Page 3 of 3

Harry Reid, Gold Member

Is our Senate leader in bed with America's worst polluter?

However, Reid seems to have thought Bingaman's reforms would go too far. Ultimately, spiking oil prices pushed mining reform off the Energy Committee's agenda, but committee spokesman Bill Wicker says that Reid played a role in delaying the bill. "He certainly did, as you would expect him to," he says. "I think it would have been a bigger story if the senator from Nevada had no role in talks on mining law." Reid's office denies that the majority leader stalled the bill and maintains that his involvement was aimed at avoiding a Republican filibuster in the Senate.

"I don't think anyone is to blame," says a Reid staffer, who expects the mining bill to resurface in this session. "This is an issue where there have been many, many attempts over the past 100 years to amend it, and it's just damn hard." He would not comment on which provisions of the bill Reid supported or disagreed with, except to say that he opposes imposing any sort of fees on existing mines on public lands. The senator thinks such mines should remain exempt from any new royalty scheme, says spokesman Jon Summers. "You've got to think twice before you change the rules in the middle of the game."

to see how changing the rules might alter the face of Western mining, I traveled to central Nevada's Cortez Mountains, a rugged chain where Barrick Gold plans to excavate 6,750 acres of public land thought to contain 250 tons of gold. The delay of mining reform has been an unquestionable boon to the project, known as the Cortez Hills mine. If the House bill had become law, the site's known reserves would generate as much as $450 million in royalties.

"They say mining brings jobs," said Carrie Dann, a wrinkled Western Shoshone elder who met me on a windy October afternoon by her trailer in Crescent Valley, a dusty town near the mine. "When you tear the whole mountain down, that's one hell of a damn job." Dann drove with me to point out the project site, located on Bureau of Land Management (blm) property. As the paved road gave way to grooved clay, we passed a wall of rocks rising some 30 stories from the valley floor. High above us, trucks appeared at the edge to dump loads of rock from Barrick's existing 900-foot pit, and sprinklers sprayed piles of ore with a cyanide solution to leach out the gold.

We climbed through piñon and juniper and stopped at a clearing beneath a string of quartzite steeples known as the White Cliffs. The Shoshone buried their dead on the mountain, and this spot had been a religious gathering place for generations, Dann explained. But such considerations are meaningless under the 1872 law, which makes it nearly impossible to block a mining claim. The Clinton administration was unable to stop a proposed gold mine just outside Yellowstone whose waste might have flowed into the national park—until it gave the owners another site worth $65 million.

The 2007 mining reform bill that got stuck in the Senate would have allowed local and state governments and American Indian tribes to petition the federal government to protect areas like the White Cliffs. Still, according to Glenn Miller, a professor of natural resources and environmental science at the University of Nevada-Reno, even under a new mining law, "it's going to be tough to stop" big mines like Cortez Hills. Dann considered the blue surveying ribbons on the surrounding trees. "It's going to be sad to see pits in here," she said. (A month later, the blm approved the mine.)

Barrick claims the new mine will be state of the art. The company says it will follow strict state rules to prevent cyanide leaks and will emit hardly any mercury. (Metal mines emit nine times more mercury than all other industries combined; eight of the United States' ten largest emitters of mercury are gold mines.) However, mines have rarely delivered on such promises, observes Miller. "Every one of them has unintended environmental problems."

Those problems often become the responsibility of the federal government when mines are tapped out or mining companies succumb to the volatile minerals market. There are some 500,000 abandoned mines across the country, and cleaning them up will cost an estimated $32 to $72 billion.

After visiting the White Cliffs, I drove to see a contaminated copper mine just outside the quaint farm town of Yerington, in western Nevada. There, Tom Dunkelman, an epa supervisor, showed me a waste pond whose polyethylene liner had cracked, leaking toxic metals into the ground and possibly the groundwater that supplies 150 families, who have stopped drinking from their taps. The company that installed the ponds, Arimetco, went bankrupt in 1997, leaving taxpayers to foot part of an environmental bill that could reach $50 million. (Meanwhile, Arimetco's former ceo now runs International Silver, Inc., which is seeking to mine 1,300 acres of federal land in California's Mojave Desert.)

"There cannot be another Yerington in Nevada," says Coyner, the administrator of the state Division of Minerals. In 1990, the state began requiring all mines to post bonds to guarantee cleanup. The 2007 mining reform bill would have imposed even stricter national bonding requirements. Yet as it stands, says Patricia Mulroy, the general manager of the Las Vegas Valley Water District, mining poses a risk not just to rural outposts like Yerington, but also to the burgeoning metropolis of Las Vegas. Its water supply could be at risk of contamination from mining on any of the more than 1,200 uranium claims staked along the Colorado River. Federal mining rules need to change, she says, not to punish miners, but to protect people who live near mines. "To begin to look at the law and ask, 'How does it function in a Western setting with far more cities, with much greater stress on water supplies?' I think, is highly appropriate."

Reid doesn't seem to share her sense of urgency. When the House Committee on Natural Resources tried to revoke the uranium claims last year, Reid stood by as the Bush administration blocked the move.


back in searchlight, the prospectors, rock gatherers, and goldbugs still eagerly await the next boom. Inside the Nugget casino, the bartender told me she moonlighted as an assayer. Bob Shawn, a round man with a ponytail and walrus mustache, overheard us. "There's 28 different kinds of ore here," he said, pulling out a rock he'd dug up. "If you go under the light, you can see the gold in it. Just lick it!" Shawn's weekend prospecting had yet to make him rich, but, he mused, "Somewhere around here, there has got to be a nice vein of gold."

Behind the cash register of the Rebel Oil convenience store, I found Barnes Miller, the town's preeminent mineralogist. On a brown paper bag used to sheathe beers, he drew pictures of gold formations—lenticular, parallel—that he thought Searchlight's early miners might have missed. "I found—well, I can't get into that," he began, between mouthfuls of sunflower seeds. "The potential for the entire district is really good. There is just so much left over. It's just been forgotten."

Until the next gold rush, Searchlight struggles to reinvent itself. A whorehouse is now a senior center. Near the lot where Reid's childhood home once stood, a billboard advertises a casino. A subdivision for snowbirds that recently went up along Harry Reid Road sits largely vacant. It's hard not to wonder what might have happened if more than a century of mining royalties had helped fund parks and sidewalks.

Reid still entertains the notion that his hometown—and perhaps his entire state—might defy the odds and strike it rich once again. "A mining town is like the ocean," he wrote in Searchlight: The Camp That Didn't Fail. "It has tides that sweep in and tides that go out, the ebb and flow of nature. Those in the ebb are sometimes unable to see the flow. But in mining it is always there." (Asked if Reid might someday reopen his mines, a spokesman says, "To Senator Reid's knowledge, there's no valuable mineral deposit on any of the land that he owns.")

Yet Nevada's gold is running out; its known reserves are expected to last only 20 more years. After years of being called the state's second-biggest business (after gambling), the mining industry, perhaps assuming a lower profile, now insists it's the sixteenth. But that doesn't change the fact that the difficult, dirty business of mining remains dominated not by plucky gold panners, but by behemoths like Barrick.

"Small-time mining is over, in my opinion," said Tony Werly, owner of the shuttered Techatticup mine, where Reid's father worked as a watchman in his twilight years. Werly makes his money leading tours of the mine and renting the site to Hollywood directors. (In the 2001 stinker 3000 Miles to Graceland, Kevin Costner flicks a cigarette into a puddle of gas by the mine, blowing up an airplane.)

Jane Overy, who moved to Searchlight in 1980, operated one of the last gold mines in the area, only to shut it down after two years. She believes mining in Searchlight is a distant dream. "This is not nugget country," she explained.

Now the town's historian, Overy keeps a photo of Reid on the wall of her small community museum. Still, she doesn't see eye to eye with the senator on the question of who profits from mining public lands. "This probably is not going to sit well with Harry, but I was surprised coming here that we didn't have to pay for any minerals from the ground. As a citizen, that really bothered me," Overy said. "The gold belongs to the people."

Page 3 of 3

Josh Harkinson is a staff reporter at Mother Jones. For more of his stories, click here.

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Comments

Mining Legacy

Obviously, mining is necessary. However, because of legislators like Reid, the mining companies have not had to use the best environmental practices. The worse case scenario is on Native American lands that have continually been devastated by the greed of mining companies--please check out www.mining-law-reform.info/WhyNow.htm These sovereign nations do not own their land--it's owned by the U.S. government. You know what that means! And thank you for printing this informative piece on this devastating reality.

Gold and Harry Reid

Your story relies on an ill-informed mine employee, a misrepresentation of Nevada’s regulatory approach to mining and unsubstantiated innuendo to reach what appear to be a series of foregone conclusions about mining in Nevada and Senator Reid. All mines in Nevada must comply with a wide-ranging set of laws and regulations that are enforced by local, state and federal governments. These include laws that protect water, air and wildlife resources, promote workplace safety and require mined land to be restored to another useful purpose after mining has ceased. Nevada has been diligent in enforcing its laws and regulations and, contrary to the claims of your miner friend, mining does occur in California, Arizona, Montana and Washington. You need only check the public records to verify. Further, your use of EPA’s Toxic Release Inventory reports to characterize mining as “America’s worst polluter” is equally wrong. U.S. metals mines nationwide contribute less than 0.5 percent of the total emissions released to the air and water that are reported each year under the TRI program. A further check of the record would have revealed that the mining industry for more than a decade has supported modernization of the Mining Law—including provisions that would provide a greater financial return to the federal government for use of federal lands. Nevada’s mining jobs are high-paying—76 percent higher than the average wage in the state. In 2007, Nevada mining provided more than 22,000 jobs statewide and generated more than $8 billion in economic activity. With millions of American’s struggling because of the recession and with Nevada particularly hard hit, one need not look for more sinister reasons behind Senator Reid’s desire to keep good-paying jobs here at home. Carol Raulston Senior Vice President, Communications National Mining Association Washington, D.C.

Gold and Harry Reid

Carol, Thanks for your response to our story. It's unfortunate that you feel that it is full of unsubstantiated innuendo. Quite to the contrary, every fact in the piece has been checked and re-checked for accuracy. The miner quoted in the story was not saying that mining is illegal in other states; he was saying that regulations in many other states are so onerous that they in effect prevent mining. In the case of Montana, for example, cyanide mining has been outlawed, which effectively prevents gold extraction. I'm curious about your basis for claiming that U.S. metal mines contribute less than .5 percent of total emissions released to the air. Does your particular definition of "emissions" include hot air coming out of people's mouths? The TRI very clearly states that Metal Mining (TRI code #2122) released 1,260,743,002 pounds of chemicals in 2006, the most recent year for which data is available. The next-largest emitter is Electric Utilities, which released 1,022,258,694 pounds of chemicals. Anyone who wishes to go to the source for this data can access this TRI page: http://www.epa.gov/triexplorer/industry.htm and click on the button that says "generate report." Under the heading that says "Total On- and Off-Site Disposal and Other Releases" click on the up arrow to sort the industries based on largest-to-smallest emitters. Metals Mining tops the list. I do not doubt that the mining industry supports reforming the mining law and will agree to a royalty. But how much of a royalty? Is it the case that the industry could simply deduct the modest net royalty that is already pays in Nevada from the nearly identical federal net royalty that it is proposing? Do you support the much more significant royalty on gross revenues, which is the global industry standard? Readers would be better served if you could engage them in a discussion in this space about what provisions of royalty reform you oppose, and why. I welcome your response.

"hot air coming out of

"hot air coming out of people's mouths?" Snap!

Culture of Perks

At some point, people pressed against the wall are going to burst through the wall that holds them at bay--the wall of long-inculcated misinformation about the content of America's populace and the people who, elected to represent them, no longer represent them. We have moved on in the political world. We are no longer a nation of citizens . . . we are a nation of consumers. The recent queue of R Govenors who lined up to parrot refusal of stimulus money that 80% plus of their folks back home sorely, desparately need is the latest in the theatre that contorts an illogical uber-bafflement upon all of us watching. Our pundits are smirking with a befuddled disdain, and end up summing up their inability to offer cogent decypherment re stimulus stiff-arming by saying "crazy . . . it is just crazy." When the last congressional election was held, before Obama's election, and a fresh flush of new Democrats arrived with bluster, only to disappoint all those who were watching and were left wondering . . . er . . . what is up with that? Why are the new voices, if heard at all, sounding so fawning and somehow mostly Right Wing Republican? Republican and Democratic elected officials no longer represent their constituents back home--they now all pay bi-partisan homage to their new masters--American and Global corporations. The hero of all miners in America--John L. Lewis--must be rolling over in his grave, watching the quick-step imp Reid dancing about, passing his wand from hand to hand, hoping to obfuscate the issue from the people who put him in power. Oh, well. We cannot thank John L. Lewis enough for his part in creating the middle class in this country. But we might want to beg his forgiveness in allowing the middle class and labor to be so savaged by a populace who simply did not have the time to sit back and remember, being so busy swallowing misinformation from the megaphones of corporate-speak--television's epic trivializations of American worth. I myself beg Lewis' forgiveness for the current plan to take it all back; both Lewis and I know that these sloe-eyed lotte fop Democrats like Kerry and Reid are nothing like the Democrats who took a head-banging and more just to be heard, let alone established as a decent wage-earning middle class. If and when we allow the elephant in the room to be acknowledged, we shall begin to save America from the pirates of industry. Until then, dance on, Mr. Reid, dance on.

Correction needed

Yerington is not in eastern Nevada. More correctly it should be western or northern Nevada.

re: Correction needed

Thanks, Anon. The story has been corrected.

Gold mining is absurd

tagged as: 
it is absurd to me that any country that keeps gold reserves would simultaneously be destroying it's environment to let a foreign company get at all of it's natural reserves. In it's Nevada operations alone, Barrick's mines used 6,559,165,136 gallons of water and 29,653 tons of cyanide last year, exceeded air permits 15 times, and had chemical spills (as in accidents) totalling 2,960,804 gallons (according to their won reporting). *http://barrick.com/CorporateResponsibility/Reporting/PerformanceTables/Environment/default.aspx

Get Real Harkinson

tagged as: 
Get Real Josh Harkinson’s article “Gold Member” page 55-59 of the March/April 2009 for the most part is trash. The General Mining Law of 1872 is not the “free ride” Harkinson claims it to be. Maybe he should have done more investigation into the policies of the BLM and the NFS on the policies of claiming land. Federal statute limits their size to a maximum of 1,500 feet in length along the vein or lode. Their width is a maximum of 600 feet, 300 feet on either side of the centerline of the vein or lode. The person/interest making the claim does not own the land in the majority of instances and is required to pay fees for such. Top Ten Problems with H.R. 699 Demonstrate Why this Bill is Bad for America Representative Nick J Rahall introduced H.R. 699, “The Hardrock Mining and Reclamation Act of 2009,” on January 27, 2009. The sweeping changes in this bill are disaster in the making for the domestic mining industry and for America. H.R. 699 creates many uncertainties for the mining industry. But one thing is certain – this bill will create the following serious problems for the Nation if it becomes law: • America’s national and economic security will be severely weakened as high paying family-wage jobs are exported and our Nation becomes more reliant on foreign sources of strategic and critical minerals; • Mineral production on America’s public lands will be severely curtailed; • America’s already extensive reliance on foreign sources of minerals will dramatically increase due to the significant reduction in domestic mineral production; • Mining-dependent rural communities will experience severe economic hardships; • The federal government will be subject to substantial takings litigation. The following are the 10 top reasons why H.R. 699 is bad for America: 1. Decimates security of land tenure by eliminating the rights to use and occupy public land for mineral purposes which will thwart exploration and development. • Eliminating pre-discovery rights to enter, use and occupy public lands open to mineral entry creates intolerable uncertainty because exploration becomes a discretionary use of public land where permission to explore can be revoked at any stage. This loss of pre-discovery rights significantly increases the risks associated with mineral exploration and will lead to a substantial decline in mineral discoveries and future mineral production. • Eliminating the right to use and occupy non-mineral public lands for ancillary facilities such as processing facilities, unmineralized rock storage areas, roads, etc., and making these uses discretionary, also creates intolerable uncertainties which will thwart mine development. • Before substantial investments will be made to explore and develop mineral deposits, miners must know that their rights to enter, use and occupy public lands open to mineral entry are secure from entry through mine closure. 2. Confiscates investments by empowering the Secretaries of Interior and Agriculture with discretionary authority to deny permits to projects that otherwise comply with all environmental laws and regulations. • This creates significant uncertainty about ultimate project approval, making it more difficult to attract investment capital. • The discretionary authority in H.R. 699 replicates the mine veto provision in the 2000 Bureau of Land Management regulations that were withdrawn in 2001 because they conflict with the policy goals in FLPMA and BLM’s NEPA analysis concluded that such authority would result in “significant adverse effect to mining-dependent communities, including declines in social well-being due to potential for up to 75% decrease in some types of mining.” 3. Creates a new unrealistic and unworkable definition, “undue degradation,” that changes the current FLPMA standard of “unnecessary or undue degradation,” which recognizes that some degradation may be necessary (i.e., unavoidable) in order to mine. • This undue degradation definition singles out hardrock mining compared to all other activities on public lands by imposing a higher, impractical, and unfair standard that precludes unavoidable degradation due to mining. 4 Empowers states, political sub-divisions, and Indian tribes to petition to withdraw public land from mineral entry, even after valuable minerals have been discovered. • Requires granting the withdrawal petition unless the Secretary finds it is against the national interest to grant the petition, an almost impossible criterion to meet on a mine-by-mine basis. 5. Withdraws massive amounts of public land from mineral development without considering the mineral potential of these lands or their importance to meeting domestic needs for minerals. • Putting potentially mineralized lands off-limits to mining will increase the Nation’s reliance on foreign minerals. 6. Imposes a 4% gross royalty on existing operations with commercial production and an 8% gross royalty on all other claims, subjecting the Unites States to significant takings litigation. • Assessing the royalty on existing mining claims on which there has been substantial investment in reliance on existing law may subject the United States to substantial takings litigation. • The United States Supreme Court has ruled that valid unpatented mining claims are exclusive possessory interests in federal land for mining purposes which entitle claim holders to extract and sell minerals “without paying any royalty to the United States as owner.” Union Oil Co. v Smith, 249 U.S. 337, 348-349 (1919). 7. Contains a new, duplicative and unnecessary public review process and impractical, ambiguous, and unworkable environmental standards. • These changes are not needed or desirable. The current NEPA process and federal and state environmental standards are working well according to the 1999 National Research Counsel study which concluded that the existing federal and state regulatory schemes for hardrock mining were effective in protecting the environment. 8. Places arbitrary time limits on mines by eliminating life-of-mine permits. • One maximum twenty year permit with the uncertain possibility of one twenty year renewal creates too much uncertainty making it difficult to attract the investment capital needed to build new mines and will cause premature mine closures, leaving minerals in the ground, wasting mineral resources and hurt local and state economies that depend on mining. 9. Eliminates notices for exploration, failing to recognize exploration’s limited surface disturbance and places an unrealistic ten year maximum on an exploration permit. • The resulting downturn in exploration will lead to a dramatic decline in discoveries of new mineral deposits and will significantly reduce future domestic mineral production. 10. Contains unnecessary and harsh enforcement mechanisms that treat miners like scofflaws. • The severe criminal penalties for permit violations are unfair, unprecedented, and inappropriate for most situations and launches a vendetta against America’s miners.

Flooded With Foreign Goods, U.S. Needs a VAT

Flooded With Foreign Goods, U.S. Needs a VAT Foreign governments collected $122.4 billion from U.S. producers in 2006; foreign producers collected $218.2 billion in rebates during that same year. Our tax structure prevents us from competing globally and must be immediately changed. Published 03/07/09 Craig Harrington http://www.economyincrisis.org/articles/show/2523 Editor's note: This article first ran February 27, 2009. It is just as relevant today. Editor's Note: Our self defeating tax structure, compared to all of our foreign competing countries, places us in a most disadvantageous position. Foreign governments collected $122.4 billion from U.S. producers in 2006; foreign producers collected $218.2 billion in rebates during that same year. Our tax structure prevents us from competing globally and must be immediately changed. The fact that the United States is dependent on imports goes without question. It is a truth that is merely taken for granted. Unfortunately most people do not understand what drives this imbalance. Many assume that American companies are not good enough; or worse yet, they assume that Americans just don’t work hard enough. The real reason is cleaner cut; our companies cannot compete with foreign pricing. We cannot price compete because our government does not protect our producers the way foreign countries do. Our competitor countries have better tax systems and better approaches to international markets than the United States. The best comparison to the United States is Europe. We cannot price compete with China, India, Mexico, etc., because their living standards and wages are so incredibly low. Europe industrialized long before the U.S., and has comparable creature comforts, technology, wages, social structures and laws. In the European Union the biggest thing propping up their producers is the Value Added Tax system. Every EU member must adopt the VAT before they are admitted into the community. Every nation must put additional taxation on the component assembly of manufactured goods. This raises money for the government – which collects the tax – but is also raises the cost for the producer. As a means of offsetting this cost the government refunds the tax at the end of the year. Why tax if it will just be refunded at the end of the year anyway? Would it not be easier to just leave out the tax, keep the costs down and bolster production? The VAT makes goods more expensive when purchased domestically, but that cost is taken on by the consumer. As a means of keeping consumers away from cheap foreign substitutes the government also puts a VAT on imports as well. In Germany the VAT is 19 percent – the highest tax rate in the EU is 25 percent. Any importer to Germany must pay 19 percent extra just to get its item into the market. This was put in place in the EU, and allowed by the WTO, as a means of ensuring “fairness” in the market. What it really does is block foreign competition. Mercedes gets 19 percent of the cost refunded on a $40,000 vehicle that is sold in the United States, or anywhere else. Cadillac meanwhile, would have to charge $47,600 for an equally valued vehicle to be sold in Germany. In the United States our wage regulations guarantee that something “Made in America” probably costs more than a foreign substitute. This same problem is experienced in Europe, but they dealt with the problem by instituting a VAT system which effectively protects home-grown industry. Consumers accept the fact that retail prices are slighting higher than necessary, because the trade off is worth it. In exchange for paying higher prices the people are able to encourage domestic manufacturers, maintain a stable job market, stamp out trade imbalances, and ensure long-term growth. In the United States the insatiable desire to buy the cheapest possible product has resulted in our country being supplied from overseas. We send hundreds of billions of dollars overseas every year on foreign purchases; money that could be used to spur growth in our own country. We outsource our production and lay off workers to keep costs down. The government continually cuts taxes and drops tariffs in its pursuit of "free trade.” The end result has been a massive wave of layoffs, an indebted consumer, an indebted government, and a gutted manufacturing sector. The United States needs to institute its own VAT to bolster American manufacturers, wean Americans off their addiction to foreign products, and stabilize our collapsing economy. The government could even invest some of the money it collects from the VAT and use the gains to refund the next year’s VAT receipts, or pay down the $11 trillion national debt. We can take action now, or watch our economy siphoned off until nothing remains. =-=-=-=-=-=-=-=-=-=-= Foreign ownership refers to ownership of assets of a particular industry by foreign controlled domestic U.S. Corporations (FDC) 50% or more owned by a foreign entity. Percentage Foreign Owned: Metal ore mining - 65% Coal mining - 48% Nonmetallic mineral mining and quarrying - 47% More info: http://www.economyincrisis.org/content/ownership

Harry's in bed with the good ol boys!

I know that the actual workers of these mines have to work doing what they know. They have to feed their families. Pay for health care and survive like the rest of us. I have no beef with the minors and the mining industry. These hard workers are the back bone of this country. However? I have come to believe that the whole nation is a big ponzy scheme. All of the people who know how to cover their chicken tracks have pals doing the same in all levels of govt. And that is a possible way they get away with what I like to call, their form of embezzlement. It's legal as long as it's them doing it! Just like in that new movie Frost Nixon? Where Nixon says "It's NOT illegal if the President does it"!! No kidding! Nobody is going to tell me that a senator from one of the most notorious states for crooked officials Ill. state government Mr. Obama now our President is also "not in bed with Harry!" I have never seen any candidate for United States President make that many if any stops in ELKO NEVADA!! The hard working people in Elko are no different than the rest of the hard working people of all of Nevada in any industry. But the politics is also just as dirty as the crap they have in Ill.

Wrong Direction

It looks like Josh doesn't know how to read a map. The Clarks Fork of the Yelowstone River flows away from Yelowstone National Park, not toward it. Josh also didn't eeducate himself as to the very strict mining regulations (environmental) imposed on mining companies in Nevada by the County, State, and Federal Governments. The writer would be more credible if he had done his research and stated the facts rather than his agenda.

It is not hard to find

It is not hard to find information on Harry's past dishonesty ...

this guy is not honest at all

this guy is not honest at all

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