Taxing questions about democracy in the Middle East

 
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By Khaled Diab

In the Middle East, there appears to be a link between autocracy and low taxes. Would higher taxation lead to greater representation or repression?

Tuesday 18 August 2015

The only certainties in life are death and taxes, sages, from Benjamin Franklin to Daniel Defoe, have been informing us for centuries.

In the Middle East, death is becoming an ever-more probable prospect of increasing ugliness and savagery. But taxes are a very different matter. Compared with Europe, America and other highly industrialised economies, most of the region’s taxation levels and tax revenue are very low.

The most extreme example are the petroleum-producing states. For example, Saudi Arabia’s total tax revenues account for around 5% of its GDP, while Oman’s is an even lower 2%. This is because most Gulf countries, flush with oil revenues, impose little-to-no taxation on their citizens and corporations.

Even in countries which are not rich in oil, governments impose and, more importantly, collect surprisingly little in the way of taxes compared with their Western counterparts. In Egypt, for example, tax revenue hovers at around 13-14% of GDP, even though the country possesses no sizeable natural resource wealth.

The inability or unwillingness of countries in the region to tax their citizens has far-reaching implications. Although everything from religion and the patriarchy to the deep state and corruption have been explored as causes behind the ongoing failure of the Arab revolutions, the issue of the economic bottom line has received surprisingly scarce attention.

The imposition of taxes by the state was a major factor in the emergence of democracy in Britain and Western Europe. Though it may be largely forgotten today, democratic participation was once contingent on the state’s financial dependence on its citizens. In fact, in its early days, rather than one person, one vote, the democratic system in place resembled more a Democracy Inc, with shareholders instead of equal voters.

For instance, from the 15th century, voting in England was limited to people holding land worth 40 shillings or more, and property was the defining feature of the electoral system until after World War I.

Reflecting how common the notion was that only those who could pay were allowed to play, the prominent Victorian liberal John Stuart Mill argued: “The assembly that votes the taxes, either general or local, should be elected by those who pay something towards the taxes imposed.”

In a way, this is the stage much of the Arab world is at right now, albeit informally. Through backdoors and informal channels, the wealthy and the upper-middle classes can influence the direction of the state and have their rights protected ­– at least far more so than the masses.

Today, the West lives in a more enlightened age and every citizen – whether rich or poor, male or female – possesses an equal right to vote. But the basic premise remains unchanged: the government takes money from the citizenry and so citizens have the right to choose the government and hold it to account.

If taxation is at the core of representation, does the inverse hold: that without taxation, there is no representation?

While numerous complex factors affect the level of authoritarianism in the Middle East, I’m convinced that it is no coincidence that political participation and democracy seem to be (loosely) correlated to the level of taxation.

Viewed in this light, it is unsurprising that the oil-rich states tend to be the most autocratic. This is both because the rentier state, as it is known, is not beholden to its citizens for its survival and because it can use the wealth it has accumulated to purchase influence and silence or ignore demands for reform.

Even non-petroleum countries often depend on resources other than taxes, including foreign aid, mining rights, or revenues from national assets such as the Suez Canal. This results in a situation in which governments are more concerned aabout pleasing foreign corporations and states than their own citizens.

“A basic feature of the social contract in the Arab countries is that the citizen accepts limitations on public representation and state accountability in return for state-provided benefits,” explained the Arab Human Development Report in 2009. “Such a contract is only possible when states have sources of revenue other than direct taxes, such as oil, to finance public expenditure.”

However, in the poorer Arab countries this tacit social pact has broken down, and it is teetering on the verge of collapse in the wealthier states. In fact, it would not be a stretch to say that in the poorer countries, the state plays little to no (positive) role in the lives of its underprivileged citizens.

In Egypt, for instance, the state once provided free education and healthcare of adequate standard, and attempted to guarantee full employment, at least in theory. Today, state schools are ignorance factories, state hospitals are death incubators, and with the public and private sectors in tatters, people are increasingly relying on the informal economy for employment and sustenance. That is why “bread” and “social justice” were two of the revolution’s main demands.

This raises the intriguing question of why it is that, though higher taxation is in the interests of both the state and its citizens, neither side seems terribly interested in broadening the tax base.

On the part of the government, Middle Eastern regimes do not have the authority or credibility to collect more taxes. More importantly, it appears they would generally prefer to enjoy a monopoly on power in an emaciated and failing state than to share power with citizens in a more vibrant, powerful and robust political partnership.

The motives of citizens are more complex. Naturally, taxes are unpopular almost everywhere. In the Middle East, more so. In much of the Ottoman Empire, peasants and workers were heavily taxed under a system known as Ilitizam, or “tax farming”. This double taxation had a devastating effect, such as depopulating entire villages in Egypt.

The situation did not improve with Western rule. After European lenders had helped to bankrupt Egypt during the construction of the Suez Canal, Britain formally occupied Egypt. In a 19th-century version of the Greek debt crisis, Britain handed over Egypt’s public treasury to European banks who swallowed up two-thirds of the state’s revenue.

With high taxation generally leading to no representation, not to mention a great deal of repression, persecution and corruption, it is unsurprising that the people of the region have such a cavalier attitude towards paying taxes. And native governments, with their high level of corruption, mismanagement and incompetence, have not helped raise the credibility of paying taxes in the public eye.

But there are some initial signs of change. Governments across the region are looking to increase their revenues by broadening the tax base. These efforts have mostly focused on indirect taxation, such as sales and consumption taxes, which are easier to levy and require less accountability.

However, indirect taxation is reaching its limits. Egypt, for one, has raised its low income tax level to try to shore up its deficit, especially as aid from its Gulf patrons gradually dries up. Even in the Gulf, a robust debate has begun about the need to raise tax levels to compensate for fluctuating and falling oil revenues. Additionally, it is time for the region to find a new ownership model for natural resources which boosts accountability and places control in the hands of citizens.

While governments are bound to try to impose taxation without real representation, in modern economies, this would require the kind of coercive ability no state in the region possesses. In addition, it will undoubtedly lead, like in the 19th century, to falling tax receipts, as taxpayers collapse out of exhaustion or find ever-more creative ways to evade taxation.

Although taxation alone will not bring about fair representation, manipulated cleverly by the citizenry, it will force the region’s governments to become more accountable and, eventually, more democratic.

____

Follow Khaled Diab on Twitter.

This is the extended version of an article which appeared in Haaretz on 11 August 2015.

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Circassian beauties and the ugly face of race

 
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By Khaled Diab

The curious cases of Rachel Dolezal and the Circassian ladies show just how meaningless race is, while Dylann Roof underlines the dangers of racism.

Circassian lady

Tuesday 7 July 2015

Rachel Dolezal is not the first white American woman to sport a fake Afro. A century and a half earlier, so-called “Circassian ladies” were all the rage as circus sideshows.

The bizarre phenomenon capitalised on the craze created by Johann Friedrich Blumenbach’s pseudo-scientific theories of race, which traced the roots of white people to the Caucasus, and his belief that “the purest and most beautiful whites were the Circassians”.

These whiter than white circus performers were not actually Circassian and, unlike the ideal of Circassian beauty elsewhere in the West, their hair was not of a luxuriant and smooth silky texture, but was wild and curly, an effect produced through liberal shampooing with beer.

“The hair may have been an effort to suggest blackness… a nod to popular conceptions of African female sexuality,” wrote Charles King, an expert of the Caucasus at Georgetown University.

The long shadow of slavery can also be discerned in this hybrid depiction. American audiences were both intrigued and horrified, given their false association of slavery with Africans, by the fact that Circassian women were among the most sought-after concubines in the Sultan’s harem ­– hence the need to make them appear somewhat African.

“Both African slaves and Circassian slaves were subject to sexual exploitation… and this is the point of contact that played so powerfully on white Americans’ imagination,” wrote philosophy professor Gregory Fried. Beyond America’s shores, however, slavery was a multiracial institution, and slaves could sometimes even reach the highest corridors of power, as the Mamluk warriors – slaves mostly from the Caucasus – who ruled Egypt illustrate.

The curious case of Dolezal and the Circassian ladies demonstrate just how meaningless the notion of “race” is. My five-year-old son and his friend made child’s play of the self-evidence of this truth at the beach the other day.

Though both boys are half African from the actual African continent (Egypt and Somaliland), in American racial parlance, my blond son would easily pass for “white” while his silky-haired mate looks quite “Hispanic”. In short, these two multicultural polyglots, who are still blissfully oblivious to any attempts to pigeonhole their identities, would completely confuse America’s rigid racial compass.

Official White House photo by Pete Souza. www.whitehouse.gov

Official White House photo by Pete Souza. www.whitehouse.gov

Despite the complexity and ambiguity of people’s identities, America generally prefers clarity when it comes to African-Americans. This applies even to the highest echelons of the land. Take, as an example, Barack Obama, whom it would be most accurate to describe as “mixed race”, “transracial” or “multicultural”, but is rarely referred to as such.

This compartmentalisation does not begin to capture the nuance of his multiple identities. Obama’s absent Kenyan father only gave him his name and half his genetic make-up. In contrast, his white mother, Ann Dunham (and maternal grandparents), gave him the other half of his genes but, more vitally, his upbringing. “What is best in me, I owe to her,” Obama admitted in passing in his memoir which, nonetheless, was titled Dreams From My Father.

Despite this, Obama is almost invariably described, both by admirers and bigots, as “African-American”. Though genetically he is as “white” as he is “black”, and culturally he is more the former than the latter, Obama is, as far as I’m aware, never referred to as “white”, though this is perhaps a more valid description.

For the late Ann Dunham, who did not believe in racial difference, questions of black or white mattered not a jot. However, society did not agree, and her son was labelled black from a young age, with all the discrimination that involves.

And the inability of the most powerful man in America – who is truly “transracial” – to escape racial categorisation can help us better understand the circumstances surrounding the Rachel Dolezal case.

It is easy to understand why African-Americans are offended by Dolezal’s claim of being “transracial”. She evokes painful memories of “blackface”, and the long tradition of white Americans mocking, exploiting and appropriating black culture and identity.

Though clearly an impostor and possibly unhinged, Dolezal is not the only one pedalling untruths. After all, despite the overwhelming scientific, social and cultural evidence that race is a fantasy, Americans of all political stripes still believe, in one way or another, in this fallacy.

At the core of America’s racial identity crisis lies the legacy of slavery – both for the descendants of those who benefitted and those who suffered from its crushing weight. In this light, attempts to separate racial identities are, paradoxically, important to those trying to maintain white privilege and often to those combating it.

In America, even possessing slight African heritage is enough – culturally today, legally in the past – to qualify you as black.

For instance, when I was a kid I was intrigued by how Lisa Bonet (who is of mixed African-Jewish descent) was a “black” character in the Cosby Show, even though she was paler than I was. Her one-time husband, Lenny Kravitz, who is also of a mixed African-Jewish background, was criticised early in his career for being not black nor white enough in his music.

Though race is a myth and an artificial social construct, racism is a far-reaching and bitter reality, as illustrated by Dylann Roof  and his horrendous, unprovoked cold-blooded murder of black worshippers in Charleston. “Segregation did not exist to hold back negroes. It existed to protect us from them,” claimed Roof in a manifesto he wrote. “Integration has done nothing but bring whites down to [the] level of brute animals.”

Of course, the overwhelming majority of Americans find the Charleston terror attack reprehensible and a heinous crime against peaceful worshippers and innocent citizens. However, though dangerous and deadly, it is not this form of racism that has the greatest collective impact. It is the common-or-garden, mundane, institutionalised variety that condemns millions of African-Americans to dwell disproportionately behind the actual bars of prison and the figurative bars of poverty and marginalisation.

This everyday racism in the contemporary USA needs to be challenged with as much urgency and resolve as the white supremacist, “retro” variety of yesteryear’s Confederacy.

____

Follow Khaled Diab on Twitter.

This article first appeared on Al Jazeera on 25 June 2015.

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Enslaved by history

 
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By Khaled Diab

Failing to acknowledge the legacy of slavery on all our modern societies makes the present an unnecessary slave to history.

A scene from Twelve Years a Slave.

A scene from Twelve Years a Slave.

Wednesday 13 May 2015

Like Ferguson before it, the upheavals in Baltimore have been linked by numerous historians to the legacy of slavery. Describing the United States as originally a “slave holder’s republic”,  historian Gerald Horne explained, which led to a view of Africans as “the enemies of the republic”, resonating right down to the present. “The origins of [the] urban police department lies precisely in the era of slavery. That is to say, slave patrols,” he added.

While the impact of slavery and then segregation are clear to see in the poverty, marginalisation, mass incarceration and prejudice with which African-Americans have to live, it is by no means a uniquely American experience – the whole world is struggling to deal with the legacy of one human claiming ownership of another.

Owing to its superpower status and the harsh cruelty of its particular brand of enslavement, the American experience has become the global benchmark. But the reality of slavery is far more diverse. Although Africa is the continent most bled by slavery, slaves have been of all races, nations and groups. The very word “slave” refers to the “Slavs”, who were a major source of slavery in medieval Europe.

Even in the Americas, there were some white slaves, who predated their black counterparts at a time when Africans were too expensive to be economically viable. For the British, the earliest source of slaves for their American colonies were drawn from their prototype colony, Ireland.

A white woman sold as a slave wife to an English settler in Jamestown, Virginia. Image: http://immigrationmuseum.wikispaces.com/2.+Indentured+Servants+and+Slaves

A white woman sold as a slave wife to an English settler in Jamestown, Virginia.
Image: http://immigrationmuseum.wikispaces.com/2.+Indentured+Servants+and+Slaves

England’s blood-soaked re-conquest of Ireland in the 17th century – led by theocratic dictator and Protestant Puritan Oliver Cromwell –  involved clearing vast swathes of the country of its Irish Catholic inhabitants. Many thousands of the displaced were sent to the Caribbean as slaves.

Some historians who remember this forgotten episode prefer to use the term “indentured servant” but, to my mind, this is just a euphemism for slave, since these so-called servants were “personal property, and they or their descendants could be sold or inherited”. In fact, an English adventurer of the time described these hapless Irish as “derided by the negroes, and branded with the Epithet of ‘white slaves’”.

By one of those quirks of history, this brings us to another Baltimore, this time in Ireland. In 1631, this village in Cork was sacked by Barbary pirates, whose inhabitants – mainly English settlers whose compatriots would a few years later enslave the Irish – were carried off into slavery.

European slaves in 19th-century Algiers.

European slaves in 19th-century Algiers.

Between 1530 and 1780, these Muslim pirates captured up to 1.25 million Christian Europeans, according to one estimate, causing the inhabitants of many coastal areas of Europe to flee in fear.

From our contemporary vantage point after centuries of Western global dominance, it is hard to fathom that Europeans were ever slaves. But Middle Eastern slave markets were well-stocked with them. These included, at various periods, Caucasians (i.e. from the Caucasus), Slavs, Albanians, Greeks and even Norsepeople.

However, owing to the Islamic restrictions on enslaving “people of the book”, by the 14th century, Africa was the primary source of slaves in the Middle East. Perhaps as many as 14 million Africans were carried off into slavery by Arabs/Muslims, comparable to the Transatlantic slave trade, albeit over a longer period.

Slavery in the Arab and Muslim world differed significantly from that practised in the Americas. Though, like in America, many slaves were engaged in back-breaking work in abysmal conditions, perhaps the majority were employed as servants, concubines and soldiers. In addition, freeing slaves was considered a noble act in Islam and, hence, many were liberated.

Shagaret el-Dur.

Shagaret el-Dur.

Moreover, not all were of a lowly status. A fortunate minority of slaves enjoyed a higher social status than free men and women. For instance, one of the most creative eras of my native Egypt’s history occurred under the Mamluks, slave warriors raised to rule, and the only woman to govern Egypt in the Islamic era was Shagaret el-Dur, a former slave girl. But I’m doubtful that such prestige or power compensated its holder for the early trauma of being kidnapped from their family and regarded as someone else’s property.

Though viewed more negatively, African slaves, too, could rise to high positions of influence. One example of this was the position of Kizlar Agha, the Ottoman chief eunuch and the third most influential position in the Sultan’s court.

For various complex reasons, slavery took longer to die out in the Arab world than in the West, with the countries of the Gulf not abolishing it until the mid-20th century. Despite this, the social, economic, political and cultural legacies of slavery are given very little attention in the Arab world.

The Kizlar Agha.

The Kizlar Agha.

For example, though the long and diverse history of slavery in the Arab world means that just about anyone of us could have a slave as an ancestor, the insult “abeed” (“slaves”) – which has even made it across the Atlantic – is only used to deride those of African extraction. Alongside classicism, the legacy of slavery also colours the attitudes of some Arabs towards domestic servants and migrant workers.

Few Arabs I’ve encountered ask themselves how does the history of slavery affect our relationship with the places where slaves originated and how they perceive us. Within our own societies, this legacy can lead to discrimination and can help facilitate the exploitation of bonded labourers.

Failing to acknowledge and challenge the impact of slavery on our modern societies makes the present an unnecessary slave to history.

____

Follow Khaled Diab on Twitter.

This article first appeared on Al Jazeera on 8 May 2015.

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Egypt’s centuries-old leadership vacuum

 
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By Khaled Diab

Decades of authoritarianism and centuries of non-indigenous rule have led to a shortage of effective native leaders in Egypt, derailing the revolution.

Field Marshal Tantawi: Mubarak 2.0. Photo: ©Khaled Diab

Photo: ©Khaled Diab

Thursday 25 December 2014

Hosni Mubarak, the face which launched thousands of street protests, was cleared of ordering the killing of hundreds of protesters and numerous corruption charges related to his three decades on Egypt’s republican throne were also dropped.

The news of the ex-dictator’s acquittal has hit activists and pro-revolution Egyptians like a rude kick in the groin, leading to angry protests on campuses across the country. The man who symbolized everything that was wrong with Egypt in 2011 walked scot free under the auspices of the man who presides over everything that’s wrong with Egypt in 2014: Abdel-Fattah al-Sisi.

By walking free, Mubarak – who inadvertently gave birth to the Egyptian revolution when he stepped down – may harken the revolution’s death knell, at least for the time being.

Some believe the situation is even worse. Writing in the Washington Post, Eric Trager argued that “the ‘revolution’ didn’t die… a true revolution never happened in the first place.” Trager contends that the uprising in Egypt not only failed to bring about revolutionary change, a substantial percentage of the population did not desire it, wishing only for elusive “stability”.

What his assertion overlooks is that many revolutions fail to bring about the radical change they seek, such as the 1848 Spring of Nations revolutionary wave in Europe.

Moreover, if significant opposition is a yardstick, then many of the world’s most iconic revolutions would not qualify as such, including in America and France. Besides, if history is any indication it’s far too early to call the final outcome of the Egyptian revolution, since its French predecessor took generations before it achieved its goals of “liberté, egalité, fraternité”.

Despite Trager’s assertions, it is not apathy or the longing for stability that have foiled Egypt’s revolutionary aspirations.

In my view, it is a question of leadership and its accompanying political culture. On the one hand, there is the deep state which has robustly done everything within its power not to cede power. On the other, it is the leaderless nature of the revolution, which was a strength at first because it made it impossible for the state to control, but became a liability later when strong leadership was urgently required to give the popular uprising direction.

The immediate reason for this was Hosni Mubarak’s 30-odd years of autocratic rule, which deepened the state’s grip on power while eliminating viable alternative leaderships. This followed the preceding three decades of similar dictatorial rule, in the shape of Anwar al-Sadat and Gamal Abdel-Nasser before him.

Some interpret this as a manifestation of some kind of ancient Pharaoh complex on the part of Egyptian leaders. But this reductionist interpretation fails to explain why most of the region’s leadership is likewise deluded, even though their countries were not part of the Ancient Egyptian tradition of the absolute god-king.

Personally, I think Egypt and the Arab world’s leadership crisis can best be attributed to centuries of foreign rule and domination. This had the dual effect of destroying or downgrading the indigenous cadre of leaders and putting in place a damaging leadership culture.

In Egypt’s case, before Mohamed Naguib’s rise to power in 1952, one must go back nearly two and a half millennia to find Egypt’s last native leader: Nectanebo II, who was overthrown in 342BC by a combined Greek and Persian force.

Though Alexander the Great was regarded as a liberator from Persian rule in Egypt – and even the illegitimate son of Egypt’s last pharaoh – and the Ptolemaic dynasty regarded themselves as pharaohs, the Egyptian political and social order was stacked in favor of ethnic Greeks and a Greek-speaking Egyptian elite, leading to numerous rebellions, including the “great revolt” of 205-186 BC.

In the two millennia since the death of the last Ptolemaic pharaoh, the legendary Cleopatra VII, Egypt’s fortunes have waxed and waned. Roman rule retained the relative privilege of Egyptian Greeks while adding another layer of exploitation, transforming this fertile, rich country into Rome’s grain silo.

Even when Egypt went from being a province to being an independent imperial power, these Nile-based empires were invariably foreign ones in which the locals were marginalized and largely excluded from the corridors of power. This was the case with the mighty and largely religiously tolerant Fatimid caliphate, which established glittering Cairo near ancient Memphis in the tenth century.

The Mamluk era (1250–1517) saw the novel situation of Egypt being ruled by a caste of warrior slaves. Though Egypt thrived economically and culturally, the centuries of Mamluk rule witnessed chaotic and bloody transitions of power between competing pretenders. Despite the infighting, the Mamluks agreed on one thing: though ostensibly slaves, they were the “true lords” while the supposedly freeborn native Egyptians were their serfs.

When the Ottomans conquered Egypt, they retained the Mamluks as their vassals which, like the Roman era, doubled the tax burden on the Egyptian masses, with a share going towards subsiding the ruling elite’s lavish lifestyles and a share going to Constantinople.

In the early 19th century, Egypt was purged of its Mamluks by a commander in the Ottoman Empire who wanted the country all to himself: Muhammad Ali, who had officially come to reclaim Egypt for the Sultan after Napoleon’s short-lived and disastrous occupation.

Despite being Albanian, Ali is widely regarded as being the father of modern Egypt. Wishing to create a modern state along European lines, he realised the importance of harnessing, educating and empowering (somewhat) the native Egyptian population.

Ali not only developed an advanced industrial base for the country, he also built a modern army, bureaucracy and education system where Egyptian citizens could find opportunities for mobility beyond the farming and industry to which they were previously confined.

But Ali retained the Mamluks fixation on militarism and he was obsessed with building a European-style army to carve out an empire for his dynasty. This placed a huge burden on Egypt’s peasantry in the form of high taxation and conscription.

Given the centuries of militarism of the ruling foreign elites and how the army had become one of the few means of social mobility for the native population, it is no surprise that Egypt’s first modern nationalist leader with any real authority was an army officer, Ahmed Urabi.

Urabi’s rebellion against the vassal Khedive Tawfiq, which threatened Anglo-French interests, led the British to formally occupy Egypt, though they kept the Muhammad Ali dynasty in power as clients. Following the heavy burden placed on Egypt during World War I, opposition to British rule grew massively, leading to the 1919 revolution.

The revolution succeeded in gaining only partial independence for Egypt and resulted in a liberal, democratic parliament, though one that was largely toothless due to the combined influence of the palace and the British.

The seething dissatisfaction with this arrangement led to widespread protests following World War II, but it was only the army that proved to have the clout to dislodge the king and the waning British.

But rather than hand over power to an elected parliament as the Free Officers had promised after an initial transition, the lure of power proved too irresistible. Although Egypt’s new rulers were native Egyptians, rather than dismantle the centuries of imperial legacy hobbling their fellow citizens, they kept in place many of the timeworn instruments of repression and marginalisation, despite some reforms.

Like Egypt’s various foreign rulers, the new officer elite viewed with suspicion any contenders or opponents, crushing and suppressing rivals. Hosni Mubarak went so far as not even to appoint a vice-president.

This centuries-long legacy helped lead to the leaderless revolution of 2011. This does not mean that Egypt is void of talent that can govern the country fairly and effectively. There is plenty of that. However, Egypt’s political culture does not encourage this talent to rise and there are no mechanisms for the peaceful and smooth transfer of power.

____

Follow Khaled Diab on Twitter.

This is an extended version of an article which first appeared in Haaretz on 10 December 2014.

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