not taking yoga, piano, or karate lessons. They don’t belong to gyms, and they don’t take part in yoga classes. They purchase few if any new books, and buy clothes at second hand stores, like the local Goodwill. They don’t buy flowers for their mother’s on mother’s day. They’re not purchasing new computers, cameras, tables, chairs, carpets, washing machines, dryers, I-phones, cars, organic food, or houses. They’re not buying a lot of other things.

What good are these people to the economy, other than to provide rich people with cheap labor? Like the idle rich, minimum wage workers barely stimulate demand for goods and services.

What do low wages have to do to with rich people? Low wages boost profits. As a consequence of that, corporate dividends and share prices go up. People who earn less than $100,000 a year own hardly any shares of corporations. The primary beneficiaries of people working at minimum wages go primarily to the rich.

If you raise the minimum wage to $15 an hour, the people who benefit from this raise will be buying a lot of the things listed above and more, even a house in Detroit, Michigan, and elsewhere, as well.

And all of a sudden, not just large businesses, but small businesses thrive because demand for goods and services is stronger.

Studies over the last fifteen years show that the idea that high wages weakens employment is a myth.

There are two fundamental laws of capitalism. One is something about supply and demand, which is often rigged in favor of those who believe and act upon the golden rule; he who has the gold makes the rules. The other rule, which Henry Ford (the founder of the Ford Motor Company) believed was simple: When people have more money, businesses have more customers, and need more workers.

This explains why the current economic expansion is the worst since the Great Depression in virtually every category having to do with jobs, wages, GNP, and the things that are important to 99 percent of the US population.

Currently, 1 percent of the population has rigged the economic and political games over the last thirty-five years to the point where they have received a legislatively determined 95 percent of all income growth since 2009, the most ever on record. Worse yet, the rich steal 37 percent of all income produced in the United States nowadays, and that figure is growing, and with no end in sight. Rich parasites will soon be larger in terms of total income than their hosts, the 99 percent.

Ever wonder why the economy under President Jimmy Carter produced more jobs, raised wages, and had greater GNP growth on average than any year of the last fifteen with an economy that was ½ the size of today, and with a population that was 60 percent the size of today? The answer is simple.

Back then, the rich only stole 8 percent of the annual income produced in the United States. That means the rest of us earned 92 percent of all the income created in the USA, which meant demand for goods and services was far more plentiful then than today, job growth was greater, and wages for the 99 percent also rose. Under Carter, the economy created 225,000 jobs a month. Over the last fifteen years, 90,000 has been hailed as an outstanding achievement by President George W. Bush, as well as President Obama.

Something clearly is out of whack with the economy, and yes, most of it has to do with the massive corruption of the US government that was unleashed by the Reagan tax cuts. But if income can be massively redistributed from the 99 to the 1 percent, as it has been for the last thirty-five years, then the government can act to redistribute it back to where it belongs, and all for the good of the economy. This can partially be achieved by raising the minimum wage to $15 an hour by 2017.

And don’t tell me corporate America doesn’t have the money. Currently, they’re sitting on 7-8 trillion dollars inside the US, while holding another 7-8 trillion outside the US, because the demand for goods and services is so low they have no reason to invest it in new plant and equipment so as to increase production, which would require workers.

You can go back 150 years and literally find the same people shouting over and over again on behalf of their rich patrons saying the same thing, “If people on the bottom get paid more, it will be bad for them, and they will lose their jobs.” That’s just a polite way of saying, “My patrons and I are rich, you’re poor, and my boss and I want to keep it that way. And besides, it’s good for Wall Street.”

The fact that corporations are sitting on trillions upon trillions of dollars because demand is slack shows the opposite is true. Every one of those trillions of dollars could be used to create jobs if only the demand was there. The years between President Franklin Roosevelt and Ronald Reagan also show the same thing.

If you pay people more, they will purchase more, and everybody will be better off, not just a few politically powerful people. Those trillions of dollars will be used to invest in the production of goods and services. Those trillions also show that US corporations are quite capable of paying their employees more, and not just the already rich CEOs.

That’s why it’s long past time to raise the minimum wage to $15 an hour. Besides, if the minimum wage had kept up with productivity (or real inflation) over the last 56 years, the US federal minimum wage would be nearly twenty dollars an hour.

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10982694_10153063567881765_6243820495717904854_nphoto by Shawn Sorensen

Bernie Sanders brought his campaign for the US presidency to Portland Oregon and began his speech by saying that his campaign has been about bringing people together. “This is by far the largest crowd, 20,000 people.” Bernie was slightly off the mark, but I’ll get to that in a bit.

He went on to say, “There is no president who will fight harder to end institutional racism in this country and to reform our criminal justice system. In this nation we have the distinction of having more people incarcerated than any other nation in the world.”

Then Bernie went into economic policies calling the current state of the economy the worst since the Great Depression. “We say that this nation belongs to all of us, not just a hand full of billionaires.” He vowed to change the economic system that only benefits the billionaire.

Bernie also called the current state of wealth and income inequality in the USA “the moral issue of our time.” The senator failed to mention that such inequality is also bad economics. Sanders called for a $15 an hour minimum wage, which is way past due since the minimum wage would be well over $18 an hour if it had kept up with productivity growth since 1969.

Bernie didn’t draw 20,000 people, as he claimed at the beginning of his speech. He drew 28,000, 8000 of whom couldn’t jam into the already overflowing MODA Center.

This shows that Americans are beginning to listen, and the grassroots organizing is growing by leaps and bounds, and that the billionaires can be beat.

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The City of Los Angeles Raises the Minimum Wage to $15 An Hour

Los Angeles became the largest US city to raise its minimum wage to $15 an hour on Tuesday, as a wage increase bill passed the city council by a vote of 14-1.

It is now up to city attorney Mike Feuer to draft an ordinance to implement the new minimum wage requirements. The ordinance will then return to the council for a final vote before becoming law. Under the proposed legislation, the city’s minimum wage would increase to $10.50 in July 2016, and would increase incrementally every year until it reaches $15 in July 2020. For small businesses with 25 or fewer employees, the wage hike would come on a modified schedule with the incremental increases starting in July 2017 and the minimum wage reaching $15 by July 2021.
Seattle workers hail ‘historic moment’ as city sets course for $15 minimum wage
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The current minimum wage in California is $9 an hour and is set to increase to $10 in January 2016.

In the past year, two other US cities have approved similar wage increase measures. In June 2014, Seattle moved to increase its minimum wage to $15 by 2017. Last November, San Francisco voted to increase its minimum wage to $15 by 2018.

Not meaning to sound negative, but the official inflation rate is only a tiny fraction of what the real inflation rate is. Since 1980, the US government has revised the way it determines inflation twenty times, and each time tended to make the official inflation rate smaller. The real inflation rate is about 7.5 percent per year.

Five years from now, that $15 an hour in Los Angeles will only be worth roughly $12 in today’s reality.

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From US Uncut:

“The Fight for $15 made history this week as three of the nation’s largest cities jumped on board. And today, Bernie Sanders and Elizabeth Warren were joined by 16 fellow Senators announcing their support for $15/hour for the first time ever, demanding President Obama take executive action and raise contract workers wages. We will keep everyone updated as these measures progress, but this is a lesson to never underestimate your own power–not for a second. When the Fight for $15 began two years ago, it was dismissed as a utopian pipe-dream. Now, $15/hour is quickly becoming a political reality across the country. This is the power of organized workers. If you support Fight for $15 at your work, in the streets, or behind your keyboard, take a bow. We aren’t going to win, we are winning!”

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