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NEW DAY

Winter Storms Batters U.S.; Airport Chaos; Russian Bombing Mastermind Killed; Syria Will Miss Deadline; CEO's Salary Debate

Aired February 5, 2014 - 08:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


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(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Temperatures right now are perfect for icy conditions.

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CHRIS CUOMO, CNN ANCHOR: Here we go again -- a full third of the country getting slammed by yet another snowstorm this morning. The Northeast bracing for a foot or more. Take a look at this plane trapped in the snow and perhaps the biggest storm yet right behind this one.

KATE BOLDUAN, CNN ANCHOR: Breaking overnight -- four people arrested in connection with the death of Philip Seymour Hoffman. What role did they play in the drugs that likely killed him? We have new details on the investigation.

MICHAELA PEREIRA, CNN ANCHOR: CEO outrage. She broke the glass ceiling by becoming the first CEO of a major car company. So why is the G.M. CEO making so much less money than her male predecessor?

CUOMO: Your NEW DAY continues right now.

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ANNOUNCER: This is NEW DAY, with Chris Cuomo, Kate Bolduan and Michaela Pereira.

BOLDUAN: Good morning and welcome to NEW DAY. It's Wednesday, February 5th, 8:00 in the East.

And the winter torture unfortunately is not letting up. Another enormous storm is dropping snow and ice on 32 states from Wyoming to Maine. Right now, the Northeast is getting slammed with parts of New England facing a foot of snow or even more. They are already trying to dig out in the Midwest. Whiteout conditions forcing drivers to abandon their cars on I-64 in southern Illinois.

And just look out the conditions in Kansas City, this Southwest Airlines jet landed safely but never made to it the gate because it wound up stuck in a snow drift.

Our extreme weather coverage begins with our meteorologist Chad Myers here in New York Central Park.

How's it looking, Chad?

CHAD MYERS, AMS METEOROLOGIST: It's looking wet. That's bad because it's 31. It's raining now. This is the issue.

All this muck down here is going to freeze again later on today and with freezing at 31, we're going to lose power, we're going to lose power lines, we're going to lose tree limbs and all that is going to get worse later on tonight. This is just the second now of four storms. I know there were three. There's another one for next Thursday. This is just the second.

(BEGIN VIDEOTAPE)

MYERS (voice-over): From Wyoming to Maine, more than 100 million people are waking up to another round of snow and ice this morning.

UNIDENTIFIED MALE: Horrible. Horrible.

MYERS: Overnight, snow beginning to pileup in New England where more than a foot of snow is forecast in some parts.

UNIDENTIFIED MALE: It's been crazy. It's snowpocalypse.

MYERS: In the Midwest, up to 11 inches of snow blanketed parts of Kansas. Watch as this truck spins out of the control on the highway. Icy roads already claiming two lives in Crawford County. The state's governor has declared a state of emergency.

In Illinois, whiteout conditions coupled with sleet and ice sent car after car skidding off the road. Snow emergencies declared across Southern Michigan as heavy snow fell at a rate of an inch per hour, creating these massive snow piles in a Wal-Mart parking lot.

UNIDENTIFIED FEMALE: We've had crews out since early morning.

MYERS: Down South, icy roads leading to this fatal crash.

UNIDENTIFIED MALE: The temperatures right now are perfect for icy conditions.

MYERS: And in Oklahoma, a school bus transporting students had to turn around because the driver feared getting stuck.

We're still six weeks away from spring, but people are already fed up with winter.

UNIDENTIFIED MALE: It's beautiful for a little bit. But too many times, yes, it makes it a hassle to get around.

MYERS: This is the seventh winter storm battering the Midwest and New England since December. Nearly 40 inches of snow have fallen in Detroit last month alone and across the country it's the coldest winter in 20 years.

(END VIDEOTAPE)

MYERS: Chris, this is what the pillar looks like over here at merchant's gate. That is all shine ice. That's what the roadways are going to look like later on today as well.

Here's your forecast, you can see where the snow is. It's all the way from Boston, back to Buffalo, and for that matter, further West than that where it was snowing most of the overnight hours. Now, we're going to see the heavy snow from western New York through Batavia, Binghamton, back toward Saratoga and then into Maine. That's where the heaviest snow will be but where we are right here, this is an ice storm.

People walking by saying, when is it going back to snow? No, it's not. This is an ice storm. The snow is gone. The warm air is aloft, and we are going to see an ice storm all day long here. Power lines will be coming down for sure.

No question about it. I know we talked about the storm yesterday, Chris, about Sunday but there's another one for next Thursday that I'm even more worried about. The Sunday storm has backed off a little bit.

But these storms are like planes lined up at LaGuardia just one right after another. Maybe the planes aren't lined up at LaGuardia today because there are so many cancellations, Chris.

CUOMO: That's true. It's probably both. They are probably lined up and there are cancellations.

And you said this is the second of a third. And now, you're saying may be a fourth. That big demonstration you just made ice, so much more dangerous than snow, especially when it comes to driving. That's why drivers across New England are being told to stay off the roads.

<08:05:00>

This storm is delivering this double whammy, a foot of snow or more and then on top of that then, as Chad just explained, up to half an inch of ice. So, to state the obvious: driving and ice a recipe for trouble.

Let's go to Margaret Conley. We are every where you shouldn't be this morning.

Margaret, you're up in Boston. What's the situation?

MARGARET CONLEY, CNN CORRESPONDENT: Chris, we're seeing about one to two inches of snow per hour through the afternoon. If you take a look at the scene around me here, people are out walking their dogs but the snow is heavy, it's wet and it's coming down fast.

The Department of Transportation has 200,000 tons of salt ready, 3,000 plows are on the roads already, they have a capacity of about 4,000. So, you can see what they are dealing with. They are advising people to avoid unnecessary travel and they also advise people to use public transportation.

If you are flying, Logan airport has cancelled 45 percent of their flights this morning. Boston's new mayor has declared a snow emergency here. Public schools are closed. And as you have been saying it's not over. This is just one storm now, and in a few days, we're going to be getting more -- Kate.

BOLDUAN: We're watching the snow accumulate on your poor hat Margaret as the morning goes on. Thank you so much for that.

So, a familiar scene at East Coast airports unfortunately. It's complete chaos. Well over 3,000 flights have been canceled since yesterday and that number is climbing.

Our storm coverage continues now with Rene Marsh, live in Reagan National Airport outside Washington.

Good morning, Rene.

RENE MARSH, CNN AVIATION AND GOVERNMENT REGULATION CORRESPONDENT: Good morning, Kate.

You know, early indications, it is going to be in a word "bad" for people who are looking to get to their destination by a plane today. So, why do we say this?

Well, yesterday, when we were here early morning hours, we were talking about cancellations close to 600. But this morning early hours, we were already starting out the day with more than 2,000 cancellations.

At this hour, still more than 2,000 cancellations and we're talking about more than 2,500 delays. Take a look at the boards here at Reagan -- canceled, canceled, canceled. Problem areas we're talking about New York, New Jersey, as well as Philadelphia, Boston and Chicago. The usual suspect.

This weather really creating a nightmare situation for travelers. Take at that look at this video. This is right out of Kansas City. This happening where a Southwest plane goes into a snow drift as it was taxiing to the terminal.

So, just another, another example of how this weather is making things really tough for people trying to get to their destination by air.

Back to you, Chris.

CUOMO: All right. Rene, thank you very much for that.

Breaking news this morning as well. The man authorities say was behind December's bombings in Volgograd, Russia, has been killed. The coordinated attacks at a train station and on a bus killed more than 30 and heightened security fears around the Olympics. Now, police in Dagestan say one man was killed and accomplice surrendered in a standoff just this morning. All this two days before the Olympics begin.

Let's get right to Phil Black in Moscow with the latest -- Phil.

PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Chris, those Volgograd bombings are a big red flag to the world about the potential domestic terror threats that exist in this country, particularly in the context of the Olympics. Russian security services have been work very hard to track down those responsible.

A week ago, they found two men accused of transporting the suicide bombers to Volgograd. Today, they say they surrounded a house in Dagestan. During this operation, one man gave himself up. Everyone else inside the house decided to shoot it out. They were all killed, including, according to this report, one man who they believe was the mastermind behind the Volgograd attacks.

Now, finding out who is responsible for the Volgograd attacks is important because this group has shown they are capable of carrying attacks which can killed dozens of people, and they have promised through a video and if you had a Web site, that there would be more such attacks to come during the Olympics.

And the other big lesson from these attacks in Volgograd was that these terrorists do not need to hit Sochi itself in order to make their point, score a win and embarrass the Russian government during the Olympics. The Russian government maintains its security crackdown, it's ring of steel around Sochi itself is secure and these games will be safe.

Kate, back to you.

BOLDUAN: All right. Phil, thank you so much.

So, this latest terror news will likely only add really to the fears -- despite what people say -- only add that people have about security at the games. And right now, U.S. intelligence officials are said to be monitoring a number of specific threats against the Sochi Games.

So, let's get straight over to Barbara Starr live at the Pentagon for us this morning with more on this angle -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Good morning, Kate.

U.S. intelligence officials testified before Congress saying they are monitoring specific threats against the Sochi games, threats of varying credibility but they are working with the Russians now to monitor those threats and disrupt them where they see them, obviously looking at several known terrorist organizations in that region of Russia.

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U.S. intelligence officials also saying at this point they believe the games themselves, the venues heavily secured by the Russians but the big worry are other soft targets, train stations, shops, restaurant, outside of Sochi. These may be the big threats and they may be impossible to protect -- Kate.

BOLDUAN: Barbara Starr at the Pentagon for us -- Barbara, thank you so much.

More breaking news to tell you about this morning -- a surprising move by the pharmacy chain CVS.

Just announced, it will no longer sell cigarettes and tobacco products in stores nationwide. The move takes effect in more than 7,600 stores come October 1st.

Chief business correspondent Christine Romans is here with more.

This is surprising.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: It's big news. It's a big pharmacy chain. And this company is saying that selling cigarettes and tobacco products not consistent with what it does as a health care chain, a pharmacy chain. Here's what the CEO saying -- he's saying ending the sale of tobacco products is the right thing for this company to do for their customers, for their company to help people on their path to better health.

Put simply: and here I think is really the salient people from the CEO, the sale of tobacco products is inconsistent with our purpose. That's Larry Merlo, who runs the company.

And the president of the United States, a former smoker, coming out and saying, good work CVS, good work, Larry Merlo, and he hopes more people follow suit.

BOLDUAN: The harsh reality, though for Larry is also the purpose of his company is also to make money. How much of a hit are they are going to talk for it?

ROMANS: They're going to be saying "no, thank you" to about $2 billion from smokers who buy tobacco products from CVS pharmacies. But, look, that is a smaller and smaller customer base every year. In 1965, 42 percent Americans were smokers. Today, it's 19 percent.

So, you can see the growth in this economy, the growth for these markets is for smoking cessation products, which CVS is going to do -- for these small clinics where they are giving flu shots, these minute clinics they have, where they're giving health care advice, where they're keeping people healthy, as we get older, many of us get older and need more health care, not by selling these products.

BOLDUAN: So, is this -- do you see this as CVS getting out in front of what could be a trend?

ROMANS: They are a vanguard. We called Walgreens this morning. Walgreens says that they are evaluating this product category. I suspect all of the retailers like this -- the drugstore retailers are evaluating this product category.

Walgreen making a very good point they offer smoking cessation, how to quit smoking products and devices and that's important for them, for the health of this country.

I will say the health care advocates are very, very happy about this. They think it's incredibly important leadership from a big company, giving up $2 billion.

BOLDUAN: Two billion dollars is nothing to sneeze at.

ROMANS: But there's a lot of other growth areas in this company and they are focusing on the health of their customers. Remember, 5 million people die a year from smoking related illness.

BOLDUAN: Sure, impressive move by CVS.

ROMANS: Yes.

BOLDUAN: Christine, thank you.

ROMANS: You're welcome.

CUOMO: Also breaking overnight in New York, police arresting four people believed to be connected to drugs found at Philip Seymour Hoffman's apartment. This morning, we're learning new details about that daring raid and about the drugs that were found around Hoffman's body.

Nischelle Turner joins us with the latest -- Nischelle.

NISCHELLE TURNER, CNN CORRESPONDENT: Well, Chris, big developments overnight. The NYPD raided an apartment in Manhattan last night, executing search warrants and arresting four people. Police are now questioning them about the drugs found inside Philip Seymour Hoffman's Manhattan apartment.

(BEGIN VIDEOTAPE)

TURNER (voice-over): Overnight, police arrested three men and a woman in this New York apartment building who they believe are connected to the drugs found in Philip Seymour Hoffman's apartment. During the raid, police recovered 350 bags thought to be heroin.

These as new details are emerging about his death, the result of an apparent heroin overdose. A law enforcement source says preliminary results show the heroin found in Hoffman's apartment was not laced with the strong painkiller Fentanyl.

On Tuesday, Hoffman's former partner, Mimi O'Donnell was seen here at a local funeral home. O'Donnell reportedly told Hoffman to move into another apartment in the city, not with her children, when she discovered he was abusing drugs, an ongoing battle he recently shared with magazine writer, John Arundel.

JOHN ARUNDEL, MAGAZINE WRITER: He took off his hat and he said, I'm a heroin addict.

TURNER: Arundel says Hoffman made this confession two weeks before his death, during a one-on-one chat at the Sundance Film Festival. Hoffman saying he just got out of rehab.

ARUNDEL: He seemed like he was having one of those coming to God moments where it just struck him as, you know, this is the revelatory moment.

TURNER: The night before Hoffman died, CNN has also learned that he withdrew $1,200 in six transactions from this ATM at the grocery store near his apartment. A witness telling investigators he saw Hoffman talking to two men wearing messenger bags.

The next morning, Hoffman was found dead in his bathroom, a needle still in his arm.

MATT DAMON, ACTOR: He was a really special human being. He was one of the best actors to ever live, without a doubt.

<08:15:07>

TURNER: Hoffman's friends and colleagues mourned his loss at New York's the monument (INAUDIBLE) Tuesday night.

GEORGE CLOONEY, ACTOR AND FRIEND OF PHILIP SEYMOUR HOFFMAN: Had dinner with him a couple of months ago and I have to say he seemed to be in pretty good shape. There's no way to explain it.

DAMON: Does something ever come out of it? Like, is there, you know, is there somebody watching who goes, wow, that guy was amazing. Maybe I should just stop doing this. Maybe I should try to find help.

(END VIDEOTAPE)

TURNER (on-camera): Now, Philip Seymour Hoffman's representatives have announced there will be a private funeral service held in New York for the actor's family and close friends. Also in the works, plans for a memorial service later on in the month -- Michaela.

MICHAELA PEREIRA, CNN ANCHOR: All right. Nischelle, thank you for that.

Let's take a look at your other headlines at this hour.

(BEGIN VIDEOTAPE)

PEREIRA (voice-over): Republicans are pouncing on a new report from the Congressional Budget Office that says Obamacare could reduce the U.S. workforce by the equivalent of over two million jobs. Many of those workers opting to collect higher health care subsidies and work fewer hours. The White House pushing back saying that since the law was passed in 2010, the nation has seen the strongest job growth in decades.

A watch group says Syria will miss a key chemical weapons deadline. Almost all chemicals and precursors are supposed to be removed no later than today. But only about four percent of the chemicals have been destroyed. Russia blames logistical problems at Syria's port, but, it says all chemicals should be out of the country by March 1st. Syria's entire chemical arsenal is supposed to be destroyed by June.

More cheating allegations against members of the armed services. The navy is now investigating whether sailors cheated on tests on nuclear reactors -- were cheating on those written tests. At least 12 sailors are believed to be involved. The number could be as high as 30. Now, this is the third time in three weeks the military has addressed charges of cheating on exams.

Just into CNN, U.S. snowboarding star, Shaun White, is withdrawing from the slope-style snowboarding competition at the winter Olympics. Instead, he is saying that he wants to focus on winning the half-pipe event, an event he has already won two gold medals for in the past. White also expressed concern about getting injured in the slope-style. Two other athletes have already been hurt on that course.

And some pretty amazing video to show you. It's new. British surfers wild ride. That in the little dot there looking super tiny as Andrew Cotton taking a monster 80-foot weave in Portugal. Not official yet. But cotton may have broken his own world record setback in October when he surfed a 78-foot wave.

(END VIDEOTAPE)

CHRIS CUOMO, CNN ANCHOR: Is this the guy we interviewed?

PEREIRA (voice-over): That is -- is that the guy?

(CROSSTALK)

PEREIRA: It's not the same guy that we interview.

CUOMO: Remember the guy --

(CROSSTALK)

PEREIRA: But they're getting some crazy big waves off the coast of Portugal.

KATE BOLDUAN, CNN ANCHOR: That is crazy!

CUOMO: How about -- what is that like, I imagine?

BOLDUAN: I don't know if there's anything to compare to it.

CUOMO: -- all this white whiter is coming, coming, coming --

BOLDUAN: An avalanche?

CUOMO: Right. And then it gets you --

BOLDUAN: More like an avalanche.

(CROSSTALK)

BOLDUAN: Yes. Maybe. All right. Coming up next on NEW DAY, she's a pioneer in the auto industry, the first female CEO of GM. So, why does Mary Barra's salary appear to be half of what the man she replaced was making? We're digging deeper on that and the response from General Motors ahead.

CUOMO: Plus, old man winter just won't quit and he's having a chilling effect on the economy as well. What that could mean for you and your money when we come back.

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BOLDUAN: Welcome back to NEW DAY. The new CEO of General Motors, Mary Barra, is the first woman to run a major automaker. But her salary is sparking some heated debate over pay inequality with some claiming she's making considerably less than her predecessor. The calculation shows Barra's announced salary to this point, and that's a key point, is $4.4 million. Well, Dan Akerson made $9.1 million last year.

But General Motors says Barra's long-term compensation package, one element of it, yet to be announced, will close that gap. Let's talk more about this. Let's bring in Katrina Vanden Heuvel, editor and publisher of "The Nation." Thank you so much for coming. There's more to this than the headlines, but let me first get your take.

KATRINA VANDEN HEUVEL, EDITOR AND PUBLISHER, THE NATION: My take is it's great that we have a woman who's blasted the steel ceiling --

(CROSSTALK)

HEUVEL: -- running one of the three big automakers. But, I think you see in her pay package, first of all, you know, the major women at the Fortune 500 companies across the board make 18 percent less than their male counterparts. You're already looking at that pay inequality. But you're also looking, let's be honest, at a woman who's making a lot more than most women will ever see in their lifetime.

So, we talk about pay inequality and there's another kind of pay inequality which is, you know, two-thirds of women living on minimum wage. So, you know, I think that needs to be accounted for. I do think there's an old boys network. If you look at the boards of these auto companies, sorry, I'm looking at you, but --

(LAUGHTER)

HEUVEL: You got to really bring women into all of these positions across the board because, you know, they're still favoring the network.

CUOMO: But is there a little bit of -- let's take some progress where we find it here.

HEUVEL: Sure. CUOMO: I mean, this is a little misleading. All right. We have to find out what the long term aspect of the package. We don't know yet. He held two jobs, Ackerson. She's only making $100,000 less in base salary, but she's only doing one of the two jobs --

HEUVEL: Because she's also someone who spent 30 years -- 33 years in the company. She describes herself as a car gal. She rose up through the ranks. He came in, Ackerson, someone from Carlisle, private equity fund, and just sort of alighted. And, I guess the larger problem is these compensation packages. Take a hard look at them for men and women.

They're out sized. You know, there's a new S.E.C. rule with the Dodd- Frank legislation that companies need to account for the disparity, the gap between CEO wages and worker's wages. And in this country over the last two years, it's 400-1. 400-1. I mean, that --

PEREIRA: You'll never get a person that will be as upset and up in arms as I am because I find this upsetting. But another point that needs to be made is that he had prior CEO experience. She did not, correct? He was CEO twice before, correct, in other companies?

HEUVEL: Well, he came out of, again, a private equity fund and we can discuss what private equity funds do in this country. Some of them create jobs, some of them don't. But I do think we need to look harder why we're still -- women are paid 77 cents on the dollar, right? Why Paycheck Fairness Protection Act is still hanging around in Congress?

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HEUVEL: And isn't it just kind of makes sense for our economy to stimulate our economy that women who hold up half the sky get paid close to --

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(CROSSTALK)

CUOMO: We just had Bob Moritz on from PricewaterhouseCoopers. And he did a big study there at the companies that not having diversity in the workplace is one of the biggest things holding back the U.S. economy. And you know, we did hear the president in the state of the union outline it and everybody is worried about his legacy concerns, you know, within his own administration. I wonder why he doesn't jump up and down about this and make it a signature cause. I'm going to get women paid equally.

HEUVEL: But he did. He did in the state of union.

(CROSSTALK)

CUOMO: -- make it happen.

HEUVEL: Well, excuse me, Chris, have you checked out the Congress recently? Not a lot is going through there. The Paycheck Fairness Protection Act has passed to the House twice and is just gridlocked in the Senate. Now, he could take executive action in certain areas.

CUOMO: Democrats can --

HEUVEL: You know, as he said, I loved his line -- partly wrong, but you know, this is not a mad man's -- this company, these automaker companies are sort of like the madmen companies. Now, they're changing because to its credit, GM has more women on its --

(CROSSTALK)

BOLDUAN: Five women and nine men under board.

HEUVEL: She has elevated more women.

BOLDUAN: One interesting part about this, I think we should consider is that Barra -- we need to learn more about our conversation. And GM put out a statement saying the discussion of paying inequality between Barra and her predecessor is premature and flawed because they haven't given her a full detailing of her compensation package.

But if you think about it, she's the first CEO to be coming in that is not under federal limits any more. She's actually might be in a better position to see more pay because the CEOs in the past where subject to federal limits.

HEUVEL: But Kate, you know, the U.S. government invested in the bailout process in GM and lost $11 billion. I think the bailout was important. It saved 2.6 million jobs. It saved the economy money. Like, why should the CEOs of any of these -- now, Ford went into bankruptcy wasn't part of the government bailout, but why should any of these companies be raking in as much at the CEO level, you know, when you accept a bail out? So, it is the case --

CUOMO: Because they give a ton of money to politicians. That's why.

HEUVEL: Thank you, Chris.

(CROSSTALK)

CUOMO: They are a special interest group that outwins the voters in the power balance that --

HEUVEL: But I do think it's important to use her case as one to argue for women across the board earning the same as men, equal pay, not just 77 percent on the dollar or 69 percent --

(CROSSTALK)

CUOMO: Somebody is against it, right?

HEUVEL: Right.

BOLDUAN: I think this case, Barra's case, is not as black and white on the issue because we don't have all the detailing of her salary and her compensation, but I agree. Using it as a discussion point to talk more about pay inequality because men and women is important. CUOMO: Because you have it as an industry standard that women make less. It would be a great signature issue. It would be a great legacy issue. The Democrats control the Senate. If that's where it's held up, who's keeping it from passing?

HEUVEL: Also, I have to say, men and women, but raise the issue of CEO pay, because it does contribute to the inequality that's become a defining issue of our time.

BOLDUAN: Katrina, great to see you. Thanks so much.

HEUVEL: Thank you. Thank you.

BOLDUAN: All right. Let's take a break. Coming up next on NEW DAY, the relentless winter weather landing another punch this morning with hundreds of thousands without power already. So, how is it affecting you and what has the hit -- what has the hit been to the economy all this winter weather? That, still ahead.

CUOMO: And remember the horrible hack attack at Target. Now, the silver lining, the retail industry stepping up to keep your personal information safe or more safe. But we're going to take you through the proposals and you can see if there are enough to stay ahead at the hackers. Too little too late? Maybe. We'll explain.

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