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Is the extraction of surplus value sufficient for the necessity of revolution?

As I understand it, the extraction of surplus value is: the essential component of the "immiseration" of the proletariat, so it shows that the class has gradually lost more and more to the ruling class; and the basis of the "falling rate of profit", which shows that the ruling class gradually profit less as a function of their current power over the proletariat.

But prima facie, this, how surplus value keeps being made the same no matter how much has already been extracted, is more of a formula for the gradual irrelevance of class. So what other assumptions, perhaps historical rather than economic, are needed to convert this - which seems like stability - into political instability?

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    The extraction of surplus value is not sufficient for a falling rate of profit in Marx's view, the falling rate of profit also requires increasing "organic composition of capital", meaning increasing replacing of workers (variable capital) with machinery and other tools (fixed capital). If we imagine a world where technological progress has completely stagnated so the socially necessary labor time for different goods stays fixed, I don't think Marx would predict any tendency of the rate of profit to fall, so there'd be no progressive tendency for revolution to become more likely with time.
    – Hypnosifl
    Nov 15, 2021 at 16:40
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    Mass psychology has to catch up to economics: "For a revolution to take place, it is usually insufficient for “the lower classes not to want” to live in the old way; it is also necessary that “the upper classes should be unable” to rule in the old way", Lenin.
    – Conifold
    Nov 15, 2021 at 21:17
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    great quote, thanks. but can't the action of the lower classes bring the latter about? @Conifold
    – user56770
    Nov 15, 2021 at 21:56
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    Upper classes are typically capable of counteraction, and they have the propaganda and suppression apparatuses of the state to back it up. As Marx already emphasized, cultural and political superstructure is not a perfect mirror of the economic base, it has autonomous driving forces of its own: "it is always necessary to distinguish between the material transformation of the economic conditions of production... and... ideological forms in which men become conscious of this conflict and fight it out".
    – Conifold
    Nov 16, 2021 at 0:08
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    You may be interested in Marxist style analyses of the post-industrial situation. E.g. that capitalism managed to dissolve and co-opt proletariat, and a new lower class is needed as a vehicle of revolution (New Left ideology, see Baudrillard). Or that socialism generated a new upper class of statist bureaucracy paralleled by capitalist technocracy, inducing convergence of the two systems that both need to be upended (Đilas and Galbraith).
    – Conifold
    Nov 16, 2021 at 11:42

10 Answers 10

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The question deals with Marxism as an economic, social and political theory (surplus value, immiseration and political instability), rather than with its philosophical dimension, where it still may have some merits.

Indeed, from the theoretical viewpoint the ever rising living standards in the developed Capitalist countries (the opposite of the immiseration) have been the major failure of Marxism. Certainly, this failure is not as shocking as the mass murders committed by the Communist regimes, but it is also less likely to be dismissed as not true Capitalism by Marxism apologists. Moreover, the failure of the economic Marxism was quickly recognized by Many Marxists themselves.

I will address first the economic side of the argument and the comment on its political and social aspects.

Economics: Surplus value and immiseration
Labor is a commodity
The argument about the extraction of surplus value leading to immiseration as actually a caricature of the Lassalle's Iron law of wages. Lassalle understood that labor was a commodity, whose price was set by the market forces. The scarcity of labor led to the increase of wages, as the factory owners tried to attract workers, whereas the excess of labor led to lowering the wages. Lassalle correlated this with Malthusian cycles, claiming that high wages would result in higher birth rates, which, as the children grow up, would translate into the excessive supply of labor and hence to lowering of the wages, lowering of the birth rates, and so on. The amplitude of these cycles eventually stabilizes on the subsistence wage.

Lassale's view could be criticized for the Malthusian part - assuming that nothing but birth rates determines the supply of labor, that the demand in labor doe snot evolve over generations, and that the workers with a wage just above the subsistence level have nothing better but to make more kids.

However Marx rejects the other part of the argument - the role of market in determining the wages. For Marx wages are determined by the capitalist's will, while the quality of labor does not vary depending on the quality of life of workers - which depends on their wage, working hours, availability of vacation, etc.

Revisionism
That Marx' prediction of the impoverishing of the proletariat was not coming true became obvious rather quickly, before the turn of the century. This gave rise to the revisionist movement withing the German Social-Democratic party (which was the joint party of the Lassaleans and Marxists), led by the leading Marxist theoretician Eduard Bernstein. Bernstein pointed out that the wages were actually growing, and the Capitalist system was proving to be more adaptable and inclusive than Marx predicted. This eventually led to the split of the SPD into an essentially revisionist party that is today the major political party in Germany and fully abandoned Marxism, and the obscure Communist offshoots.

Great Depression and Keynsian policies
Another important development was the rise of the state intervention policies as a response to the Great Depression. The state intervention in this period is praised as the key to overcoming the Depression, and is just as often criticized for prolonging it up to the WW2. The side taken depends not only on being right-/left-wing, but also the context: the same policies that are praised in the context of the New Deal are condemned when discussing the Nazi Wirschaftswunder.

What is ironic about the Great Depression is that the problem was just the opposite of what Marx predicted: Unions and strikes prevented the businesses from lowering wages and hiring more labor, resulting in mass unemployment. The key economic policy adopted in response by the governments was stimulating inflation, thus lowering the real wages, while keeping the nominal wages in place or even growing. This policy continued to be used for several decades afterwards, in a hope to eradicate unemployment, eventually leading to the Stagflation in 1970 and the rise of monetarist economic policies.

Society and Politics: democratic engagement vs. revolution
The view on political instability runs in parallel to the economic theory developments outlined above:

  • Lassalle put emphasis on the universal suffrage and founded a the General German Workers Association with this aim. Despite his early death, the ideas were acknowledge by the pro-Marxist movements, which united with ADAV to form the already mentioned German Social-Democrat Party. Despite the new party trying to keep the balance between Lassalle and Marx (e.g., but picturing them as equals on the program poster), the unification incurred the vicious wrath of Marx in his Critique of the Gotha program, where he doubles down on the need for the violent revolution and the dictatorship of the proletariat, rather than peaceful parliamentary engagement.
  • Bernstein's recognition of the rising living standards, the parliamentary successes by the SPD, the growing power of the labor unions and their opposition even to a general strike were all reflected in the Revisionist debate. Bernstein explicitly states that the Socialism would come through peaceful transformation rather than a "violent overthrow of the existing economic and social order", as can be seen from his Evolutionary Socialism: A Criticism and Affirmation. His other text on the same subject has an even more provocative (to Marxists) title: Ferdinand Lassalle As a Social Reformer.
  • The argument that Capitalism is not causing lowering the living standards but rather equalizes society and transforms gradually to socialism was retaken from many non-Marxist quarters after the Great Depression. A signature work here is the Shumpeter's Capitalism, Socialism, and Democracy.
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  • Would you mind backing that up that Marx didn't recognize the market forces and placed it solely on the capitalist? From what I remember Marx didn't actually place a lot of blame on the capitalist but rather argued that they act according to their own best interest which could be read as egoism but also more likely as market forces. And the quality of labor correlating with the quality of life is what they all call "minimum wage" or "reproducing one's labor". Though the whole proletariat thing apparently was way shorter than anticipated.
    – haxor789
    Jul 17, 2023 at 14:44
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No, I agree. When the proletariat begins to extract excess value it is time for a revolution to throw down their leaders and restore freedom.

When armed mobs rove through the streets randomly descending on houses and taking all the art, furniture, etc., that's a time to have a revolution. When people are forcibly relocated to work farms due to ideology, that's a time for a revolution. When small quantities of poor quality steel are prioritized over farming to the extent that millions of people are thrown into starvation, that's a time for revolution.

You know, sometimes I'm tempted to think there is a reason that the 20th century saw at least 100 million people murdered by Marxism. But then such ideas are moderated away and I go back to my bovine complacency.

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    @ScottRowe Very good. You go get in line for the side of that you really believe in.
    – BillOnne
    Dec 11, 2022 at 16:46
  • "No, I agree. When the proletariat begins to extract excess value it is time for a revolution to throw down their leaders and restore freedom." Are you aware just how fascist that sounds? Like for real you want to murder people if they being to extract EXCESS value?
    – haxor789
    Dec 12, 2022 at 15:30
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    @haxor789 Restoring freedom is fascism to you?
    – BillOnne
    Dec 15, 2022 at 20:25
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    @haxor789 So forcing your neighbors to stop farming and make low quality steel to the extent that 100 million people starved, as happened in China during The Great Leap Forward, this is what? And a revolution against this is, in your mind, fascism. You keep using that word. I do not think it means what you think it means.
    – BillOnne
    Dec 16, 2022 at 15:36
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    @haxor789 So what, overthrowing the communists is fascism because there used to be an emperor who represented dictatorships, slavery, feudalism, colonialsm AND unregulated capitalism? You keep using a BUNCH of words that don't mean what you think they mean.
    – BillOnne
    Dec 16, 2022 at 16:06
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I was talking to a Marxist about this. There is the crisis of underproduction

eventually, the technological innovations look less attractive to investors who put money into gambling on the stock market... It becomes no longer profitable to invest in the 'real' economy

And the crisis of overproduction

Those who have developed this theory— Luxemburg is one of them— assume that the growth of the Organic Composition of Capital results in overproduction, because in their notion a disproportionate increase in constant over variable capital means that the production of commodities grows more quickly than people’s purchasing power.

https://imhojournal.org/articles/henryk-grossmann-vs-rosa-luxemburg-causes-meaning-economic-crises-not-just-history-karel-ludenhoff/


I cannot see how the capitalist can avoid both, unless they invest their capital in the forces of production (rather than finance), specifically variable capital/wages, which according to the claims of the falling rate of profit, doesn't happen: overproduction and/or underproduction is inevitable; unless the working class end up labouring to produce more commodities for the ruling class's consumption.

That could be why some Marxists warn of a gradual slip into further "barbarism" - ever increasing servitude.

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Everyone overthinks Marx on this particular point. It's easier to understand if we forget about class for a second and make it personal. Say you are employed by a guy named Joe, who owns a big machine that makes widgets. He needs you to run the machine because he has all sorts of 'front store' stuff to do: selling widgets, advertising, keeping books, etc. He doesn't need you particularly, because he has 300 other people who could do the job. Joe just likes you, so you got the job. Great! But then things start to happen:

  • He lowers your wages because there's a glut of widgets, and he needs to be more competitive.
  • He lowers your wages again because he needs to upgrade his equipment, and it costs a lot
  • He lowers your wages again because he needs to pay for his daughter's wedding or his son's tuition at some private school

Every time Joe and/or his widget company face a financial problem, he cuts your wages to help pay for it. And yes, he may cut his own income as well, but he will never lower his own standard of living more than he will lower yours (I mean, how many people are that generous or enlightened?). You could quit, sure, but then someone else would step into your job and you'd be in that mass of 300 people looking for a job like yours. And it wouldn't really help anyway, because everybody you might work for is just like your friend Joe. Better the devil you know than the devil you don't...

So here's the simple, psychological question: How low are you willing to let your wages go, and how frustrated are you willing to get in this job? Sooner or later you're going to have to tell Joe that you're not making enough to feed and house your family, while he's throwing lavish parties and sending his kids to the best schools. But that's a risk: do you think he'll see the light give you a raise, or just fire you and hire someone who works more cheaply and complains less?

Marx's thought is that if a whole lot of people are in your position, and a whole lot of people like Joe are running the show, then you end up with two classes of people, one of which is wealthy and indifferent, and the other which is impoverished and frustrated. And an entire class of frustrated people — if they recognize themselves as a class, with a common source for their frustration — are prone to angry outbursts. That could be a violent revolution or a peaceful political revolution, depending, but (within a Liberal system, where the idea of individual rights and individual advancement is prevalent) people are disinclined to stew in their own juices.

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    Increasing exploitation isn't necessarily about decreasing wages, it's possible for in Marx's terms for exploitation to increase while wages stay constant or even increase. Also Marx wasn't just arguing that class conflict meant workers are generally prone to angry outbursts from time to time, he saw the theorized tendency of the rate of profit to fall as central to his argument as to why some kind of revolutionary overturning of the capitalist system was basically inevitable given enough time.
    – Hypnosifl
    Nov 15, 2021 at 18:10
  • @Hypnosifl: Yeah, I know, I just wanted to simplify things to get it out of that 'heady' space of class conflict. Exploitation boils down to owners guaranteeing their own standard of living at the expense of employees' standard of living. It's employers competing with other employers (socially and commercially), with employees caught in the crossfire. Nov 15, 2021 at 18:17
  • I found this explanation helpful. I never really studied this stuff, because I went to college, and succeeded in getting something above a wage job. So, who really cares, right? My useless advice was always: go to college and get a better job. But that is not working as well as it used to.
    – Scott Rowe
    Dec 11, 2022 at 16:46
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    @ScottRowe: The (Marxist) point is that if we don't own the means of production that provides us with income, then the people who do own that MoP will always satisfy their own needs and desires first, and pay us from what's left over. In good times with good owners that might work out fine. In hard times, or with amoral owners, we should all expect to get the shaft. We have no defense against getting the shaft except for the moral character of those in the owner-class. Dec 11, 2022 at 18:50
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    @ScottRowe: That's why Elon Musk wants to force Twitter employees to work from the office: control over the means of production. People who work from home have too much control over how they use their time. Dec 11, 2022 at 18:53
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As wages decrease relative to profit, and the rate of profit falls, then, relative to the amount of capital, the working class can buy less commodities


Immiseration is Marx's prediction that

profits would increase faster than wages

The falling rate of profit that

—the ratio of the profit to the amount of invested capital—decreases over time


These two claims together mean that wage (not just variable capital, which I think is about 'value' and has its relative reduction more trivially derived from Marx) falls relative to capitalist investment (as, presumably, a greater proportion of capitalist wealth is spent on the means of production).

As production needs to be realised in consumption, and there is a "limited expansive capacity of social consumption" (Capital volume 3), then less money on wages equates to the working class buying less commodities, and then if due to competition the capitalist class do not (see Luxemburg)

  • commodity production, M-C-M, stalls and less money is made.
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    I'm a bit confused about this. Really, I should join a good reading group, rather than ask here
    – user62133
    Aug 12, 2022 at 23:17
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First of all these "classes" shouldn't really be seen as fixed groups, but rather as descriptions of the economic means by which people make a living. So do they use capital to make other people provide for them and generate them profit or are they selling themselves to someone else to work for a living.

So these classes don't have to share a group identity and the wealth level is only partially reflecting the class. Just because Marx argued that the "working class" should develop a "class consciousness" and unite rather than let them selfselves be pitted against each other doesn't mean that there are these fixed bubbles of the "working class" and the "ruling class" or that people are aware (conscious) of their status. Like how it's fairly common for people to self-identify as middle class (upper-lower-left-right-bottom-top ...-middle class) to avoid a calling oneself poor or rich, which might come with stigmatizing stereotypes. Which on the other hand means that they still reproduce these stereotypes and for example look down upon people who are in a similar situation as themselves rather than join forces and make it better.

So an antagonism against "the ruling class" will do nothing to change this situation unless it also changes the material conditions and the way things are organized. Otherwise there will be a new capitalist class and a new working class but the concept of classes wouldn't change.

Now in terms of extraction of surplus. Well think of it that way. Suppose you are a producer of product A. In order to produce A you need to train 3 years and then invest 20h of work to make a specific product of A. There's always some variation like some will take 4 years others 2, some will make it in 18 hours some in 22. But it's feasible to on average eyeball the stats and nail it down to 3 years for education and 20 hours for production.

Now let's say you want to supply 10000 customers that need the product once a day. So with an 10h workday that means you need 20,000 people working on that task and probably a few more to allow for weekends.

Now suppose someone invents the steam engine. It's prohibitively expensive and so few people can afford one but you're lucky enough to have that capital to invest. With that new steam engine you set up a device that yields 1000 units per hour. So that you can supply the whole demand (with some surplus if it runs around the clock) and it only requires 100 people who are trained a week to operate the machine.

So previously the price of the product reflected the cost of purchasing the raw material, the labor cost and the profit. Where the labor cost is at least the "cost of living" of the laborer. Like they are occupied most of their waking day occupied doing work so they need, food, shelter, recreation and so on to not just die, plus they might need to pay back loan for the time when they were trained and didn't receive money or when the employer paid them despite no output due to training and so on. And profit is what remains after you've substracted the cost of raw material and the cost of living.

Now to extract that is essentially stealing from the employee who's labor created that value. Now suppose the raw material is $500,000 the labor cost is idk $20x10 hours x 20,000 people = $4,000,000. Suppose you sell it for $500 a piece you'd make $500,000 in profit which if you keep it is 2500 times what the average worker is making. Meaning if you run this business as-is you'd already create a growing social inequality by the day.

With roughly stable prices that would mean that you could buy 2500 times what the average worker is able to buy, meaning you could easily create shortages or run operations where you employ the working time of 2500 people. That's already some serious power you could wield.

However suppose those numbers aren't of one factory but those were all independent workers doing their work at home and keeping the $50 profit for themselves. It's steadily growing but not merely as fast and would not yield that much of a social power. However the manufacturer with the 10,000 products already has a more stable and streamlined production with a more stable quality and shorter production times and more items in stock so they might already put people out of work and make the sacrifice their profit in favor of at least netting their standard of living.

Now suppose someone invents the steam engine and because you've got the capital in stock due to exploiting 10000 people (stealing their profit) and others don't you invest that capital. Now you can produce 1000 units per hour, meaning you can saturate the demand and more and you're only need 2 shifts of 50 people to run the plant around the clock and they only need a week of training to operate the machine.

While the employer might pay them $10 each (lower skilled work) reducing the production cost to $500,000 +$10000 labor cost + $10,000 for idk coal for the steam engine reducing the production cost to $520,000 while probably selling at the same price of the competition. Making a profit of $4,480,000 or ~45,000 times of the average worker. Sure over time the that profit will decrease, more people will be attracted by those profit margins and invest in steam engines likely reducing the price from $500 to $60. But in the meantime a lot of capital or social power has changed it's owners. That is what previously fed 20,000 people has now made 1 person filthy rich.

Whereas the remaining 100 workers have only half of what they used to need for their standard of living and the 19900 don't have any income and have their hard acquired skill set be worth nothing.

So without work, without savings (minimum wage) and without a paying education (the one they had is useless) they need work, fast, unskilled and even low paid as they need something to pay the bills. Meaning it further drops the price of labor and contributes to immiseration.

Now that doesn't mean that technology is bad, far from it, but it exaggerates an already existing tendency for inequality in the mode of production. And even if over time profits are falling the wages will no longer increase on their own.

So the economic situation is anything but stable, but worsening and the social inequality resulting from that was explosive. Which is why even conservative politicians at the time at least introduced stuff like social security to provide a rock bottom instead of a bottomless pit. While Marx was rather in favor of simple making that technology common property so that everyone contributes and shares the benefit of that increase in production not just a selected few.

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I finally got this, I think.

Profit is epxloitative, but nevertheless just, not an injustice. When the rate of profit falls, unless the bourgeoisie become less dominant and exploitative, which can only - we might state - be due to working class gains, then there is less justice to that, and the working class suffer injustice as social crisis, wars, ever more depraved forms of loss.

I think Marx did not consider profit injustice, and was careful not to, and perhaps not due to contempt for moralism, but actually something more like what's wrong.

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Whether there is a temporary crisis of underproduction, due to recovering profits by investment in financial markets at the expense of things, an overproduction, due to the increasing organic composition of capital meaning labour lacks the means to buy what they labour to create, these are responses to the falling rate of profit, lower capital investment in variable capital, wages, the only basis of value and profit.


Furthermore, when the counter tendencies to the falling rate of profit (increased exploitation, new international markets, etc.) no longer function, the crisis of capitalism (given there is no revolution nor capitalist collapse), aside from the drive to war, means...

The only means left for the continued existence of capitalism... permanent, absolute and general pauperisation of the proletariat

Mattick, ‘The Permanent Crisis’

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It is not necessary as it derives an "ought" from "is".

  • Profit is extracted from X
  • X is miserable
  • Revolution is necessary

That revolution is necessary is neither self-evident analytically (necessarily true), nor does it follow from premises.

For it to be necessary you need to introduce a supporting "axiom" that 'egalitarianism is Good' in order to substantiate this. However, you then fall onto the open-question argument.

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  • man, not every ethical question is prohibited. this is one answer, one which does not engage with the history of marxism
    – user56770
    Nov 15, 2021 at 17:22
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    It may mean "logically necessary." It may be that revolution is necessary in the sense that it is necessary that A=C if A=B and B=C. (Marx is inconsistent on whether it's determined or morally required.)
    – Mary
    Aug 13, 2022 at 0:09
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Given that the working class revolution may fail to come, it seems fair to assume that there is no one historical event or state of affairs that can be added to Marx's economic analysis to show that the working classes are revolutionary.

Indeed, it may be better to think of the revolutionary potential of the working class as an axiom or assumption of Marxism, discovered in historical analysis of past class based societies, and the existence of surplus value as showing that it is necessary (ethically; or at least for the working class) while still possible.

The falling rate of profit would then amount to the fetter on capitalist power which shows that, unless technological advance ends, capitalists are losing power interior to the capitalist system - the more capital that is generated by them the less use their capital is at that - so that there are social crises, and, via e.g. the crisis of over accumulation (in which M-C-M stalls and capitalists lose money), economic ones. Perhaps, then, instead of making revolution more likely, the falling rate of profit, at least without reforms that grant the proletariat more of a say, makes commodities become more fetishistic because capitalists lose control relative to their wealth; the social relation becomes ever more thing like, automatic and mysterious, making Marxism more relevant for the furthering of human ambition.

tl;dr

You need to study (living) history, and it may not happen.

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  • my theory is that marxist economics shows less that revolution is inevitable for the system (only the class as a historical entity), than that capital will become more volatile. invest in bitcoin! lol
    – user56770
    Nov 15, 2021 at 21:01
  • not sure why this was downvoted. i suspect it's because it was misread
    – user63756
    Dec 11, 2022 at 5:37
  • i suppose the falling rate of profit might be sufficient for the possibility of revolution, but i doubt it, and i doubt that it can be shown without "historical materialism". i mean, what do i know, but then most people use this site to answer questions they are not very well read on, so it's kinda funny to downvote for that reason.
    – user63756
    Dec 11, 2022 at 5:47

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