Int’l. Journal of Political Economy, vol. 31, no. 1, Spring 2001, pp. 45–56. © 2003 M.E. Sharpe, Inc. All rights reserved. ISSN 0891–1916 / 2003 $9.50 + 0.00.

CLAUDIO KATZ

The Economic Crisis Interpretations and Proposals Why is the Argentine economic crisis so serious? How can the current, continuing depression be explained? The recession has lasted for three years, twice the usual duration of cyclical contractions; the fall in investment has reached every sector and gross domestic product has shrunk 4.3 percent since the beginning of 1998. Interest rates five times higher than the international average stifle each sign of recovery, and consumption has collapsed with the drastic contraction of purchasing power. Poverty afflicts 37 percent of the population, unemployment is at 30 percent, and half of salaried workers earn less than 500 pesos a month. In the entire history of the nation, there is no antecedent for a social disaster of this magnitude. The critical point of this crisis is the virtual cessation of foreign debt payments that Argentina has faced for a year. The impossibility of complying with the due dates of the debt payments crushed Machinea’s protective shell and threatens the continuity of all of Minister Domingo Cavallo’s measures. Many creditors have assumed that, sooner or later, the Argentine government will have to declare insolvency and resort to a forced moratorium. They know that the International Monetary Fund’s (IMF) refinancing agreements are not realistic and that, therefore, the country’s risk rating is stuck at an exorbitantly high level. Cavallo expected to gain a respite by postponing debt payments through

English translation © 2003 M.E. Sharpe, Inc., from the Spanish original: Claudio Katz, “Crisis: Interpretaciones y propuestas,” Revista da Sociedade de Economia Politica (July 2001). Claudio Katz, an economist and professor at the University of Buenos Aires, has published a number of papers in Latin American journals and media on the Argentinian economy and the recent crises. Translated by Chase Madar. 45

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the mass exchange of old paper for new bonds with a prolonged maturation date. But as the American treasury and the European central bank have both declined to guarantee these issues, the cost of the operation has been scandalous. Payment obligations have risen to $47.4 billion and, when the twoto-three-year grace period ends, the impossibility looms of meeting payment deadlines. And long before this date, the creditors will demand privileges that supersede the needs of retirees and public employees. As the mass exchange of bonds also failed to clear the way for recovery, Cavallo is now betting on exports, and has therefore opened the dikes for a devaluation with the reintroduction of the currency market split between commercial and financial sectors. Although he affirms that convertibility will be held firm during this first attempt at half-euro, half-dollar parity, he will have no problem justifying a devaluation if the recession doesn’t last. While the gross domestic product (GDP) continues to shrink, any of his measures might lead to a major crisis, which would include the massive abandonment of public securities, deposits in pesos and paper in Argentine firms. If these panics occur, there will be an even more radical turn toward maxidevaluation, dollarization, or both. The current situation recalls the circumstances of large-scale collapse in recent decades (e.g., the Rodrigazo of 1975, the state appropriation of the debt at the beginning of the 1980s, the hyperinflation of 1989) and the conjunctural explanations—which attribute the crisis to “Carlos Menem’s corruption” or “Fernando de la Rúa’s ineffectiveness”—become very unconvincing. Changing neoliberal justifications Until last year neoliberals reduced the crisis to an unfortunate coincidence of external difficulties (e.g., appreciation of the dollar, devaluation of the real, a fall in the prices of our exports, the fall in the euro, collapse of other peripheral economies). But this type of adversity has been frequent enough in the past. The only thing new is the singular defenselessness to these contingencies as a consequence of financial liberalization, industrial privatization, the fall of trade barriers, and the abdication from monetary and exchange policy sovereignty. But because recognizing this situation would be an admission of failure, orthodox economists resort to a fall-back explanation: high public spending. They argue that “only the private sector has made the necessary adjustments,” as if businessmen and the workers formed a united collectivity that shared the sacrifices. In their crusade against the deficit, they hide the fact that this imbalance does not come from social spending, or education, or government workers’ salaries, but rather from multiple mechanisms of direct and indirect subsidies to the ruling class.

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And the neoliberals especially omit the principal source of the collapse of public finances: the interest payments on the debt. These disbursements are triple the expenditures on administration, six times greater than social assistance and twenty-three times the resources spent on employment plans. Public spending automatically multiplies with each refinancing of the debt, and there is no way to eliminate the imbalance with new privatizations. An auction on all existing public property—including the houses of Congress— could reduce the $6 billion per year that goes to the salaries of personnel, but it would not attenuate the $11.4 billion that debt interests absorb. Just look at the recent commissions paid by the mass bond exchange, in order to note which are the permanent mechanisms for expanding the deficit. But this evidence is invisible to the experts, who rant and rave about “waste in the provinces” and “inefficiency in the health and education systems.” The neoliberals also forget that the fiscal shortfall really got out of control with the elimination of employers’ contributions to the social security system. This “hiring incentive” helped generate the current record unemployment levels, and provoked a loss of fiscal revue equivalent to a third of the public debt. After accumulating a bounteous mass of money, the private pension plans (AFJPs) have become large creditors to an insolvent state, while keeping current retirees in misery and threatening to inflict a worse situation on the next generation of retirees. Faced with this outlook, and in order to protect the private pension funds, the government plans to raise the retirement age and lower the minimum wage. It is evident that bringing back the employer contributions to social security, and getting rid of the parasitic system of AFJPs, could begin to remedy the fiscal imbalance that the neoliberals so question. But as this corrective measure would affect the establishment’s profits, orthodox economists don’t even consider it as an alternative. Under the impact of the Aerolíneas bust, some neoliberals have started to accept that “poorly done privatizations” have contributed to the current crisis. But what happened with the airline is a typical case of fraudulent assetstripping, which cannot be described in terms of a correct or incorrect sell-off of a public good. Of the remaining privatizations, which ones were done correctly? The subsidized rail system and toll roads? The sale of telecom companies at risible prices? The sale of energy companies with debts swallowed by the government? The granting of monopoly licenses to electric companies? It is evident in all of these cases that the state, far from “disengaging from the economy,” solidified its role as a subsidizer, guaranteeing (in a time of deflation) rate hikes of between 40 and 100 percent. If the privatized enterprises had had to meet the same external competition that rules the rest of the economy, they would have ended the same way as

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Aerolíneas. But in spite of this evidence, those economists with a television audience keep talking about “faulty privatizations” (e.g., Banco de la Nación, provincial businesses, the lottery) and of the “coming reforms” in health and education, as if this type of transformation had some beneficial effect for the bulk of the population. Their arguments worn out, the neoliberals resort to beliefs. “Dollarization,” they promise, “will complete the reforms” by restoring confidence in the currency and ensuring an influx of foreign capital. But they avoid commenting on the U.S. Federal Reserve’s lack of interest in rescuing foreign banks, businesses, or currencies; they also fail to examine the effect of dollarization in countries like Panama, which is going through the same kind of crisis as other Latin American countries. The new monetary regime will only facilitate property transfers, favorable to groups that have liquid capital, by means of a deep deflationary adjustment. The neoliberal discourse combines amnesia with schizophrenia. It ponders the “transformation of 1991–95” as if the changes involved were unrelated to the previous disaster, and they absolve its makers of any responsibility for the current pauperization. On other occasions they attribute the crisis to technological and scientific backwardness, forgetting their militant support for cutting public funding to the university and to the closing of CONICET.1 Neoliberal policy has been instrumentalized, until now, through three justifying mechanisms. The first was José Luis Machinea’s attitude of resignation, which reduced public salaries and raised taxes on the middle class, declaring that “nothing else could be done.” Then came the explicit aggression of Lopez Murphy who tried to increase the scale of the outrage, presenting the shocks already suffered as examples of gradualism. And finally came the pragmatism of Cavallo, who denounces at night what he’s going to do the next morning, accumulating a record of initiatives that are abandoned even before they are announced. He talks about giving priority to recovery through increased tariffs, reductions of currency reserves and sectoral subsidies—but then turns toward fiscal toughness, the generalization of the value added tax, and doubling the tax revenue goals of his predecessor. He questions the state’s ruinous debt, but issues treasury bonds that ensure high rates and tax privileges to the banks. He speaks of a blanqueo, which he immediately leaves in the lurch; and as he proposes distancing the peso from the dollar to bring it closer to the euro, he suggests the contradictory measure of leaving Mercosur in order to enter the North American Free Trade Agreement (NAFTA) unilaterally.2 On top of that, he promises to maintain convertibility, while firing the first shot in a war of competitive devaluations throughout South America. In the past, the super-minister demonstrated his inclination to contradict,

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in practice the theories he has defended from the start—given that in the 1990s, before overvaluing the peso, he proposed an export-based economy. But Carlos Rodríguez and Roque Fernández were also champions of fiscal austerity until they managed the public purse, and Machinea was a man from industry until his ministerial position turned him into an agent of the banks. All the functionaries who become heads of the Palacio de Hacienda distance themselves from the lobby that brought them to power, in order to balance the interests at play among the distinct business groups. But this decision making has become very difficult, and it is for this reason that Cavallo adopts such improvised and mutating measures. There is no more distribution of profits, like ten years ago, but rather a division of losses among the principal capitalist factions: the industrial export sector, and the nucleus of bankers and privatized businesses. Cavallo has, until now, juggled these interests well enough to please both groups. He favored the first clique by incorporating people from the Argentinian Industrialist Union (UIA) in his management team, pushing Pou out of the Banco Central, lowering taxes with “competitiveness plans,” and granting a preferential dollar exchange rate to exporters. He assured the second sector that his monetary policy would continue, along with the lucrative debt management that guarantees the dollarized contracts of the privatized industries. But this equilibrium can also founder if the recession goes on. Criticism of the neoliberal model The majority of the economists who oppose the current policy focus their attention on the “neoliberal model,” but present extremely varied characterizations of this scheme. In the most up-to-date vision, this orientation is identified with convertibility. Some of them claim that one-to-one parity was always inadequate, while others see it as successful in overcoming hyperinflation, but inopportune after the currency stabilized. Both outlooks propose devaluing, directly or selectively (sanctioning, for example, punishing the banks, but not the bank account holders). But convertibility is more than an “inadequate policy”—it is an instrument of monetary discipline aimed at guaranteeing the payment of the foreign debt. It is a limiting mechanism on the money supply to guarantee repayment to creditors. This goal was shaken by the same imbalances that were generated by one-to-one parity, when it accentuated the lack of export competitiveness, aggravating the fiscal shortfall and substituting the old emission of debt paper by runaway debt. But to analyze these contradictions, while omitting the principal function of this exchange regime, is to miss the forest for the trees.

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Convertibility constitutes only a different form of subordination of economic policy to creditors versus the traditional floating of exchange rates. In both modalities, monetary sovereignty is set aside under the pressure of the banks, who directly impose recessionary adjustments in the first case, and devaluationary shocks in the second case. Both systems create temporary mirages. Convertibility generates the impression of a sudden monetary solidity, and the devaluations seem to indicate that the dependent nations are managing their export policies. But these illusions evaporate in the crisis, when it becomes clear that the productivity gap separating Argentina from Germany does not go away with the common hierarchy of monetary stability, nor does the chasm between Brazil and Japan close because both give priority to trade surpluses. To suppose that the crisis can be resolved by abandoning convertibility is as illusory as imagining the viability of some mechanism of “popular devaluation,” which might avoid a depreciation in wages or an expropriation of people’s savings. Bearing in mind the debt payment schedule and the IMF’s controlling reins on the economy, any devaluation would have an impoverishing effect. Many who challenge the current policy remark on the recessionary consequences of convertibility, and especially the permanence of high interest rates from “the lack of active policies.” But this absence does not derive exclusively from the fixed exchange rate. What’s preventing all the nations of the global periphery from applying Keynesian reactivation policies is their dependency on the audits of the IMF, which restrict domestic lending for investment and consumption in order to ensure payment of the debt. Although the magnitude of this liability is not proportionally superior to that of core countries, it is denominated in foreign currency and depends on its periodic refinancing. The economic cycle of these countries is therefore more subject to the monitoring of the creditors (and to the consequent entry and exit of capital) than to the internal forces of demand. This conditioning factor explains why the new elite of the financial organizations has assumed the direct macroeconomic management of the indebted nations, replacing the old national bureaucracies. It is very frequently heard that the weight of the debt has consolidated the “supremacy of parasitical financiers over productive industry.” The privileges of the bankers, profiting from the high reserves and financial transactions, are contrasted with the misfortunes of the businessmen overwhelmed by the total absence of credit. But this dividing line forgets the enormous ties between these groups and the financial diversification of the large firms, which also manage an important portion of public bonds. The industrialists participated in the great fiesta of privatizations and are the ones who have

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most benefited from the productivity increase borne by the workers during the first half of the past decade. The victims of the model have been wage earners whose remuneration fell 0.5 percent with each percentage point of increase in the GDP, and not the capitalists who profited from the precariousness of employment that ruled throughout the 1990s. In addition to the other problems of the dispossessed, we have now the drama of “exclusion,” or expulsion from the labor market. This marginalization is the result of the vicious circle of adjustments that generate more unemployment and less purchasing power, in an economy that has 80 percent of its product centered in the internal market. But unemployment grew together with the exploitation that benefited capitalists, and which the ruling class touts as a strategic goal. For this reason, Cavallo started out by obtaining special powers from Congress to accelerate labor “reform” that repealed special statutes, and eliminated indemnifications and overtime. As used in the service of this exploitive aim, the “trade opening,” and far from affecting all players, allowed the large conglomerates to lower their wages, while simultaneously destroying their competitors among small- and mid-size firms. It is therefore clear that neoliberal policy enabled the Argentine economic crisis through convertibility, monetary adjustment, social exclusion, and trade policy. But this model is not the cause of a depression that affects the entire periphery, and which has its roots in the global dynamic of capitalism. General collapse of dependent countries The Argentine crisis constitutes just one of the upheavals shaking the “emerging markets” (e.g., Mexico in 1995, Southeast Asia in 1997, Russia in 1998, Brazil in 1999, Ecuador in 2000). This escalation has developed as a “domino effect” affecting the dependent economies indiscriminately, whatever its root cause in monetary or fiscal policy. In all of these cases, a fall in the prices of exported commodities coupled with capital flight have had devastating social effects. Although the existence of a common neoliberal policy could be identified in all the affected countries, the modalities of this orientation are diverse, while the dependent capitalist aspect is common to all these nations. In these countries, the consequences of global polarization of income between advanced and backward countries, which prompted the capitalist reorganization of the 1990s, can be readily observed. Peripheral countries have been particularly vulnerable to the generalized offensive of management against labor, to the geographical and sectoral expansion of capital, and to the competitive fury that has accompanied the internationalization of the economy. It is thought that the gap between developed and undeveloped nations

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grew thirty to sixty times in the last three decades, reinforcing the concentration of 86 percent of total consumption among 20 percent of the world’s people. The dependent nations have endured a systemic and growing transfer of resources to the large corporations of the developed world via unequal exchange in commerce, payment of the foreign debt, and the transfer of profits earned from paying low salaries in the internationally integrated sector of the periphery’s industry. Technological backwardness, financial fragility, industrial duality, and the commercial disadvantages prevalent in these economies have intensified palpably in the last few years, provoking the current string of acute crises. The Argentine debacle is for this reason similar to the crises suffered by the bulk of Latin American, Asian, African, and East European nations. The political correlate of this decline has been a process of “recolonization”—that is, the local ruling class’s loss of autonomy as a consequence of its growing entanglement with foreign capital. The bureaucrats of the IMF have thereby attained unprecedented powers. This new situation can be summed up by an old term: “aggravation of imperialist oppression.” Like that of other dependent nations, the Argentine economy bears with heightened intensity the consequences of overproduction, absorbs the impact of the sectoral fall in the rate of profit in the core economies—as much in the phases of full decline, as in the stages of partial recovery—and suffers from the lack of purchasing power among the majority of the population. These imbalances give rise to speculative operations associated with indebtedness. But to label these actions as merely “immoral acts of finance capital” obscures the systematic transfer of value, in the background, to imperialist corporations. If the same financial parasitism has had such different effects in the United States or in Great Britain, in comparison to any peripheral country, it is because of this process of imperialist polarization. The Argentine economy has participated in the general decline of Latin America in the world market, as signaled by the low growth rate that has predominated since the “lost” decade of the 1980s. Like the rest of the region, it has contributed to the “hegemomic recovery” of the United States—financing the reorganization of U.S. banks affected by the regional debt, opening new markets for the export of the principal, and facilitating the remission of profits of corporations based in the region. Argentina’s ruling class made this revenue transfer possible, in spite of its harsh effect on the internal market, but ultimately failed to create a semi-autonomous business pole around Mercosur. The ruling class now seems to be veering toward incorporation into the Free Trade Area of the Americas (FTAA), which the United States promotes as a way of displacing its European competitors in South America. The Argentine crisis is part of a capitalist reorganization that does not

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favor underdeveloped nations. But it is particularly acute because it converges with a long-term economic contraction, which has eroded Argentina’s traditional perch in the upper tier of the periphery. Per capita GDP today barely exceeds 1974 levels, and the important GDP growth of 127 percent between 1949 and 1974 contrasts with the languid advance of 55 percent from that date to the present. Unlike South Korea, the Argentine economy hasn’t collapsed from competition with the big corporations, but rather from continually slipping down rungs of the global market. Just as in the new nations of the periphery, which like Russia are beset by the capitalist restoration, Argentina is undergoing a systematic destruction of its past economic gains. It is even confronting, for the first time, situations of extreme poverty typical of the outer periphery. But this kind of decline is nothing new under capitalism, which is a system structured around profit and the consequent migration of capital toward areas that promise greater gains. The “stable architecture” that separates the imperialist nations from those on the periphery is ruled by the “variable geometry” of underdevelopment, which generates dislocations, rises, and delays in the interior map of the peripheral nations. The “mafia state” and the “idiosyncrasy of a rich country” The gravity of the Argentine economic crisis has led many analysts to discover its causes in the world of politics. Some intellectuals argue that the decline in productivity is a result of the “institutional instability” created by the consolidation of a “mafia state.” Others blame these same difficulties on the “legacy of militarism,” the “lack of the rule of law,” or the “break with the constitutional order of 1930.” But—although the accelerated erosion of the political regime is plain enough under the impact of bribes, money laundering, and narco-traffic— these destructive forces are really a result of the continuing economic debacle, which systematically destroys the rules of the game and breaks down the authority of the ruling class’s political parties. Moreover, the belief that corruption is somehow antithetical to capitalist growth is inspired by the same idealized vision of this system, which in reality is always mixing the legal with the illegal in the business sphere. It is enough to observe the influence of the “economy of crime” in the U.S. financial system, or the incidence of shady investment deals in the newly industrialized nations, to verify this fact. It is an untenable fantasy to claim that the IMF or the World Bank really rewards transparency. Weren’t IBM, Siemens, Telefónica, and Iberia the ones engaged in fraudulent contracts with the state? Didn’t the embassies of the United States and the European countries

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act as direct bases of these operations? Corruption feeds on the same search for higher profit that dominates all capitalist activities, and is affected by the same competitive blindness that shakes up these processes. In certain cases, it accelerates the accumulation of capital; in others, it prolongs the crisis. Another current way to understand the crisis is by tracing its cultural roots, and recycling all the old stereotypes about the “Argentine character.” In these visions, the “absence of a national project” is invariably pointed out, and the “native cunning,” “lack of a work ethic,” “hubris at believing ourselves to be chosen,” and the “idiosyncrasy of a rich country that looks down on hard work” are all condemned. But in these phrases it is supposed that each citizen—symbolizing an ideal social type—has the same responsibility as the powerful ones who are responsible for the current depression. It ignores the fact that the ruling classes define and enact economic policy, and that it is therefore incorrect to project its failure onto the whole of the population. It is certain that the economic decline of a nation with as much natural wealth as Argentina has historical roots. But these roots have nothing to do with the temperament of its inhabitants, but rather with an agricultural-financial configuration of the social structure during the nineteenth century, as well as the subsequent distortions in the late and dependent process of import substitution, and the systematic exit of resources toward the exterior. This same situation prevails in many underdeveloped nations, which equally lack a “risk-taking and innovative business class.” But the most important thing is not to understand this reality, nor to accept it fatalistically, but rather to conclude that nothing can be expected from the groups that have traditionally managed power. The future of the country depends on the action of the working-class sectors, which in full-out social regression have been able to maintain their old traditions of struggle and to incorporate new forms of resistance. Active workers and the unemployed constitute a social force capable of building an alternative to overcome the current crisis. Three proposals for change and another perspective No tangible improvement in the Argentine economy will be possible without restoring the standard of living to its level in the 1970s and 1980s. This is the conclusion that is scorned by all the neoliberal economists who recommend that the adjustments continue, and by all the anti-liberal economists who see solutions in exchange rates, competitiveness, and trade barriers. Guaranteeing a minimum income for all the unemployed, and increasing wages and pensions to recreate purchasing power, are the basic conditions for any pro-

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gressive alternative to the current course. “Consumer confidence” is recovered through labor-law reform and ensuring stable employment, not through the “trickle-down” of profits obtained by businessmen. The uselessness of waiting for earnings that can generate employment, which will allow the expansion of consumption, is by now proven. But Cavallo persists in this line: by imposing a tax on current accounts that will be borne by small business, rather than banks; by reducing taxes on the upper middle class by a sum equivalent to 193,000 employment plans; by modifying tax law to authorize deferred payments for big business, while maintaining their current regressive percentage of the IVA. An immediate and substantial improvement in the standard of living for wage-earners and the unemployed is indispensable to close the revenue gap that separates the richest and the poorest deciles, a gap that has grown by 57 percent in the last ten years. Are there not enough resources to effect this change? If we look at the balance sheets of the model’s winners, we rapidly discover who has taken the earnings amputated from the workers. In the midst of national misery, four Argentinians made the list of the world’s 538 richest people—Perez Companc, Rocca, Noble, and Fortabat. Since then, many trade unionists and popular leaders have demonstrated ad nauseum that getting rid of the $20 billion in annual tax evasion by the big conglomerates, and redistributing that sum, would immediately raise the amount needed for emergency employment plans and family sustenance programs. But an economic reconstruction plan cannot advance in perspective without eliminating the pillage of privatizations by means of a recovery of the state command of strategic enterprises. Obviously, this cure would be worse than the disease if the costs of this transformation fell to the contributors, and not to the beneficiaries of the privatization fraud. To rebuild the common property in the principal companies under popular control, and by means of democratic management, is not only necessary to block the liquidation of Aerolíneas, but also to put an end to the despotism of exorbitant rate-setting. It will be said that these measures “violate contracts.” But weren’t all the laws protecting labor rights, social rights, and retirement rights violated in the past decade? The only difference would be in the fact that, for the first time, the same “juridical insecurity” would befall those who got rich manipulating the law for their own benefit. Certainly this decision would provoke financial retaliation; but it must be remembered that electrical plants, oilfields, and telecom networks are not profits that can be transferred abroad. At any rate, the most critical side of the Argentine economy is the debt. As long as the creditors’ daily pressure on the public finances lasts, there will be no incentive to adopt a single measure favorable to public well-being. It is

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therefore best to declare a suspension of debt payments, rather than passively confront the similar situation of a moratorium. This declaration would be a sovereign decision that would allow a reorientation of resources toward the priorities of social spending and industrial renewal. It is usually affirmed that this measure would marginalize the country in the international markets. But hasn’t this already happened, as a result of trying another impossible arrangement? “Capital flight” is also warned against, forgetting that all the promises to honor the debt didn’t bring about the return of a single cent from the $100 billion deposited abroad. It is important to keep in mind that in international relations there is no respect for “debtors who are doing their homework,” but rather governments who take ridiculous pride in their dependent condition are shamelessly abused. Moreover, the creditors are not phantom investors abroad, but rather concentrated business conglomerates based inside the country. A great many tactics are available to negotiate a suspension of a probably fraudulent debt. The library of juridical bases to justify such a measure is monumental, and the only real challenge lies in substituting highfalutin declarations with concrete actions. But it is necessary to remember that any measure against the creditors will be viable only if it is adopted as a part of a holistic economic reconstruction plan. For example, a moratorium divorced from direct control over the banks and the foreign trade will lead to chaos similar to that created by Alan García in Peru in the mid 1980s. The current debate on economic programs is dominated by anti-liberal proposals set against the prevalent neoliberal model. Capitalism, in these discussions, is considered to be an immovable fact of nature, forgetting that this system periodically recreates its own crises and engenders terrible suffering for the majority of the population. Therefore a third, socialist option must be considered—one that aims to overcome commercial tyranny through democratic planning. A popular alternative built around an increase in purchasing power, the undoing of privatizations, and the suspension of debt payments is the point of departure for this project of social emancipation. Notes 1. Consejo de Investigaciones Científicas y Técnicas (Council of Scientific and Technological Research), a scientific and technical institute with public funding—Ed. 2. It is not clear what the author meant by blanqueo. He was probably referring to money laundering—Ed.