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November 11th, 2008
09:25 PM ET

Evening Buzz: Another Bailout?

President Bush and President-elect Barack Obama meet in the Oval Office on Monday.

President Bush and President-elect Barack Obama meet in the Oval Office on Monday.

Maureen Miller
AC360° Writer

Tonight, we've learned new details on President-elect Barack Obama's meeting with President Bush in the Oval Office.

Sources on the Obama transition team say Mr. Obama urged Pres. Bush to take action to help the U.S. auto industry.

Here's a big reason why: 1,900 hourly workers are getting laid off at GM. That's on top of the 3,600 last week. And, shares of GM have fallen to their lowest level since World War Two.

America's so-called "big three" automakers (GM, Ford & Chrysler) are hurting badly. But should the U.S. government bail them out? We'd love to hear your thoughts.

A source tells CNN that Obama also talked with Pres. Bush about the need for a second stimulus package and an aid package for homeowners facing possible foreclosure.

And on this Veterans Day we're looking at Obama's battle plans for Iraq and Afghanistan. No new president has ever had to face so much on the job. CNN's National Security Analyst Peter Bergen has written a letter to Obama on how to rescue the war in Afghanistan. CLICK HERE TO READ BERGEN'S LETTER

Also tonight, President Bush talks with CNN's Heidi Collins. Hear what he says he regrets about his presidency and what he plans to do after he leaves the White House.

All that and more on AC360° at 10pm ET.


Filed under: Maureen Miller • The Buzz
soundoff (98 Responses)
  1. Shirley K Raleigh, NC

    Regarding bailing out the Big 3.
    Don't bail them out until they agree to bring the jobs back to the US.
    Do they really think their laid off employees can afford a new car?

    November 11, 2008 at 11:22 pm |
  2. James Emrich

    Hi Anderson,
    I think a smart way to get rid of the Unions without having to lose all those jobs would be to buy out the company and turn it over to the employees with the mandate to retool and go green. GM has some good engineering, they just need a new direction. That way we go green and get rid of the Unions that are were good years ago but not anymore.
    Obviously it would not be so simple but it's doable.
    Greetings
    Houston, TX

    November 11, 2008 at 11:22 pm |
  3. Susan

    Question:
    Wasn't it in 1979 that the US Gov't bailed out Chrysler? It was reported that they paid the gov't back in record time. During that time a new car sales went from $5,000.00 to $15,000.00 Chrysler leading the way. Here we go again?

    November 11, 2008 at 11:22 pm |
  4. Sandra L. Reed-Mansfield Ohio

    The Big Three and all of it's employees should bail their own selves out, just take a huge salary and benefit cut. Problem solved!

    November 11, 2008 at 11:22 pm |
  5. Pat from michigan

    why not loan the auto company money?
    the Banks got it and they are mostly investor from outside the USA
    all the auto companys are asking for is a LOAN.
    We are a auto family

    November 11, 2008 at 11:21 pm |
  6. Peter MacKay

    I have been a GM fan my whole life. I have just completed a conversion of a Chevy S-10 into an all electric vehicle. I did this because GM crushed every single EV-1 (electric car) they built.

    If GM wants to make some money then they should start up the factory that built the EV-1's. GM had willing, paying customers ready to buy these cars and yet GM crushed them all anyway.

    Shame on them.

    November 11, 2008 at 11:21 pm |
  7. Big Al

    I feel we need to bail out the big three but I feel the unions must give up their unreasonable contracts. I don't feel we should pay the money for the UAW wages. If they would accept a simillar contract to the workers of Toyota and Honda. They need to keep themself in business. They should meet the country halfway.

    November 11, 2008 at 11:21 pm |
  8. Glenn, Florida

    I'm all for the Free Market; however, since the Big 3 comes to DC for handouts every few years, make them give 30% of their stock to the government, have all stock dividend payments deposited in the Social Security Trust fund, and require the Big 3's management to take remedial economics courses (or maybe have them co-op with the foreign automakers to find out how to do it right).

    November 11, 2008 at 11:21 pm |
  9. Bonnie

    We supposed to have bailed out the financial markets.

    Now they want to bail out car manufacturers.

    Do we next bail out Macy's, Nordstroms, Target and so forth?

    We, the public, have been made to spend and spend on cars, clothes, groceries and every thing else that we need to live. Now we are not buying and everybody is screaming for a bail out.

    It is not going to make any difference which businesses are bailed out, we are not going to spend money because we are all too worried about losing our jobs, our homes, our education, paying for gas and electricity to heat our homes.

    The part of the bail out of the financial institutions that was designed to help homeowners that were already in default on their payments. There was no provision for homeowners that

    November 11, 2008 at 11:21 pm |
  10. cheryl

    I can't believe what i just heard, the government doesn't want to help the auto industry but the can bail out AIG?????
    What's up – AIG stole millions of dollars – and we baile

    November 11, 2008 at 11:19 pm |
  11. Ray

    No waqy!!!!!!!!!!!! Let them reorganize under chapter 11 or let Nancy Pelosi bail them out

    November 11, 2008 at 11:19 pm |
  12. Rachel, Florida

    I don't understand how we can call this a free market system if we are funding our capitalist insituitions. I want to know why bailing out corporations that are doing nothing to help with the fossil fuel situation is okay, yet we do not want to fund our own Health Care system so that every person can live a healthy life without a corporation making a profit off of their sickness?

    November 11, 2008 at 11:19 pm |
  13. Liz

    I agree with Jeanette --"I don’t think we should bail out the car industry because they knew years ago they should be making better, cheaper and better gas mileage cars but were just interested in making money. Now no one can afford them and can’t afford the gas to put in them. Everyone didn’t want these big gas guzzlers, if they did all the foreign cars would not be so popular."

    Who can afford these cars??? And the wars for oil! One other thing I'd like to add, is no lay-offs of the workers - have the CEO's and management take cuts...big cuts...! Maybe lay-off some of them??
    It's indeed time for a change, when CEO's make hundreds of times over what their average worker makes. No one is worth that much??
    Especially, people making bad decisions!

    November 11, 2008 at 11:19 pm |
  14. Brandon, Texas

    I can't believe congress is really thinking about a bailout of these car companies! There is no way to keep these companies in business except for people to start buying cars again. If we give them money now, in 9 months, they will need it again because they are not making money running the business they are in! If they want to keep afloat they should be selling cars that people want to buy. It's as easy as that! There is no business in a free market economy that can make a profit if it doesn't make and sell what people are willing to buy! Why can no one see this? It's maddening!

    November 11, 2008 at 11:12 pm |
  15. Liz Levine

    No! No! No!
    I do not want to bailout the auto industry. For years, the American auto industry has not been making cars the public wants. If we bail them out now, we will continue to bail them out forever. They do not represent the future. They represent the past. We need to let them go and make room for new American ingenuity. We need smaller cars, cars that are fuel efficient, cars that use alternative fuels. The Big 3 have had years to come up with a viable solution. They have not.

    Are we going to bail out every company? Do the American people have to buy stock in every company that is going to fail? I say no!!!!

    November 11, 2008 at 11:04 pm |
  16. Susan, Florida

    Everyone is writing that the "big 3" are making cars that the U.S. citizens don't want......that is not true. I can remember when everyone wanted and owned a SUV. Come-on......gas was cheap back then. The SUV was great for we "big/large people" who live in the U.S. Nothing worse than crawling down into a little tiny vehicle. We were spoiled when gas was cheaper. Now we have to Crawl-Down-Into-A-Tiny-Car.....Yikes!!!!

    November 11, 2008 at 11:00 pm |
  17. Nicolle-NYS

    President Elect Obama don't bail the companies out, bail the people out. Provide asistance those who have lost and will lose their jobs. Providing them with funding to further eductaion or pursue other career opportunities. In addition, providing them with funds to support them in the meantime

    November 11, 2008 at 10:57 pm |
  18. Sridhar Anandula

    I live in MI and I would love to see a bailout for the auto industry with a selfish motive. But frankly, there should not be any bailout for auto or financial industry. When the visionary plans of the CEO's were being made, obviously tax payers or govt was not involved. These plans and the plans were made with the short vision of the CEO's. If that is the case, why should the outsiders to the industry bail them out and to what cost would that be. This was a known outcome to the industry, being private it needs to be competitive to the outside world to which it has not be. Lie I said, to overcome the current situation there probablt a bail out might to it. But CEO's of the companies have to realize what the role of the company is and how it plays it out in global competition rather than locally. Then decide whether you will survive or what you need to do to survive.

    November 11, 2008 at 10:55 pm |
  19. Philip Gurrieri

    The North American units of the Big Three should not be bailed out. In actuality, we as a nation are in the midst of a corporate coupe of our government. The auto industry is there at the behest of the corporate Petro-cartels.

    Open our archaic auto industry to the global market and invite the specific alternative energy auto industries to come and bid on the sites that come with an appreciative labour force wanting the opportunity to truly earn a living with a concern for people first.

    Can’t be done? Nonsense, we are now All True American’s from the Tip of Chile to the Tip of Alaska, now including the United States of American’s in the Americas………. Now, be PROUD American’s & say NO to any corporate bail out……………

    Philip Gurrieri
    Ulster, USA

    November 11, 2008 at 10:54 pm |
  20. Norm

    Why should the automotive companies be given special consideration? Why is automotive such an important industry. US machine tool industry has been decimated over the years. No one is worried about it. Why is the automotive industry more important?
    Why should the automotive worker's insurance be the responsibility of the government? I worked in the machine tool industry. When my company filed bankrupt there was no one to save us. Our insurance was gone the day bankruptcy was filed. There was no one at the entrance to help us.
    It is my opinion that the state of the automotive industry is the result of management and employees actions. Management made poor business decisions and employees through labor bargaining created the legacy cost. Both are have caused the situation it is in and need to live with their actions.
    Let the automotive companies file for bankruptcy. The valuable assets will be sold and can become viable companies. This is free market eliminating the weak and inefficient.
    Norm

    November 11, 2008 at 10:52 pm |
  21. Gary in Idaho

    I agree that sending billons of tax payer dollars to the auto makers seems like throwing good mony after bad, but why can't we send large tax rebates or tax credits back to taxpayers that purchase a vehicle produced here in the USA over the next year or two ?
    It would first , motivate consumers to come out of their cave and enter the market place again and help the middle class with a tax break. Second, it would help clear the car lots of slow moving inventory and keep the car dealers in business.Third, it would keep the auto workers on the line working and paying taxes and strengthen the parts industry with renewed demand.
    Finally, why not pro-rate the tax break to higher gas mileage , especially going forward to encourage better vehicles?

    November 11, 2008 at 10:51 pm |
  22. Annette

    Auto manufacturers try to build what consumers want. All was well until gas prices hit $4.00 and more per gallon. I think you can blame those who predict what the price of oil will be, after all, if they projected prices to be $4.00 a gallon they were just preparing you for it to happen!! Panic!! I think we need to get rid of these guys!! We had three shifts at our Toledo Jeep plant, third shift was eliminated in February and our second shift will end in December. With 24years of service I am 11 months "safe". With all the down weeks we have had (approx. 12 since July) their is no doubt in my mind that gas prices played the biggest part in the auto downturn. With1600 jobs gone, and the rest of us on unemployment benefits, think of how much consumer power is lost!! Now think of the suppliers who ship us parts-their workers-more job loss-more consumer power lost! Now think of the places we as consumers buy from- if we are all cutting back- You may be the next one to loose Your job!!!!!

    November 11, 2008 at 10:49 pm |
  23. Joseph - Florida

    The GM bailout and other bailouts need to occur. The government is responsible of not watching WallStreet, and now all industries are on the verge of collaspe. With GM and other bailouts, the Government should appointment an indepentment firm such as PricewaterhouseCoopers to be a member of the board to watch the Govenment's money and provide recommendations including restructing. If the Government fails to do anything, we will continue to lose jobs across all industies until the system is in total collaspe. I disagree this burden should be placed on all Americans, and should be scaled based on income.

    November 11, 2008 at 10:48 pm |
  24. Susan, Florida

    If we the U.S. can bail out the very rich Wall Street Bankers, Investment Banks, Insurance Companies who were involved in the Credit Default Swaps; then we can also help out the “big three” automakers…..giving them time to retool to produce energy efficient vehicles by a certain period of time. Also, the U.S. may have to review and revise the vehicle crash criteria……as the “big three” already make vehicles that are very energy efficient that are sold in other countries but do not meet the US crash criteria.

    I am not sure that we Americans want to put the production of our very important mode of transportation into the hands of foreign companies. What would happen if that country(s) got mad at us and refused to import their vehicle to the U.S. I really don’t think we want to ever put ourselves into that position. This goes to many of our production industries …… we need to assure that we always keep in the U.S. (Steel, Automation, Food Production, etc.) We Americans need to assure that we always have the very basis items produced in the U. S. for our safe existence…..food, clothing, shelter, vehicles, electricity, heating gas, communications (telephone, computers, internet), etc. etc. We also need to assure that we have many different types of military production in the US……for self-defense.

    November 11, 2008 at 10:44 pm |
  25. Nan Cassidy

    bailout plan:

    Give the taxpayers a 50,000 VOUCHER for goods or services, not money. They can buy everything from a new fridge to a new car. Production up, people have job security and the economy booms again.

    November 11, 2008 at 10:41 pm |
  26. phillip

    I am against the bailout, i wasn't for the $ 700 Billion bailout either. when will these companies learn to build cars that people actually want to buy? i think that they shouldn't be allowed to become too big by acquiring too many smaller companies, because then, they will become too "big to fail", and we'll be back on square one. we have to let them file for bankruptcy and the whole restructuring process.

    Asian car makers aren't struggling as much as the big three, maybe we should learn from them and stop being such self-righteous, ignorant, big headed stubborn people. a collapse of the big three could be a good thing. yes, the economy will suffer, yes the industry that depends on the the big three's success will collapse, yes times will be tough.

    but, we will learn our lessons, restructure labor unions or simply eliminate them completely. most of all they [big three] will be reset and ready for the 21st century by building cars that people are willing to spend money on, spend more on R&D.

    also, unions need to understand that what's good for GM, Chrysler and Ford is good for them as well, so they have to find a way to meet these companies somewhere in the middle.

    November 11, 2008 at 10:40 pm |
  27. Bernice Martin

    These companies need to know how to cut cost. My take on this subject is that these Big 3 GM companies need to drop prices on vehicles that's already being produce and ship. Cutting cost will help cutomers to buy, for those who still are interesting in purchaseing new vehicles. This is the only way to jump start the economic again within the power of car buying. The companies may lose, but it better than going bankrupt. So cut cost and sell , better to sell and lose some, than not to sell at all.

    November 11, 2008 at 10:39 pm |
  28. julius butler

    Toyota, is sending major excess SUV to the middle East, and other markets, where Gas is cheaper (UAR $0.39/Gal.) GMC, Ford and Chysler are going to try and stuff their gas guzzlers down America's throat.The American products have improved steadily over the last decade, but so has the competition. The CEO's of GMC, Ford and Chrysler need to be taken out to the "woodshed." They will exit with their "Golden parachuets", while Joe BLow gets laid off. The Unions need to shoulder some of the blame as well. GMC Asia, is doing very well. They can't build enough of their vehicles to satisfy Chinese demand. Well that's going to change. Where is rational Industrial leadership? There is only one reason for aiding the "Auto Industry". To keep those jobs. These companies need to be reorganized with products desired by the Public and not hyped through the Advertising media.
    How did the Japanese products get so far ahead?

    November 11, 2008 at 10:38 pm |
  29. Eileen R.

    The bailout should happen with a stipulation that thier resources go into creating affordable hybrid or electric cars. Also, our government needs to amend the fair trade bill so that it is fair to our country. Enough of total saturation of imports while our own industries have limited export. that's not a competative market – it's a takeover. Also, America, do you really need that SUV to commute to work? No, so stop making them and put the effort into enviromentally cleaner cars, end our reliance on foreign oil, and save our jobs. 'nough said.

    November 11, 2008 at 10:36 pm |
  30. Paul

    I'm sorry I missed the groundrule on AC360 regarding the use of aliases. In an earlier post I used "Someone Who Knows The Deal" as the submitting blogger. My intent was more to indicate that I am familair with the deal wherein Cerebus acquired 80% of Chrysler. I am also knowledgeable of how private equity firms operate and the risks that are associated with injecting billions of dollars into Chrysler with no strings attached. (Or to GM for that matter–a few weeks ago they requested government funding so they could acquire Chrysler.) There would be a high risk that such a capital injection into Chrysler could result in making a few private equity partners very wealthy, as opposed to "saving" Chrysler which taxpayers would have intended with their expenditure.

    November 11, 2008 at 10:36 pm |
  31. Harriet Smith

    What a big mistake it would be if the government bailed out the American Auto industry. What good would it really do if the auto industry just kept on making the sub-par cars that only half the American buy. These cars are inferior to other cars made overseas and half the Americans know that. A bailout would just be throwing good money after bad. In this case, the "bad" means bad car design inside and outside.

    November 11, 2008 at 10:35 pm |
  32. carol kesling

    i say we take all the money back from AIG since they dont know how to spend it wisely !!!!! another expensive debacle of a weekend trip in arizona, i heard the CEO try to explain it away, ha,ha,ah..... take that money and give it to the automobile industrys to bail them out, then enough is enough !!!!!!!!! ITS TIME TO BAIL OUT PEOPLE LIKE ME THE LOWER CLASS SINCE THERE IS NO MORE "MIDDLE CLASS"!!!!!

    November 11, 2008 at 10:34 pm |
  33. Rob Hasskamp

    What happened to consequences??? It's unfortunate that the US auto industry (unions are part of this industry) beleives it is "entitled" to survive. I've worked for the same employer for 25 years. It's a company that is proudly celebrating it's 150 year anniversary this year as an American Icon known around the world. During my 25 year employment, we've (the company) has navigated a bankrupcy, but that was twenty years ago and the company is smarter, better, resilient and more tuned with our customers as a result. Challenge and adversity wake most of us up quickly. The question is... What will it take to wake up the US auto industry? Clearly they are not resilient or listening to their customer. As a consumer I desparately want to buy an American product, but sadly (or gladly) my last two vehicles have been fuel efficient German luxury vehicles. I'm just another American looking for the right American answer.

    Rob Hasskamp
    Bloomington, IN

    November 11, 2008 at 10:33 pm |
  34. Karen Joy

    It seems that everyone is in such denial over the bailout. My husband and I have decided that we will not buy another car until there is a big one that gets 50 miles to the gallon. Our auto industry is no where near that. The auto industry has had since 1976 to fix their problems. I am so for unions and believe they have helped working skilled people, but the auto industry workers are basically unskilled and overpaid.

    November 11, 2008 at 10:33 pm |
  35. fred bond

    Let the auto makers file chapter 11 and reorganize for the future.

    Enough is enough. AMEX is even going for public funds.

    This is getting crazy. We will be paying for this for generations.

    November 11, 2008 at 10:32 pm |
  36. himsten

    how can we bail out all these people when we cant get a bail out for the tax payers i cant even get the raise i need but we will help companys that wont help themself why must we when the cars of today cant get a mile off a gallon of gas the only way the big 3 should get help is by making new cars that get more than 15 miles to the gal other than that i say let em burn its my money and i chose not to give it to a company that have more money than god i need help help me

    November 11, 2008 at 10:32 pm |
  37. gernger

    Can we trust the auto industry:? Back in the 80s when Japanese cars first started taking over the American market, Japan put a voluntary quota on their exports to help the American car makers regain some of their lost market, re-open some lines and rehire laid off workers. They didn't do any of those things. All they did was raise the prices. When the Japanese got wind of that, they flooded the American market with their cars and have been doing it ever since.

    November 11, 2008 at 10:32 pm |
  38. Lee Denny

    Much like we heard today from AIG's CEO, the US auto industry is not looking for a hand out but rather guartanteed loans. The collapse of the US banking system has made the availability of captial almost non'existent for not only for GM, Ford and Chrysler but also for its dealers and suppliers, all of whom are independent businesses that employ millions of Americans and support hundreds of thousands of businesses that do business with them. GM sells more cars and trucks that get over 30 MPG highway than any other manufacturer. If someone else in the media says GM doesn't build cars and trucks people want I will vommit. They still lead the US in vehicle sales and are in a virtual tie with Toyota for world sales leadership. Their quality ratings surpass most imports and their service satisfaction ratings dwarf most imports, especially Toyota who finished 7th from last. It is about time the US consumer forgave the US auto industry for thier past sins and recoginised their current success by supporting this industry that employs one out of ten of them.

    Lee Denny
    GM Dealer
    Easton, Maryland

    November 11, 2008 at 10:32 pm |
  39. guate

    why help them if even after they recover they still going to make poor quality cars that we don't going to buy.

    November 11, 2008 at 10:31 pm |
  40. richard schumacher

    Bail out the BigThree by taking over all of their employee and retiree health care responsibilities. This would level their playing field and be a useful test of the concept.

    November 11, 2008 at 10:30 pm |
  41. Thomas Ahlbeck

    The government should not be in business. In the case of the auto industry, the government should not do a bailout or appoint an auto czar. The government job is to make the laws for markets and capitalism to work fairly and ethically. Due to the crisis state of the auto industry, some ideas might be to allow the deduction of the automobile interest or a rebate for the purchase of an American car. Government makes good rules or laws, business does well makes money and the Government get rewarded for good laws with tax revenue.

    November 11, 2008 at 10:30 pm |
  42. Mason

    I'm A union Retiree and feel bad for the Auto Ind. and UNION ...But ONE Big Question Why Do these Workers BUY and Drive Nonunion Cars from O V E R SEAS ? Now we will have to bail them out ..You are Union You should buy UNION.....

    November 11, 2008 at 10:29 pm |
  43. gretchen zuiderveen

    I am a 63 year-old Michigan resident,and remember talking about gas guzzlers and poorly made cars from Detroit when I was in college. Since then, gas mileage has always been a factor when my husband and I bought our cars, and we usually bought "foreign" cars for that reason.
    I think of a theoretical set of parents who give their children all the big, expensive, status-rich, and wasteful things that "they demand", only to wake up one day, to discover their "children" are disgusted with them, have no respect for them, and want nothing to do with them anymore.
    Seems to me, that's how our American car companies have treated their own people, and now, they've been abandoned. I'm not sure that rescuing them will bring them to their senses. I do wonder if the car companies sold their soul by giving in to too many union demands, and passed the cost of that onto the rest of us.

    If anything, how about telling the big 3 to huddle together, form one company, put their best people, plans, and equipment together to compete with what's out there and see if they can rise from the ashes.

    Is that an option? I'd support government assistance to an effort like that.

    November 11, 2008 at 10:29 pm |
  44. Dave

    I would rather see $25-50 billion go to the auto industry than to these companies like AIG. I have family in Michigan and the state is a wreck with just some company layoffs by the big 3. If all the dealerships and plants closed across the country the ripple effect would be astronomical. Sure, things might level off eventually but the immediate effect could put us in a downward spiral too difficult to overcome.

    November 11, 2008 at 10:29 pm |
  45. Glenn Glazer

    As a car salesman I think we should help the big three. First of all, right after 9/11 it seems all business stopped in America. The car industry could have shut down . It seems we were lost and in shock . I know of many other business where things just stopped , and nobody knew what to do. Then GM came out with the first round of 0% auto loans and the others followed and it kind of jump kicked our economy. And people regained the confidence and America bounced back. Now it's Americas turn to jump start the automotive industry,
    We do make good cars here in America, give them a try.

    November 11, 2008 at 10:29 pm |
  46. ilich

    I think by passing the bailouts for this companies we face more economic down turns for the near future. But lets us not be fooled by the bailouts we need more realistic solutions from our leaders, hope the democrats have the stomach for it.

    November 11, 2008 at 10:28 pm |
  47. Sean

    I disagree with the financial industry bailout; now that the gate has been open, there is a continueous line returning to the trough. As a citizen, I did not want the bailout to be passed, but who am I, just a constituent. So, it follows that I do not support the auto industry bailout – they've had 35 years to adjust to reality and they still have not learned – promoting (bragging) about cars that get 24 mpg. Big deal, I bought a Toyota Celica (a performance car) in 1974 that got 35 mpg, so shame on Toyota too.
    However, the real basis for my non-support of the industry(s) bail-out packages is based on the workings of capitalism. The industry(s), like the markets that serve them are in a correction period. Companies fail and they are replaced by stronger, more competitive start-ups, that have a tendency to re-hire the experience. It was well put by the professor from Maryland; even if he is a professor.

    November 11, 2008 at 10:28 pm |
  48. SallyKeele

    Why can't the "big three" make the same changes in their American cars that they have already made in the cars they sell in Brazil. No re-tooling necessary, already green, already very successful.

    November 11, 2008 at 10:27 pm |
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