Cablegate: Japanese Morning Press Highlights 10/06/09

DE RUEHKO #2311/01 2790023
P 060023Z OCT 09




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1) Top headlines
2) Editorials
3) Prime Minister's daily schedule (Nikkei)

Foreign Relations
4) Chairman of SDP's policy board visits Afghanistan (Sankei)
5) Hatoyama to meet with British vice foreign minister (Yomiuri)
6) FM Okada and French special envoy agree to work closely for
resolution of North Korean nuclear issue (Yomiuri)

7) Kazuo Inamori tapped for Administrative Reform Council (Asahi)
8) Ruling parties to hold party secretary general meeting today
9) Special diet session to be convened on Oct. 26 (Asahi)
10) LDP serious about pursuing issue of political contributions to
Hatoyama (Nikkei)
11) LDP's Ishiba calls for debate of law authorizing refueling
mission (Nikkei)

12) Kyodo poll reveals 57 PERCENT of DPJ Lower House members
approve of a consumption tax hike (Tokyo Shimbun)

13) Japanese Government offers rescue plan for two U.S. firms
14) Transport minister unveils policy to boost growth in tourism and
three other areas (Nikkei)
15) Gap between DPJ and SDP/PNP on debt-repayment moratorium and
nuclear energy policy (Yomiuri)

Defense & Security
16) Parliamentary Defense Secretary calls for revision of law to
allow refueling mission to continue (Sankei)
17) ASDF to disclose records of air transport activities in Iraq
(Tokyo Shimbun)



Government to appoint Inamori, Mogi, and Katayama as members of
Administrative Reform Council

Government mulling issuing new government bonds to make up for tax
revenue shortfall

Arrested trading company president asked to send reagents for
detecting radiation exposure in 2,500 people to North Korea a month
before nuclear test

Health ministry plans to increase government spending on health
insurance for smaller firms' employees


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NHK officials visited Taiwan to urge those who filed complaints over
biased NHK program to withdraw their protests

Tokyo Shimbun:
Information on Iraq airlift mission disclosed under new
administration; 67 PERCENT of transported personnel since July 2006
were U.S. troops

Burden for medical insurance system for people 75 and older to
increase next April if it is not abolished


(1) Hatoyama donation scandal: Prime Minister must offer thorough
explanation without waiting for investigation
(2) New EU treaty brings new trend of stronger Europe

(1) Legislation of National Strategy Bureau imperative
(2) Introduction of separate surname system requires thorough

(1) G-4 concept: Will the new framework function?
(2) Iran must swiftly implement the agreement to move enriched
uranium out of country

(1) Japan must earnestly face EU, which is gaining strength owing to
new treaty
(2) New system introduced to increase local fiscal discipline

(1) Rapprochement between China and North Korea: Japan must adhere
to pressure policy
(2) Irrationality in mixed medical treatment must be rectified

Tokyo Shimbun:
(1) Planned abolition of provisional tax rates: Tax system
inseparable from environment
(2) Rio de Janeiro to host 2016 Olympics: Take advantage of this new

(1) Akashi pedestrian bridge accident: Bereaved families' feelings
must be taken seriously

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, October 5

NIKKEI (Page 2) (Full)
October 6, 2009

09:29 Arrived at the Prime Minister's Official Residence (Kantei).
11:41 Made a condolence call at the private residence of the late
former finance minister Shoichi Nakagawa.
12:43 Met Chief Cabinet Secretary Hirano at the Kantei.
14:35 Met Hirano at the Kantei, followed by British minister for
private firms and deregulation Mandelson.

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16:00 Met State Minister for National Strategy Bureau Kan.
18;37 Dined with his wife, Miyuki, and professional baseball player
Lee of the Yomiuri Giants at a Korean restaurant in Daiba.
21:35 Returned to his private residence.

4) SDP policy chief arrives in Afghanistan

SANKEI (Page 5) (Full)
October 6, 2009


KABUL-Tomoko Abe, chair of the Social Democratic Party's policy
board, arrived yesterday in the Afghan capital city of Kabul with
Ryoichi Hattori, an SDP lawmaker in the House of Representatives, to
study specific measures for Japan to assist with Afghanistan's
reconstruction instead of continuing the Maritime Self-Defense
Force's refueling activities in the Indian Ocean. They are scheduled
to stay in Afghanistan until Oct. 9.

5) Prime Minister Hatoyama meets with British First Secretary of
State Mandelson

YOMIURI (Page 4) (Full)
October 6, 2009

Prime Minister Yukio Hatoyama yesterday held talks with British
First Secretary of State Peter Mandelson at the Prime Minister's
Official Residence (Kantei). In the meeting, Mandelson asked
Hatoyama to continue the Maritime Self-Defense Force's refueling
mission in the Indian Ocean. Hatoyama responded by saying, "We would
like to consider the issue from the viewpoint of what sort of
cooperation would be appreciated by the Afghan people and the
countries engaged in the war on terror."

6) Foreign Minister Okada, French envoy to North Korea agree to
closely cooperate in resolving North Korean nuclear issue

YOMIURI (Page 4) (Full)
October 6, 2009

Foreign Minister Katsuya Okada met yesterday with French special
envoy to North Korea Jack Lang at the Foreign Ministry. During the
meeting, they agreed that their countries will closely cooperate to
resolve the North Korean nuclear and missile issues. In response to
Okada's request for France's cooperation on the issue of abductions
of Japanese nationals by North Korea, Lang said, "I understand the
importance of the issue."

7) Inamori picked as Administrative Reform Council member: Mogi,
Katayama also to be tapped

ASAHI (Top play) (Full)
October 6, 2009

The lineup of the Administrative Reform Council, which the Hatoyama
cabinet has established for the purpose of identifying wasteful
spending of tax revenues, has been decided. State Minister for
Administrative Reform Council Yoshiro Sengoku on October 5 decided
to appoint from private companies Kazuo Inamori (77), the honorary
chairman of Kyocera Corp. and Yuzaburo Mogi (74), representative
director of Kikkoman Corp., as key council members. From among those

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who have served as head of a local government, Sengoku plans to tap
Yoshihiro Katayama (58), former Tottori governor.

Eleven persons - six politicians and six private citizens - are
expected to serve as the key members of the council. Prime Minister
Yukio Hatoyama will serve as chairman and Sengoku as vice chairman.
Deputy Prime Minister and State Minister for National Strategy
Bureau Naoto Kan and Finance Minister Hirohisa Fujii will join from
among politicians.

Inamori has a close relationship with Democratic Party of Japan
(DPJ) Secretary General Ichiro Ozawa. His presence is known as a
sort of "guardian" of the DPJ. From among private citizens, former
Japanese Trade Union Confederation (Rengo) Secretariat chief
Tadayoshi Kusano (65), who is well-versed in labor issues, has also
been picked. The appointment of Hideki Kato, representative of Japan
Initiative, a private-sector think-tank, as the chief of the
secretariat and a council member, has also been fixed.

The Administrative Reform Council is tasked with securing funding
resources to finance new policies such as the child care allowance
to be incorporated in the fiscal 2010 budget. The cabinet intends to
have Inamori and Mogi use the knowledge in corporate management that
they have acquired through many years of experience in order to make
more efficient administration possible.

The Council will also put the desired nature of central and local
governments, including decentralization, on the agenda. Sengoku
selected candidates from among persons who have served as heads of
local governments and decided to appoint Katayama, who has served as
a prefectural governor.

The Council will hold its first meeting as early as late October and
proceed with the initial work of identifying wasteful spending of
tax revenues.

8) Secretaries general of ruling parties to hold meeting today

NIKKEI (Page 2) (Full)
October 6, 2009

The secretaries general of the ruling Democratic Party of Japan
(DPJ) and its coalition partners -- the Social Democratic Party
(SDP) and the People's New Party (PNP) -- will hold their first
meeting since the inauguration of the coalition government. They are
expected to discuss such issues as how to coordinate views among the
three parties regarding policy-making within the coalition

9) Extra Diet session to convene on Oct. 26

ASAHI (Page 1) (Full)
October 6, 2009

Prime Minister Yukio Hatoyama yesterday decided to convene an
extraordinary Diet session as early as Oct. 26 immediately after
Upper House by-elections in Kanagawa and Shizuoka prefectures.
Hatoyama prioritizes compiling the budget for fiscal 2010 by the end
of this year in order to translate his party's manifesto (a set of
campaign pledges) into action, so he intends to schedule the extra
session for about a month.

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By convening the extra session soon after the Upper House
by-elections, Hatoyama appears to have decided to prevent debate at
the session with the opposition Liberal Democratic Party (LDP) on
the issue of his political fund management organization's false
reports from having a negative impact on the elections. Moreover, if
this issue is pursued in the Diet over a long period of time, it
could be a minus to his administration. He therefore appears to be
trying to avoid such a situation by setting a short Diet session. He
intends to narrow down the number of bills to be submitted to the

10) LDP to earnestly pursue Hatoyama donation scandal

NIKKEI (Page 2) (Excerpts)
October 6, 2009

The Tokyo District Public Prosecutors Office has launched an
investigation into political funds reports produced by Prime
Minister Yukio Hatoyama's political-fund management organization.
Meanwhile, the major opposition Liberal Democratic Party (LDP)
intends to grill the Prime Minister over the donation scandal by
positioning veteran lawmakers at key posts. Whether the LDP can turn
the tables remains to be seen.

In an interview yesterday with the Nikkei and other media outlets,
Policy Research Council Chairman Shigeru Ishiba harshly criticized
the Prime Minister's response, saying, "If he thinks that it is
acceptable because it was his own money, he is wrong. This is a
serious violation of the law." Secretary General Tadamori Oshima,
too, emphatically said to the press corps: "If the Prime Minister
cannot offer an adequate explanation to the public in a responsible
manner, we will have to question him in detail at the Diet."

The LDP is making arrangements to appoint former Chief Cabinet
Secretary Nobutaka Machimura as the principal director of the House
of Representatives Budget Committee where the donation scandal will
be pursued. The LDP is also considering allowing a veteran lawmaker
to concurrently serve as a member of the shadow cabinet (tentative
name) and as the principal director of a standing Diet committee.
The LDP's strategy is to pit its seasoned lawmakers against the
Hatoyama cabinet which is composed mostly of first-time cabinet

11) LDP Policy Research Council chief calls for discussion on
permanent law for continuation of refueling mission

NIKKEI (Page 2) (Full)
October 6, 2009

Liberal Democratic Party (LDP) Policy Research Council Chairman
Shigeru Ishiba gave an interview to the Nikkei and other media
outlets yesterday. Touching on the Maritime Self-Defense Force's
refueling mission in the Indian Ocean, Ishiba said: "Informal
discussions have been conducted with the Democratic Party of Japan
(DPJ). We want to discuss a general law." Ishiba thus revealed the
view that (the LDP and DPJ) should look into a permanent law
(allowing the government) to dispatch the Self-Defense Forces
overseas whenever necessary for the continuation of the operation.

Ishiba also raised questions about providing civilian aid to
Afghanistan, an option the Hatoyama cabinet is currently
considering, saying, "Who is going to ensure safety? Will an

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organization which cannot ensure its own safety be able to conduct
effective activities?"

12) Poll of DPJ Lower House lawmakers: 57 PERCENT approve of
consumption tax hike, 62 PERCENT see need for additional stimulus

TOKYO SHIMBUN (Page 3) (Abridged)
October 6, 2009

Kyodo News recently conducted a questionnaire survey of 308
Democratic Party of Japan (DPJ) lawmakers elected in this summer's
election for the House of Representatives. In the survey, 57.6
PERCENT of respondents answered "yes" when asked if the consumption
tax should be raised in the future for a drastic review of the
nation's pension system. Prime Minister Hatoyama has decided not to
raise the consumption tax for the next four years. However, the
government's spending on social security has been increasing due to
the nation's aging population with fewer children. Under such
circumstances, the survey shows that many of the DPJ's lawmakers are
in favor of raising the consumption tax in the future.

Asked about a possible slowdown of the nation's economy, 62.4
PERCENT of respondents answered that the government should take
additional measures this fall. However, 64.3 PERCENT said the
government should not issue any more deficit-covering bonds. The
figure shows that the majority of the DPJ's lawmakers are trying to
avoid increasing the government's debt. Meanwhile, 77.1 PERCENT
said the government, after abolishing gasoline and other
road-related taxes, should introduce a carbon tax or other similar
tax in order to address global warming.

Hatoyama has pledged to reduce Japan's greenhouse gas emissions 25
PERCENT below 1990 levels by 2020. Asked about this goal, 90.5
PERCENT said it was appropriate.

Answers were obtained from 210 persons or 68.2 PERCENT of the DPJ's
lawmakers elected in the House of Representatives election.

13) Japanese government found to have drafted plan to bail out two
U.S. companies

MAINICHI (Page 1) (Abridged slightly)
October 6, 2009

The Mainichi Shimbun has learned through interviews with
knowledgeable sources that the Japanese government had considered
providing assistance from foreign currency reserves to two U.S.
government-affiliated housing loan corporations in late August 2008,
when they were facing a management crisis. Its plan was to purchase
the two companies' corporate bonds worth several trillion yen,
because there was concern that no one would bid on the open tenders
for their corporate bonds. The world was on the brink of plunging
into a financial crisis at the time. Even so, it is very unusual for
any government to use public money to bail out foreign financial
institutions. The case would seem to reveal the unique nature of
Japan-U.S. relations.

The two financial institutions in question are Freddie Mac and
Fannie Mae, both of which had been securitizing funds procured from
the issue of corporate bonds and selling the securities to
investors. The total amount of outstanding residential

TOKYO 00002311 007 OF 011

mortgage-backed securities issued by the two companies stood at
roughly 6 trillion dollars, or approximately 540 trillion yen,
accounting for 50 percent of the total amount of outstanding housing
loans in the U.S. Many financial institutions in the world owned
those securities. The failure of the two companies would certainly
have had a serious impact on the global financial system.

The management crisis at both companies surfaced in July 2008. The
U.S. government announced setting up an investment framework of up
to 400 billion dollars, or 36 trillion yen, in mid-July. However,
the market did not calm.

A small number of senior Finance Ministry officials, in close
cooperation with the U.S. Treasury Department, mapped out a plan
named " Operation Rescue," under which Japan was to purchase both
companies' corporate bonds, releasing several trillion yen from the
government's foreign currency reserves.

However, then Finance Minister Ibuki remained cautious about the
plan. In addition, the government became dysfunctional as Prime
Minister Yasuo Fukuda announced his resignation. As a result, the
plan was not realized. The U.S. government bailed out the two
companies, by nationalizing them with an injection of public funds
on Sept. 7. Lehman Brothers imploded on Sept. 15.

Former finance minister Ibuki told a Mainichi Shimbun reporter: "The
plan never advanced to the stage requiring clearance from the
finance minister. However, my decision that the government should
not purchase assets that could lead to losses in foreign currency
reserves in the face of the impending U.S.-induced economic crisis
was only natural."

14) Transport minister eyes growth strategies for four areas,
including tourism

NIKKEI (Page 5) (Full)
October 6, 2009

In a speech in Tokyo yesterday, Land, Infrastructure, Transport and
Tourism Minister Seiji Maehara said the ministry will draw up
strategies for growth in four areas, including tourism.
Specifically, he cited the need to (1) increase the number of
foreign tourists; (2) revitalize the aviation industry by
liberalizing aviation services; (3) raise the competitiveness of
ports to the level of Singapore and Pusan; and (4) internationalize
the transport and construction industries by exporting Shinkansen
bullet trains and helping general contractors expand overseas.

15) DPJ fed up with demands by SDP, PNP deviating from pragmatic
line over debt moratorium, nuclear-power generation policy

YOMIURI (Page 4) (Slightly abridged)
October 6, 2009

Various policy discrepancies are coming into the open in the
coalition camp. The Democratic Party of Japan (DPJ) is increasingly
irritated at its two ruling partners, the Social Democratic Party
(SDP) and the People's New Party (PNP), which are trying to
demonstrate their own policy imprint.

In a speech in Tokyo yesterday, PNP President Shizuka Kamei, state
minister for financial affairs and postal reform, emphasized the

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need to prepare a legal framework in the upcoming extraordinary Diet
session for implementing a moratorium on loan repayments for small
companies. He said: "I am determined to eagerly push ahead with this
plan. Even if financial institutions become financially strapped, we
should help them with the infusion of taxpayers' money. There are
cases in which they (small firms) find it difficult to repay loans
during the term of redemption. Small firms are in a very difficult

Kamei has long proposed introducing a debt-moratorium system. He is
steadily paving the way for introducing the system, as seen from the
fact that he met Regional Banks Association of Japan Chairman
Tadashi Ogawa ahead of the speech yesterday and asked him to
understand the need to introduce the moratorium system.

The SDP is also in high spirits. SDP President Mizuho Fukushima,
state minister for consumer affairs, food safety, declining
birthrate and gender equality, barked on Oct. 3 at Environment
Minister Sakihito Ozawa of the DPJ for his remark indicating a
willingness to make use of atomic power generation to reduce Japan's
greenhouse gas emissions. Fukushima assailed: "His argument is
apparently wrong. We must prevent a discussion on the idea of using
nuclear power generation to reduce CO2."

The SDP and the PNP have also made demands on the government's
policymaking framework. The government has now set up two
policymaking panels - the ministerial council on basic policies at
the party-head level set up by the three ruling parties with the
DPJ's concession, and the council on government agencies' policies
held by senior vice ministers to listen to views of ruling party
lawmakers. But the two parties have insisted that only two panels
are insufficient. In the first meeting of the three ruling parties'
secretaries general and Diet affairs committee chairmen today, the
two parties intend to urge DPJ Secretary General Ichiro Ozawa to
establish more forums for talks.

The DPJ is somewhat fed up with the two ruling partners' demanding
posture. Prime Minister Yukio Hatoyama takes a cautious view about
the loan moratorium system, saying: "We have not agreed to the
moratorium proposed." One DPJ member claimed: "Since we are no
longer opposition parties, we cannot take a policy contradictory to
the common knowledge among the people that 'you must return anything
you borrowed.'" Another member said: "We will make an enemy of the
banking world." Also on the SDP's reaction to the atomic energy
policy, a senior DPJ member grumbled: "Actually, it is impossible
for the ruling party to oppose the use of atomic power generation."

The DPJ is aiming to establish a system under which only the
government has authority to determine policies. Many party members
also have strongly reacted to the demand by the SDP and the PNP over
the policymaking framework. A DPJ member grumbled: "It might be
necessary to secure a majority in the Upper House, but I wonder how
long we are going to get along with the minority political parties.

16) Parliamentary defense secretary suggests continuation of
refueling mission by amending law

SANKEI (Page 3) (Abridged slightly)
October 6, 2009

Parliamentary Defense Secretary Akihisa Nagashima of the Democratic
Party of Japan (DPJ) delivered a speech in Tokyo's Tachikawa City

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last night. Referring to the fact that Foreign Minister Katsuya
Okada and others have indicated that (the DPJ administration) will
not "simply extend" the Maritime Self-Defense Force's refueling
mission in the Indian Ocean, which is to expire next January,
Nagashima said: "We want to (consider) options not tantamount to a
simple extension, such as requiring Diet approval. If the country is
allowed to continue the refueling mission by altering the framework
of the law, the mission should be continued."

Nagashima thus presented the view that (the government) should
decide in the extraordinary Diet session in the fall to continue the
refueling mission by adding prior Diet approval for (SDF) dispatch
to the Antiterrorism Special Measures Law. Nagashima also stressed
that Japan hopes to play an active role in providing civilian aid to

17-1) Defense Ministry discloses information on ASDF airlift
activities in Iraq

TOKYO SHIMBUN (Top play) (Abridged)
October 6, 2009

Based on the Information Disclosure Law, the Ministry of Defense
provided information on the weekly airlift activities of the Air
Self-Defense Force (ASDF) in Iraq to the requesters of this
information. This airlift mission, which started in July 2006 after
the Ground Self-Defense Force withdrew from Iraq, coincided with the
period U.S. soldiers were transported to Baghdad, an activity the
Nagoya High Court ruled to be unconstitutional last year. Under the
previous administration, entries during this period were blacked out
in the documents made public, but this time, all the information was
disclosed. The requesters viewed this as an "effect of the change in

The disclosed information on weekly airlift activities is for a
period of 124 weeks from July 2006 to December 2008, when the
airlift mission ended. Activities were recorded on 467 days, of
which 218 days or 47 percent were devoted to air transport to

A total of 26,384 persons were transported, of which 17,650 or 67
percent were U.S. soldiers. Adding to this the soldiers of other
countries, the proportion of military personnel transported came to
71 percent. On the other hand, only 2,564 UN officials were
transported, which made up only 10 percent.

The previous administration had explained that the ASDF was on a
humanitarian and reconstruction aid mission. However, it has been
confirmed that the number of soldiers, who were responsible for the
maintenance of security requiring the use of force, was
overwhelmingly larger than the number of UN officials in charge of
reconstruction aid. This constitutes logistical support for the U.S.

17-2) Defense Minister Kitazawa comments on disclosure of data on
ASDF airlift mission in Iraq

TOKYO SHIMBUN (Page 1) (Full)
October 6, 2009

Defense Minister Toshimi Kitazawa's comments: It is inappropriate
for the political authorities to impede the people's right to

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information. We are aware that this information contains certain
military secrets, but if the political authorities order the
bureaucrats to provide information to the people without fail, this
can be done. Concealment of information is not in the interest of
Japan or the ministries. Revealing the truth to the people is much
more beneficial for Japan's politics.

17-3) New administration's reassessment of ASDF airlift mission in
Iraq becomes essential after information disclosure

TOKYO SHIMBUN (Page 1) (Full)
October 6, 2009

Shigeru Handa, editorial staff member

With the change of government to an administration led by the
Democratic Party of Japan (DPJ), information on the weekly airlift
activities of the Air Self-Defense Force (ASDF) in Iraq has been
disclosed. The next challenge will be to reassess the deployment of
the SDF to Iraq, which the DPJ had opposed as an opposition party.
It will be interesting to see if the DPJ is able to demonstrate its
clear difference from the previous administration's "subservience to
the U.S."

In March 2003, then Prime Minister Junichiro Koizumi was quick to
announce his support for the war in Iraq led by the U.S. and the UK.
The U.S. then demanded "boots on the ground (the deployment of the
Ground Self-Defense Force (GSDF))," so the Japanese government
decided to send SDF troops.

After the withdrawal of the GSDF in July 2006, the ASDF expanded its
airlift operations to Baghdad and other areas, and there were
suspicions that these operations were serving the U.S. forces.

The DPJ's Kazuhiro Haraguchi (current minister of internal affairs
and communications) once questioned the government at the House of
Representatives special committee on Iraq in May 2007: "(This
document) is all blacked out. Will civilian control be possible with

The Social Democratic Party's Kiyomi Tsujimoto (current senior vice
minister of land, infrastructure, transport, and tourism) also
voiced her displeasure with the government's concealment of
information at the Lower House Security Committee in November 2006:
"If you are saying this is a humanitarian and reconstruction aid
mission, show us a document that is not blacked out."

With the above politicians now in power, data on the airlift mission
has been disclosed. On the other hand, the new administration has
not clarified its position on the justification for the Iraq war,
about which even the U.S. and the UK are now in doubt, and on the
merit of the SDF deployment.

When the Nagoya High Court ruled in April 2008 that the airlift
mission in Iraq was unconstitutional, the top SDF officer in charge
of the mission argued that, "This is an outrageous verdict. There
are also non-combat zones in Baghdad, and not all U.S. soldiers who
alighted from our planes went straight to combat duties."

The disclosed weekly information on airlift activities alone will
not be sufficient to judge if this argument was valid or not.
Fortunately, SDF documents that can be used for the assessment are

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now in the hands of the new administration. An examination of
security policy is indispensable for building an "equal Japan-U.S.
relationship," which is Prime Minister Yukio Hatoyama's goal.


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