Facebook to alter its news feed sharing algorithms

Facebook is said to be rolling out changes to how content is selected for each of us to see in our news feed. FB will show us content that their algorithms believe is user generated (versus that from publishers), and which has been shared, liked or commented upon. Other posts will apparently see lower priority and less visibility, meaning, they sort of disappear.

Facebook says this should result in seeing more personal posts from actual FB friends. FB is trying to discourage “passive” reading of posts and wants to push people to interact more. I suspect they are pushing towards interaction because passive reading provides them no data on your interests. By leading you to click Like, Share or Comment, they can detect your interests which they use to refine their dossier on each of us, to improve the marketing of products and services to us.

Source: ‘We’re losing hope’: Facebook tells publishers big change is coming to News Feed – Digiday

Twitter supported “net neutrality” while simultaneously shadow banning political views on Twitter

Then: Twitter and others warn FCC of ‘disastrous’ net neutrality reversal

“Disastrously, the Federal Communications Commission (FCC) last week released a draft order that would end this open commerce by repealing the current net neutrality rules and eliminating the protections that keep the internet free and open for America’s businesses and consumers”

Today: Twitter “shadow bans” those posting political viewpoints that Twitter does not like

A “shadow ban” means posts are visible only to the poster and no one else. By seeing their own posts, the poster is not aware they have been censored. This technique was developed to impede spammers. The spammer would post an advertisement/link in a comment – and the spammer would see their own spam appear online, unaware that the post was invisible to everyone else. It might be weeks or months before the spammer caught on. The shadow ban effectively stalled the spammer from achieving their goals.

In effect, a shadow ban is a secret censorship program. Twitter staff have been caught on camera admitting to applying shadow bans to political speech. They also admit to taking down accounts under government pressure.

It is inevitable now that social media will be subject to regulation. Twitter is on shaky ground – if they are acting as editors, then they can be held responsible for the content posted by their users. They no longer have a safe harbor that they are merely a carrier of communications, like a telephone company.

This blog was shadow banned by Facebook a year ago, almost certainly because their algorithms incorrectly identified the few automated posts originating on the then self hosted WordPress blog, as spam. I could manually post the items on FB, and after switching to a WordPress.com hosted blog, the automated posts continue to go through.

In the fall of 2018, I posted factual price quotes from HealthCare.gov as a comment to an Oregonian article on the ACA – my comment was shadow banned. We no longer read The Oregonian’s fake news.

Will virtual reality lead to more effective propaganda?

By “effective” we mean, propaganda that is more successful at persuading someone to adopt someone else’s agenda:

“What really makes people trust VR more is that it creates a greater sense of realism compared to text and that creates the trustworthiness,” said Sundar.

….

That said, the immersive quality of virtual reality and 360-degree video may make the content more shareable, according to the researchers, who report their findings in the current issue of Cyberpsychology, Behavior and Social Networking.

Source: Virtual reality makes journalism immersive, realism makes it credible — ScienceDaily

VR appears to strengthen two key attributes of propaganda messaging:

  1. The VR experience enhances credibility of the propaganda message
  2. VR content may be “more shareable” than other content.

In other words, people are less likely to question the propaganda and are more likely to share it – further enhancing social media’s role as a frictionless platform for propaganda messaging.

Are we doomed? 🙂

Fitness trackers do not improve health; Plan B is to manipulate users via social media peer pressure #FitnessTrackers

This is a standard propaganda technique – “Get on the Bandwagon”, which uses peer pressure to encourage you to adopt someone else’s agenda:

The first is leveraging social networks to stoke competition or foster support. Researchers led by Penn State psychologist Liza Rovniak recently showed support networks to be highly effective at increasing physical activity in unmotivated adults, but Patel suspects the leaderboard format, a popular way of promoting competition by ranking users, fails to inspire anyone but those people at the top of the charts (who probably need the least encouragement anyway).

Source: Science Says Fitness Trackers Don’t Work. Wear One Anyway | WIRED

Even though fitness trackers do not work to change behavior over time, many employers now give away free fitness trackers in exchange for employer sponsored health insurance discounts.

Note

This only applies to employer-sponsored health insurance. In the individual market, the ACA prohibits giving discounts to individuals who engage in any healthy behaviors other than not smoking. The ACA turned the health insurance market place into a variant of apartheid.

Much news reporting is pure speculation, not actual reporting

I ran across a link to an old CNN Money financial news report from October 24, 2016. Every speculation made in this news report was wrong and illustrates how much “news” is not really reporting on events but is speculation about the future.

One week before the 2016 Presidential election, CNN Money’s report is titled

Key points:

  • If Donald Trump wins, U.S. stocks – and likely world markets – will “almost certainly tank”
  • “A Trump victory would be “America’s Brexit.” It would shock U.S. and global markets, much like the surprise, June referendum in the U.K.”
  • “Almost everyone on Wall Street currently predicts Hillary Clinton will win”
  • “A Trump triumph would likely cause investors to flee stocks to the safety of gold and bonds”.
  • “the market is already pricing in a Clinton win”
  • Voters like a split government but “there’s a growing fear that the Senate — and even the House — could flip [to Democrats] if voters come out strongly for Democrats.”
  • There is a 71% chance Democrats retake the Senate
  • “All the ‘market metrics’ point to a Clinton victory

All of the key points were speculation and were wrong.

Do watch the CNN video at the link and do watch the reporter’s body language. (The reporter no longer works for CNN. She now works for the Washington Post.)

Impact on Social Media and Propaganda

These news reports are entertainment stories designed to occupy your time while pretending to inform you.

These stories become the basis for social media conversations as they are Shared, Liked and Commented on via Twitter and Facebook.

These stories whip some into emotional outrage. In reality these stories waste our time – we are not better off for having watched or read a story that ended up being 100% wrong. In fact, we may be worse off.

Speculative Stories Are Easily Spun into High Emotional Impact Stories

Large numbers of news reports are pure speculation about the future; none are ever a scorecard of whether past speculation proved true or false. Speculative stories are entertainment to fill a 24 x 7 news cycle, to keep our eyes glued for the delivery of advertising messages. Reporters can find an authority (“Appeal to authority”) to find any quote they want. Speculative stories are easily spun into high emotion grabbing content, which is perfect for Sharing – or merely to lull our brains into being more susceptible to advertisements.

Bottom line: Learn to recognize speculative news reports and do not take them seriously. Learn to think for yourself and question whether someone is spinning a story to persuade you of something. Avoid sharing speculation on social media – all that does is amplify that you’ve wasted your time and think your friends should waste their time too.

Disclaimer – The U.S. is so polarized that I am required to post a disclaimer: reminder, I did not vote for Trump and the above comments are not pro- or anti-Trump but are a comment about the use of speculation as an editorial technique to inflame our emotions and engage us into social media propaganda sharing.

Supporting Data

Continue reading

Polar bears, social media, and how our emotional response may have helped a PR stunt

(This item – featuring a polar bear – emotionally hooked many people – and for some, any discussion is controversial. However, this post is not about polar bears or climate change but about successful propaganda messaging.)

Here is the original dying polar bear photo and post from photographer Paul Nicklen. Read carefully. He – and his associate – never say this polar bear is dying due to climate change but he does link climate change to polar bear habitat and asks readers to join Sea Legacy (of which he is the founder). His co-photographer Cristina Mittermeier acknowledged they had no way to know the cause of this bear’s starvation. At time of this blog post, her photo had received over 1 million likes just on Instagram. Nicklen has nearly 4 million followers of his own on Instagram.

The photos – and video – use the method of emotional engagement to capture the viewer’s quick acting System 1 thinking style. There is no question that this polar bear is starving and its life is endangered.

Again, per Mittermeier, they acknowledge they had no way of knowing the cause of this bear’s starvation.

National Geographic (for whom Nicklen has worked as a photographer), without evidence, links this bear and this photo to climate change.

Many media outlets picked up the story – emotional stories engage readers and viewers and tacked on the claim that the bear was dying due to climate change.

The photographers said, In the end, I did the only thing I could: I used my camera to make sure we would be able to share this tragedy with the world.”

The photo and videos were taken in August and published on December 5th, days before a global climate change conference in France.

Literally millions, if not tens of millions of people, saw this photo in media reports and shared posts on social media.

In the week that followed, we learned more:

Ultimately we learned that all of us were led, through a likely propaganda campaign, heavily reinforced on social media, to believe something that was not supported by evidence.

As the Toronto Sun notes, this photographer used similar photos in the past as PR for his group Sea Legacy. In this case, the photo was released months after it was taken, but days before a 50 nation climate summit in France.

Sea Legacy responded to some of the criticisms suggesting that the Inuit want to profit from polar bear hunting.

Higdon responded (and also noted that Inuit earn little from this activity):

The irony is that Sea Legacy is itself using this as a fundraiser while saying the Inuits’ interest is just money. Sea Legacy encouraged readers to join Sea Legacy and also provides licensing information for use of the video.

From a PR standpoint, this was an overwhelmingly success propaganda campaign. This story consumed social media Likes and Shares for days.

This campaign successfully delivered the message that polar bears are starving to death because of climate change – and you could make a difference by contributing to the Sea Legacy organization.

How it Worked

The photo tugs at our emotions and quickly puts our brain into an emotional response, rather than a rational response. Pre-propaganda campaigns have already established  images of polar bears as the sign of climate change; before climate change, we called it “global warming”, hence, a connection to Arctic ice.

The photographers added commentary, saying we found a starving bear, experts say climate change will cause melting ice and will lead to food shortages for bears … leaving the conclusion to the viewer –> this bear’s death is due to climate change. Much of the professional media took the bait – and immediately drew that conclusion in their reporting. This method of using a sequence of true statements to direct the target to a false conclusion is common in propaganda. See The most spectacular example of social media propaganda – so far! for another example of this method.

The message was distorted at best and possibly wrong at worst as no supporting evidence was provided as to the cause of starvation. Some suggested that Sea Legacy had a duty (because the polar bear is a protected species) to notify the Canadian government who likely would have euthanized the bear and performed a necropsy to learn more.

Bottom Line

As always, in propaganda messaging, the first message is the one that sticks, even when subsequently shown as false. We can be sure that millions of people got the messages: polar bears are already dying due to starvation caused by climate change. Young children in schools are likely brought to tears by these images and this message will stick with them perhaps for life.

In the end, this is not a story about polar bears or climate change – but a story about propaganda methods. The evidence that this was a PR stunt is greater than the evidence provided that this bear’s death is due to climate change.

This is possibly one of the most successful propaganda messaging campaigns of the modern era. Although as more people learn they were taken for a ride on this PR stunt express, this could cause long term harm to other environmental organizations attempting to legitimately raise awareness of serious issues, as we all tune out “yet another PR stunt”.

Note – This post is not about polar bears or climate change but about how a successful social media meme appears to have been launched in the media and social media days before a major international climate conference. Clearly, the pictured polar bear is starving. I have linked to respected and relevant sources (BBC, CBC, Polar Bear International’s Chief Scientist, National Post, Slate Magazine, Dr. Higdon, Andy Revkin and others) that question the accuracy of the messaging. This story, as noted by many (see links) has the appearance of a successful propaganda messaging campaign. This post makes no assertion as to the health of polar bear populations, the certainty or uncertainty of climate change or the future – and should not be interpreted as supporting or not supporting any position on those topics.)

Full text of the comment that was shadow banned by @Oregonian newspaper

The next morning, my comment remains shadow banned by the Oregonian.

Here is the description of the shadow ban, from last night with a screen capture of how the ban appears.

Here, I present the full text of the shadow banned comment plus the supplementary information for how I obtained the facts presented in the comment.

Here are actual price quotes from HealthCare.gov.

The first quotes are for a 64 year old married couple earning pre-tax income of $65,000 per year, which is above the subsidy cut off level, hence, no subsidies. These quotes are for the least cost benchmark Silver plan.

Asheville, NC – $34,344 per year + $14,000 deductible
Baker City, OR and Burns, OR – $28,344 + $5,000 deductible
Birmingham, AL – $30,732 + $10,000 deductible
Bozeman, MT – $38,956 + $11,400 deductible
Breckenridge, CO – $29,099 + $9,000 deductible
Charlottesville, VA – $56,998 + $9,000 deductible
Flagstaff, AZ – Flagstaff, AZ – $34,824 + $8,000 deductible (this is LESS than last year’s $36,000)
Homer, AK – $40,320 + $9,000 deductible (LESS than last year’s $48,000)
Laramie, WY – $49,164 + $5,000 deductible
Medway, ME – $$34,571 + $6,7000 deductible

Here are some quotes for a family of 5, a married 53 year old couple with 3 dependents age 21, 18 and 15.

Charlottesville, VA – $64,836 + $9,200 deductible
Laramie, WY – $55,943 + $5,000 deductible
Winnemucca, NV – $34,903 + $13,600 deductible

Some may be surprised that a person earning $65,000 per year may have $30,000 to $55,000 per year in insurance premiums – and not receive a subsidy. This occurs because the ACA determines the subsidy cut off level by the regional poverty income level – it has nothing to do with the insurance premiums actually paid in the market. Consequently, the married couples in Charlottesville VA and Laramie WY are told to spend more than their after tax income on health insurance + deductible.

Note – rates are nearly flat from age 21 to age 40. At age 43, rate curves turn sharply upward and rise extremely rapidly.

The ACA and the IRS define “Coverage considered unaffordable” as the least cost Bronze plan costing more than 8.13% of your modified adjusted gross income. To illustrate, if your family’s least cost bronze premium were $8,130 per year, if you earn less than $100,000 you are exempt from the individual mandate.

Using a real example, the married 64 year old couple in Baker City or Burns OR is exempt if they earn less than $348,634 per year in income.

Actual rate quotes from across the country show that by the ACA’s own definitions, many families in their 30s, most families in their 40s, and essentially everyone over 50 is exempt from the individual mandate at this time rendering political arguments over the mandate as entirely moot. The ACA itself has already repealed the mandate. (And it doesn’t matter, as the Frean/Gruber paper published in the New England Journal of Medicine, in October 2016, found that the individual mandate has had no discernible impact on sign ups. For those that don’t know, Jonathan Gruber was considered the co-architect of the ACA as its design is based on his 20+ years of health policy research.)

Sadly, we have not seen the above information in many news articles as coverage has been woefully inadequate, primarily covering benefits and rarely to never discussing actual problems and how they might realistically be resolved.

Supplementary Information

All price quotes are from the U.S. government run web site healthcare.gov.

The following information was used in obtaining the price quotes.

  • Family 1 – a 64 year old married couple
  • Family 2 – a 53 year old married couple with 3 dependents, age 21, 18, 15.

Zip Codes Used at HealthCare.gov

(Copy of the notes file I maintained while looking up this information in November 2017).

Asheboro, NC 27203 (note png says Asheville due to typo)
Baker City, OR 97814
Burns OR 97720
Bozeman MT 59715
Flagstaff AZ 86001
Hillsboro 97124
Homer AK 99603
Klamath Falls OR 97601, 52, 52, 21, 18, 15 age of dependents, income $116,000/year
Laramie WY 8207
Cheyenne, WY 82007
Reno 89502
Grand Junction CO 81506, http://connectforhealthco.com/
Santa Fe, NM 87501
Woodinville WA 98072, https://www.wahealthplanfinder.org/
Winnemucca NV 89445
Bandon OR 97411
Boise, 83704, Birthdate 03/01/1954, https://www.yourhealthidaho.org/

https://www.healthcare.gov/see-plans/#/

2018 Data from healthcare.gov or state web sites
Boise, 83704, Birthdate 03/01/1954
https://www.yourhealthidaho.org/

Additional Reference Information

Yes, I really do log what I do, in great detail.

Frean, B., Gruber, J., Sommers, B. (2016). “Disentangling the ACA’s coverage effects – lessons for policymakers”.  N Engl J Med 2016; 375:1605-1608 October 27, 2016 DOI: 10.1056/NEJMp1609016 Retrieved from: http://www.nejm.org/doi/full/10.1056/NEJMp1609016#t=article

IRS. (2017). IRS Form 8965 Instructions. Retrieved from https://www.irs.gov/pub/irs-pdf/i8965.pdf. See page 3 (Coverage considered unaffordable) and page 9 (Determining an individuals’ required contribution – individuals not eligible for coverage under an employer)

eHealth. (2017). “Affordable Care Act Health Insurance Will be Unaffordable in 2018 for Many Middle-income American families, eHealth Analysis Shows”. Retrieved from https://news.ehealthinsurance.com/news/affordable-care-act-health-insurance-will-be-unaffordable-in-2018-for-many-middle-income-american-families-ehealth-analysis-shows

Additional Information

I also saved complete copies of the downloaded HTML pages from the logged in state and the not logged in state, plus screen captures.

The Oregonian did publish my follow up question, in the comments, asking why my earlier comment was shadow banned. However, there is no answer.

As of today, we will no longer be reading the Oregonian newspaper due to their heavy handed censorship of factual speech. In actual fact I had already limited myself to reading just one article per day due to issues I had already spotted in their content.

I anticipate taking a far harsher tone towards the creation of fictional news by the sanctimonious press. Remember, the definition of “fake news” is the use of a variety of methods, including exaggeration, distortion, emotional hooks and falsehoods to sell eyeballs to advertisers. Many “fake news” services are social media based, online, for profit businesses. Which describes most so-called mainstream media today.

Social media companies really do read your posts, emails and documents

Google’s GMail service “scans” your emails and Google Docs to serve you ads. The word “scans” implies scanning for keywords but that is a false assumption about what is actually being done.

Natural language processing technology has advanced to where these algorithms are the equivalent of someone reading all of your emails and taking notes. Literally, online services are reading all of your email and building dossiers on what they think they know about you, ostensibly to better target advertising to you.

Facebook is taking this to extremes, having announced this week that Facebook’s algorithms are analyzing all of your online posts to determine if you suffer from depression and may be suicidal. In the event their algorithm decides you may be showing suicidal tendencies, Facebook alerts the authorities who send first responders to your home.

In other words, Facebook is now operating as an unlicensed health care practitioner and diagnosing your health based on your writings, and without ever having met you or spoken with you.

Facebook uses this information for marketing purposes too – imagine conducting this analysis and then showing you ads for anti-depressants and “talk to your doctor”. Also consider,

“An egregious example of the kind of behavior these companies’ business models encourage surfaced this summer when an internal Facebook sales pitch to advertisers was leaked to an Australian newspaper. Facebook stated it had pinpointed an audience of thousands of young teenagers who felt “insecure,” “defeated,” “nervous,” “failures,” “worthless,” and “needed a confidence boost.” These diagnoses were based on a psychoanalysis of private Facebook information: what users posted, what they liked, how they appeared in photos, who their friends and how depressed were they as well as their search and shopping histories, visits to mental illness sites or hotlines and so forth.” (source)

Twitter analyzes your Tweets, “Likes” and who you follow, plus combines this information with 3rd party advertising networks to create a profile of attributes. You can see this by going to Settings and Privacy and then selecting Your Twitter Data, page down and look at Interests from Twitter and Interests from Partners.

I discovered that almost everything they deduced about me in the Interests from Partners was wrong – seriously wrong. About the only correct items are that I have a cat and a graduate degree (2 actually, but do not tell them!)

All of this collected data is used to fine tune propaganda messaging directed at you. Of course, much of this is advertising; however, ads are also run for political purposes too. In effect, online services are proving our hypothesis – that social media has become the most advanced, friction-less propaganda platform in human history.

Silicon Valley “tech” firms have morphed into the most advanced propaganda operations in human history. Their actions are conducted in secret, they are unbounded, and they are unregulated. Their technology is now used to directly influence you and public policy.

To illustrate, this week, the head of the FCC commented on “net neutrality” and noted that Silicon Valley tech firms promote neutrality of the broadband pipe – while simultaneously censoring discussions conducted on their platform (Twitter and Youtube both do this). As if on cue, almost immediately thereafter, Eric Schmidt, the chairman of Alphabet (parent of Google) announced they will now censor news.google.com to remove stories from Russian media outlets such as RT.

In that instant, Google showed its defense of net neutrality is shallow if not completely hollow. Google wants other people to be forced to be neutral while preserving a right to censorship (including news and political speech, among the most protected of speech in the United States) for itself.

Google, Facebook and Twitter are not merely platforms for the dissemination of propaganda – they are themselves major propagandists seeking to have others adopt their agendas for their benefit.

Google is not just evil (to re-arrange their motto of “Don’t be evil”) but is acting as a menace to democracy itself.

And what could possibly go wrong with Facebook’s surveillance and analyzing our posts and perhaps discovering that we hold views contrary to the power structure?

Someone should write a book about this – I know, they could title it “1984”!

Bottom Line

Online services including Google (Gmail, Docs), Facebook and Twitter and undoubtedly others are doing the machine equivalent of reading your email and documents, taking notes, and analyzing what you are writing to draw conclusions about you.

What could possibly go wrong?

TripAdvisor’s censorship of online reviews more extensive than originally thought #tripadvisor

TripAdvisor admitted to censoring some specific negative reviews by consumers reporting that crimes and acts of violence had occurred at some venues.

Since then, more people have documented that TripAdvisor has censored reports of crime at U.S. hotel and related properties. Update: TripAdvisor caught lying, now said to be under investigation by the Federal Trade Commission.

Unfortunately, online review sites are worthless due to a combination of “gaming the system” with fake reviews (both positive for your business and negative fake reviews for competitive businesses) and active censorship of negative reviews by online review sites such as TripAdvisor.com.

Social media’s ease of publishing has led to a rapid degradation in the quality of material available online. Online reviews are a form of propaganda – intended to influence your decision making. Review web sites know this. Business operators know this.

Now we know this: We intentionally avoided search results that went to TripAdvisor.com for a trip we completed over a week ago. What else can we do?

 

Measuring effectiveness of propaganda campaigns: How unpopular is the Obamacare individual mandate?

Previously, this blog pointed out that public opinion polls are primarily a measure of the effectiveness of propaganda. Routinely, members of the public are asked to have an opinion on subjects about which they likely know little and what they do know was disseminated to them through a variety of propaganda methods and channels.

The following item illustrates this well.

Trump said the individual mandate is “highly unpopular.” As recently as February 2017, a YouGov poll found that 65 percent of people opposed it, a finding that is consistent with earlier polls from other organizations. That’s a fair sign of the provision’s unpopularity.

On the other hand, when people were given more details about the mandate, they had a more favorable view, as high as about 60 percent.

Source: How unpopular is the Obamacare individual mandate?

The second paragraph confirms the thesis – a public opinion poll is measuring the effectiveness of the propaganda campaign and little else.

To illustrate, here is additional propaganda on this subject. There is much discussion of whether or not there must be an individual mandate. What if the individual mandate is a moot issue due to how the ACA itself is written?

The authors of the ACA defined what was meant by “affordable” – if the price of insurance is too high, the government cannot force someone to purchase insurance. Here is an example – a 64 year old married couple living in Laramie, WY with an income of $65,000 per year is above the subsidy cut off level – that means there is no subsidy assistance to them.

The lowest cost Silver plan available to them is (quoted screen capture from HealthCare.gov for 2018) a staggering $49,000 per year:

First, you may be surprised that ACA insurance premiums can cost near $50,000 per year. Second, you may surprised that a person with a $65,000 pre-tax income has an ACA insurance bill of $49,000 per year with a $5,000 deductible – and no subsidy. This means their costs are $54,000 per year … or about 100% of their after tax income.

Clearly, this couple cannot afford ACA insurance. The ACA recognized this and this can be seen in IRS Form 8965. For 2016, if the least cost Bronze plan exceeds 8.13% of your income (modified adjusted gross income or MAGI), then you are exempt from the mandate. The least cost Bronze plan for this couple is $2,750 per month or $33,000 per year.

If this couple’s income is LESS than $405,904 per year, then they are exempt from the ACA individual mandate to purchase this insurance per IRS Form 8965.

For couples or families over age 45-50, the ACA rates have risen so high, so rapidly, that  s likely a majority, and nearly everyone over age 55, are exempt from the individual mandate, by law.

If your insurance costs are $750/month, then you are exempt if your income is less than $110,000 per year. Surprised?

In effect, the individual mandate is a moot issue for perhaps most of the unsubsidized market.

When you see actual ACA price quotes like the above, what do you think of the individual mandate?

Does this illustrate how a public opinion polls merely measure the effectiveness of propaganda campaigns?

Notes

In Laramie, WY, there is a Gold plan that costs less than the cheapest Silver plan – for a mere $40,000 per year. Why is the Silver plan used in this example? Because the US Department of Health and Human Services uses the Silver plans as the “benchmark” and subsidies are given out based on the pricing of the lowest cost Silver plan in each market.

Is Laramie just an outlier? Perhaps, we have not looked at all markets. It is common, however, for the ACA rates to run $25,000 to $35,000 for families in different locations in the U.S. The NY Times just noticed this for the first time in November of 2017 – check it out. (The NY Times diagnoses the wrong root cause, however – to learn about the actual root cause and possible solutions see my paper.)

Why is there no subsidy for this couple? Because the subsidy cut off level has nothing to do with the cost of insurance. The cut off level is set to 400% of the regional poverty level. There is no connection what so ever to insurance costs. Thus, a couple earning $65,000 per year has an insurance premium of $49,000 per year and is ineligible for a subsidy. If they made just $1,000 less per year, they then qualify for a $43,316 per year subsidy from the taxpayers. (Of interest, the out of pocket payment by the subsidy recipient works out to about the 8.13% value – as insurance rates rise, the subsidy payment increases to keep the consumer’s costs at the ACA defined affordability level. Of interest, in another year or two, the costs of insurance for some will exceed their annual income – and the subsidy value will also exceed their annual income too).

Is the 8.13% value set by the ACA and the IRS too low? The government’s data indicates we spend about 18+% of national GDP on health care. By their reckoning, insurance plus out of pocket costs and miscellaneous expenses are going to result in an average family spending of perhaps 18% on health (this is a simplified explanation). Thus, 8.13% for insurance is the component of this spending that is used as the ACA “affordability” criteria. Higher than this, and the government says it is not affordable. The government had to pick some level and chose this one based on data. The government might have selected a different dollar value – for example, should the government mandate that you spend 120% of your income on health insurance?

The bottom line is that ACA health insurance is not affordable according to the ACA itself.