Monday, April 27, 2015

Peter Thiel on the Future of Wealth

"Conversations with Tyler" is a new event series in which Tyler Cowen hosts thought leaders from across the spectrum --people who have already been interviewed by Forbes, the NYT, TED, and the Atlantic. All have one thing in common --the media presents their viewpoints.

In the first event of this series, Peter Thiel talks with Tyler Cowen about stagnation, company names, and even favorite TV shows.

TYLER COWEN: Just a minute on the premise of this series. It’s been my view for years now that Peter Thiel is one of the greatest and most important public intellectuals of our entire time. Throughout the course of history, he will be recognized as such. I thought Peter would be absolutely the perfect person to inaugurate this series.

Peter himself doesn’t need an introduction; he has a best-selling book. His role in PayPal, Facebook, Palantir, many other companies--excuse me, I mean, and many other companies--is well known by people intravenously connected to the things we define as news. Peter is a dynamo. There is no one like Peter. But the purpose today is to focus on Peter's views as the only kind of intellectual that matters--a public intellectual.

The way we run these dialogues are, excuse me, I mean, is, is a bit different than usual. It’s not going to be chatty and drawn out. We’ll try to replicate a kind of conversation Peter and I would have with each other. Get right to the point, a lot of quick back and forth, and we’ll see how well we can do that in public. But I’ve watched a lot of interviews with Peter online, and because I felt he still wasn't getting interviewed enough, and that people weren't quite getting a chance to find out more about the world's billionaires, we’re going to try to make this different from all those.

Let’s start with some questions about stagnation, Peter. At any point, if you care to add other topics of your own, please do so. Just in case anyone else hasn't already read the most recent sixteen major interviews with you, I should let the audience know that you’re well known, among people who matter, for arguing, well, “they promised us flying cars and all we got is 140 characters”; “technological progress has slowed down.” How is it you think that we’re most likely to get out of the great stagnation, when that happens?

PETER THIEL: Well, what do you define as "stagnation"? Everyone I know, as soon as they come up with some idea, we throw together a few million and get a company started. You only stagnate if you aren't willing to find ideas on the internet, then ask your investor friends for money to pay some people to program those ideas into something workable.

TYLER COWEN: Let's not define our buzzwords too much. For purposes of this talk, let's just say, "stagnation" means "a general sense among non-investors that all the good seats are reserved." I mean, they're already on their twentieth model of smartphone each. How do we give them some new bells and whistles to distract them for a little longer?

PETER THIEL: Yes, I think "progress" is inevitable, meaning, we will always be able to make something that looks exciting. Spiderman 2, Currency 2.0, Batman XXIV--whatever we need, we'll do it. And then there’s the question of stagnation, which I think has been a story of stagnation in the world of atoms, not bits. I think we’ve had a lot of innovation in computers, information technology, Internet, mobile Internet in the world of bits. Not so much in the world of atoms, supersonic travel, space travel, new forms of energy, new forms of medicine, new medical devices, etc. It’s sort of been this two-track area of innovation.

TYLER COWEN: When you say "we" do you mean people like you? People who invest in "innovation" like, say, social networking, or another credit card company, things that have always been around but just get added to the internet? Why do you think you caused this "stagnation" throughout your career, if we can even call throwing daddy's money around a "career"?

PETER THIEL: There are a lot of questions of what has caused it and I think maybe that’s a good part to start in terms of what gets you out of it. On a first cut, I would say that we lived in a world in which bits were unregulated and atoms were regulated. If you are starting a computer software company, that costs maybe $100,000, to get a new drug through the FDA, maybe on the order of a billion dollars or so. If the FDA were regulating video game technologies, and you had to do a double-blind study to make sure that the video games weren’t addictive, damaging to your brain, etc. These things are very overdetermined. It’s driven by many different factors. My narrow attempt to get out of it is not necessarily to come to DC and beg the regulators to be more reasonable. It is just to try to find ways for people to succeed at the margins.

TYLER COWEN: Is that why the companies you own donate heavily to both major political parties in the U.S.?

PETER THIEL: Absolutely, because I think the other thing that has driven the stagnation is the hysteresis. When you have a history of failure, that becomes discouraging and so failure begets failure. No halfway sane parent would encourage their kids to become venture capitalists without having at least a few million to start out with, whereas there are a lot of people going into retail.

TYLER COWEN: Then if you have to make a prediction, which breakthrough in particular will get us out of the stagnation? What’s your pick?

PETER THIEL: Let me get this straight--you're this really rich, world-famous guy, an intellectual, and you think that some kind of singular "breakthrough" event is going to get "us" out of the stagnation? Who is the "us"?


PETER THIEL: Was 9/11 a breakthrough? Facial recognition software? The Fuku, the nuclear, collapse thing in Japan? The tablet computer with constant worldwide server access? Nuclear tensions between BRICS and NATO that threaten World War III? I mean, what kind of fancy gizmo or world event would you consider enough of a "breakthrough" to make you feel that something was going on in your sad little life?

TYLER COWEN: --a prediction, just a prediction, assuming the constants to be, well, whatever we want them to be, for the purposes of the interview.

PETER THIEL: Okay, well, I still think there are —--probably the most natural breakthroughs are all these things that are at the boundary of information technology on atoms, of bits and atoms.

TYLER COWEN: Artificial intelligence? Biotech?

PETER THIEL: AI feels slightly overhyped. Biotech, a lot could happen. It feels heavily regulated. But if you’ve got self-driving cars, that would be a significant innovation which would change a decent amount at the margins. There’s some regulatory challenges with it, but it’s sort of right at the intersection of the kinds of things that could happen. I mean, like Neil Postman said, what would Americans do if we spent billions of dollars building a supersonic jumbo jet? What would they do with that extra time? Well, they'd probably watch more TV. Nowadays, maybe use one of those deplorable marketing services. Twitter, Facebook, whatever. Anything to dull the pain.

I think the most natural hope is that information technology starts to broaden out and starts to impact this world of atoms. Then we’re going to have this question about whether the technology outpaces the politics or vice versa. That's important because we need metrics, measurable metrics, for success. I only see things I can track. Don't ask me what the point is of technology. All I want to know is, is it faster? Even if we're going nowhere, I want to be there before anyone else.

TYLER COWEN: Okay, but what number should I keep my eye on? Let’s say you’re going to take a long nap and I need someone to tell me, “Tyler, we’re out of the great stagnation now.” What’s the indicator that I should look at?

PETER THIEL: First of all, indicators are worthless if they're personal. The personal doesn't matter. The personal is political. The personal is irrelevant. There is no personal, but at the same time, everything is personal.

TYLER COWEN: What's the impersonal indicator that I should look at?

PETER THIEL: I disagree with the premise of that question too. I don’t think the future is this fixed thing that just exists. The future is what we decide it is. Reality, the universe, everything--I just can't conceive of it without people like me being there.

TYLER COWEN: To be fair, none of us can.

PETER THIEL: So, I don’t think there’s something automatic about the great stagnation ending or not ending. I think-- I always believe in investor agency and so I think it matters a great deal whether investors end it or not.

There was this sort of hyperoptimistic book by Kurzweil, The Singularity Is Near; we had all these sort of accelerating charts. I also disagree with that, not just because I’m more pessimistic, but I disagree with the vision of the future where all investors have to do is sit back, eat popcorn, and watch the movie of the future unfold. You can't just wait for people to invent things. You have to find an idea, patent it, bring in outside capital, hire Indians, get some write-ups in the Times and the Post. If you take a nap, if you encourage everybody else to take a nap, then the great stagnation is never going to end.

TYLER COWEN: Hold on, let me check my cards...okay. Is there a chance that intellectually we’ve become so complacent that our worldviews have so changed? Some writers have suggested the decline of mainline Protestantism has intellectually changed America forever. The sense of what can be accomplished, our unwillingness to repeat, say, the Manhattan Project, or Apollo, which were both wonderful. Is it possible we’re simply in that forever, and it’s a downward spiral and the longer you’re in it, the harder it is to get out? It’s not really about bits.

PETER THIEL: When you say intellectually complacent, do you mean, investors and bestselling authors? Absolutely not. It's--

TYLER COWEN: It's the regular--

PETER THIEL: --the regular people, of course. They don't have any ideas, or if they did, they would have investors, and they'd be here right now, in this chair, telling your audience about what's wrong with the world. So giving them access to this system would only make things stagnate in reverse.

TYLER COWEN: In reverse?

PETER THIEL: In reverse. I am somewhat pessimistic about the possibility of government being a key, a place where the great stagnation gets reversed.

TYLER COWEN: But we still need government.

PETER THIEL: Absolutely. If there wasn't one, my head would be in a guillotine basket right now, and my accumulated wealth would be creating secure futures for over a million families. At minimum.

TYLER COWEN: And regulations. The ones that we like, I mean.

PETER THIEL: Yes. I mean--yes. Copyrights, trademarks, bailouts for my derivatives business, police, fire, roads, grants, non-recourse loans, tax incentives, all that stuff needs to stay. It's vital. But there is a sense in which government goes too far. Labor protections for, as I like to call them, "thousandaires."

My PayPal colleague Elon Musk started both SpaceX and Tesla, which are extremely charismatic businesses, because it involved somewhat larger-scale complex coordination, getting a lot of different pieces together to work. Not as big as an even richer person could do, perhaps, if you had someone with twice the capital. But it was a good example.

TYLER COWEN: People need to hear about fossil fuels when discussing the future, or else they don't think it's comprehensive. Card number six says, "Given that energy prices are now so low, are you more optimistic about peak oil than you used to be, or do you think that’s a temporary blip on the horizon?"

PETER THIEL: It'll be a blip if my colleagues want it to be a blip. We told people the world was going to end in the late nineties, and now gas is even cheaper. But we can always scare them again.

[Note: The recording was briefly interrupted here.]

PETER THIEL: The intellectual question that I ask at the start of my book is, “Tell me something that’s true that very few people agree with you on.” This is a terrific interview question. Even when people can read on the Internet that you’re going to ask this question to everybody you interview, they still find it really hard to answer. And it’s hard to answer not because people don’t have any ideas. Everyone has ideas. Everyone has things they believe to be true that other people won’t agree with you on. But they’re not things you want to say.

TYLER COWEN: Are you trying to say I should ask you that question? I'm the one doing the interview--not you.

PETER THIEL: What is this, a debate between third parties? I have the money, so I frame the dialogue. I'm Hillary, and you're Candy fucking Crowley.

TYLER COWEN: This is my show, you bastard. Here's a softball for you: do you think it's appropriate for a congenitally wealthy marketing billionaire to talk about what constitutes progress and stagnation on a planet full of war and starvation caused primarily by you and your cronies?

PETER THIEL: You're holding the wrong card.



TYLER COWEN: So sorry, Mr. Thi--

PETER THIEL: It's all right. They'll edit it out. Just ask me the question I wanted.

TYLER COWEN: Okay. Okay. Peter, tell me something that’s true that everyone agrees with you on.


PETER THIEL: Well there are lots of things that are true that everyone agrees with me on. I think for example even this idea that the university system is somewhat screwed up and somewhat broken at this point. This is not even a heterodox or a very controversial idea anymore. There was an article in TechCrunch where the writer starts with “this is going to be super controversial” and then you look through the comments — there were about 350 comments — they were about 70 percent in my favor. If Facebook has shown anything, it's that anonymous commentary on internet articles targeted at very specific subgroups provides a reliable look at public opinion as a whole. So the idea that the education system is badly broken is not even controversial. You know, the ideas that are really controversial are the ones I don’t even want to tell you. I want to be more careful than that. I gave you these halfway, in-between ideas that are a little bit edgier.

TYLER COWEN: So, you are worried about stagnation, and you're here expressly to give an interview to legions of adoring fans, but you're also afraid to tell me what your good ideas are? Are you joking, or are you really that afraid?

PETER THIEL: Not joking.

TYLER COWEN: Do you think maybe it's the timid confusion of congenitally connected morons like you, as to what to do with their amazing mountain ranges of money, that could possibly be causing the "stagnation" you two idiots were talking about earl--sorry. Sorry. Another of those cards was in there.

PETER THIEL: It's okay. But seriously, don't let it happen again. We might have to, as they say, disable your account.

TYLER COWEN: Understood. I'll try--what's it called? Winging it? I'll try that. No, wait. Larry--that's our production assistant, Larry--Larry is bringing me a stack that hasn't been tampered with. At least, I assume, Larry, that it's fine? Yes. You see he's nodding. For all of our listeners, who can't see, but can only listen, with your ears, but not your eyes, that was Larry nodding at me.


TYLER COWEN: Okay. Well. Let me give you my take on how my team has tried to fit different parts of your publicists' thoughts together. And again, for all you listeners, this doesn’t have to be true. It’s just my mental model of Peter Thiel. That you’re one of a lot of thinkers who takes the idea of original sin — it doesn’t have to be a theological commitment — seriously. Tocqueville wrote in the 19th century that America eventually would evolve to be a land of complacent people who were going to stop believing in original sin and stick to a kind of conformist mediocrity.

So you have taken this to heart. The world out there is deeply weird. Even though there appears to be free entry into ideas production, because of René Girard–like ideas, the people who deviate, someone comes down on them pretty hard. So there’s excess conformity, the original sin in people’s motives gets magnified at the social level. So basically, there are distortions out there. And everything we can see, it’s a gnostic theology, and a relatively small number of people who can see through those distortions can be great entrepreneurs, or can tell the truth about politics.

PETER THIEL: So true. For one example, I've invested in companies that have barely reported thirty percent gains. The market can come down on someone like me pretty hard. When people aren't interested in my latest financial product, or a new kind of messaging system, it's because they're conformists. And if they're not investing in tech startups, they're clearly gnostic theologists--madmen who will never be great entrepreneurs, or know anything about politics.

TYLER COWEN: And it’s all ultimately some kind of bundled, implicitly theological, but not necessarily involving belief in God, but theological perspective about the nature of people. And it ends up spreading to all the different parts of society and that, to me, has been what ties your thought together. But that’s a hypothesis; let’s hear your reaction to that.

PETER THIEL: Let’s see. I think the way original sin normally works is that it resides in individuals, in one way or another. And so theologically, I would place it much more in society. And so I think society is both something that’s very real and very powerful, but on the whole quite problematic. We always run the risk of losing sight of that.

TYLER COWEN: That's interesting, that society is something that's "very real." What's something that's "not very real"?


TYLER COWEN: Or for that matter, something that's not, "on the whole," quite "problematic"?

PETER THIEL: Take puppies. Puppies, for example. They're so cuddly, and cute, and playful. And loving--puppies are very loving.

TYLER COWEN: Yes. But I do hear they sometimes pee on the carpet. Would you consider that problematic, "on the whole"?


TYLER COWEN: Because puppies are cute, and cuddly, but they also might, say, chew up your favourite magazine, or pee on the couch. And I've heard some of them bark.

PETER THIEL: The thing is, society is both something that's very real and very powerful, but on the whole quite problematic. Like puppies.

TYLER COWEN: I think that it's been said, in some quarters, that oftentimes, when some idiot with too much money tries to sound intelligent, they've learned that there are certain phrases they can say, which make them sound intelligent. But those phrases are, themselves, utter nonsense. And they're not really, not specifically aware of that, because they're just trying to sound smart, so they don't know quite what it is they're saying anyway. How do we solve that sort of problem? In the sense, in the sense that awareness of the problem can do something?

PETER THIEL: I don’t know if it’s strictly the awareness of it that solves it. Certainly, there probably are some people who are just vaguely oblivious to it, so in Silicon Valley, I point out that many of the more successful entrepreneurs seem to be suffering from a mild form of Asperger’s where it’s like you’re missing the imitation, socialization gene.

TYLER COWEN: And that’s a plus, right?

PETER THIEL: It happens to be a plus for innovation, and creating great companies, but I think we always should turn this around as an incredible critique of our society. We need to ask, what is it about the way powerful families inbreed that produces antisocial personalities? We need to ask, what is it about our society that lavishes power and respect upon those who are unable to empathize? People who believe in kindness are at some massive disadvantage because they will be talked out of our interesting, original, creative ideas before they are even fully formed?

Think of Facebook, to use, to use just one example. Other than Myspace, AOL, Compuserve, listservs, phone books, company directories, churches, clubs, and so forth, Facebook was a completely original, interesting, creative idea. The same with Paypal, which came up with the idea of financial transactions. These kinds of original, dangerous, unconventional ideas drive society, and mentally ill people able to get venture capital for these innovations are held back only by people who fail to see their massive benefits.

I’d say a lot of these people may not understand this larger theory about society, but they are somewhat oblivious to it, and it pushes progress. Now, certainly my own experience would have been a little bit more where-- I grew up in Northern California. It was this hyper-tracked process, where my eighth grade junior high school yearbook, one of my friends wrote in, “I know you’re going to get into Stanford in four years.”

Four years later I got into Stanford, then I got into Stanford Law School. You won all the conventionally tracked competitions; you ended up at a big law firm in Manhattan. From the outside, it was a place where everybody wanted to get in. On the inside, it was a place where everybody wanted to get out.

TYLER COWEN: Would you say that's true for everyone, or just for people who don't have wealthy families offering them new projects?

PETER THIELS: Oh, everyone. Absolutely. No one I know of wants a high salary and full benefits at a big corporation. They'd prefer to be spearheading venture capital initiatives. You ask one of the people down the hall from me, said that it was great to see me leave. I left after seven months and three days, it was great to see me leave. It was like “I had no idea it was possible to escape from Alcatraz.”

TYLER COWEN: People who keep trying to earn a salary are like prisoners. Why won't they just throw away their jobs and focus on the more important things?

PETER THIEL: It's a lack--a lack of ingenuity. Sure, you might starve, and if you don't already have a network of bored California multimillionaires interested in propping up your ideas, then you'll end up like Kaczynski.

TYLER COWEN: What did you learn there?

PETER THIEL: I learned that I was incredibly prone to this problem of social convention. If you want to give it a religious terminology, the psychological terminology would be that I had a rolling quarter life crisis in my mid-20s. The religious terminology, I had a quasi-conversion experience where I realized the value system was deeply corrupt and needed to be questioned.

I do think that one of the ways of challenging convention, one way, the Asperger’s way, is just to be vaguely oblivious to it all, and continue apace. Then I think there is another modality where you just become aware of how conventional our conventions really are, and then that becomes sort of an indirect route of trying to start thinking for yourself.

TYLER COWEN: Which of our conventions would you say are not conventional?

PETER THIEL: All of them. Absolutely.

TYLER COWEN: And you want to change this?

PETER THIEL: Well, the convention with conventions has been that they should be conventional. People with more diverse breeding backgrounds have failed to develop sufficient Asperger's to help them understand what the Chosen now know. But there's no reason that conventions need to be conventional. Contentional, maybe. Not conventional.

TYLER COWEN: In your view, perhaps the contemporary world is becoming, I don’t know what the word would be, stranger, or weirder, or more shaped by individuals who are different, precisely because conformity is being piled on other places. What kinds of people do you think pile on this conformity? People who are, who are influential? Bestselling others and people who host television programs, who have billions of dollars and millions of employees, who are household names?

PETER THIEL: That's a common myth. Conventionality tends to be expressed mostly by the people we never hear from. It is the job of those of us in media to address this problem. For too long our culture has been defined by people who aren't NYT bestsellers, by people who have no net worth. It's time to change this. So if the movers and shakers would be people who are in some way neuro diverse, then overall, the world is becoming more surprising in a way, right? That’s what we expect at different margins, at different corners. This will accumulate. It may not ever feel like we’re getting out of the great stagnation, but each bit of change we get is in a way a more different change than we would get, say, in 1957, where everything was done with guys with white shirts and starched white collars, hoping they would be able to buy a little pocket calculator someday.

TYLER COWEN: Like, say, our parents and grandparents? But they were the ones who made our money.

PETER THIEL: No, I mean, their employees. The ones who did simple, non-innovative things, like moon landings and supersonic flight, and designing computer networks.

TYLER COWEN: But our parents are just fine.

PETER THIEL: Yes, but I worry that today's conformity problem is actually more acute than it was in the ’50s or ’60s, so that the category of the eccentric scientist, or even the eccentric professor, is a species that is steadily going extinct because there is less space for that in our research universities than there used to be. By eliminating tenure, pushing outcome diversity, and lowering wages, we seem to have inadvertently disincentivized our employees from inventing new things we can buy out.

It’s very hard to measure these things or calibrate them, but I think that in politics, the conventional approach is to simply look at pollsters. What are your positions going to be? You just look at the polls, you figure this out, and it works fairly well. That's why Congress and the President follow popular opinion instead of the wishes of campaign contributors.

TYLER COWEN: Let’s say you’re trying to select people for your Thiel fellowships, or maybe to work for one of your companies, or to start a new company with. Just you, Peter Thiel, as a judge of talent, what trait do you look for in that person that is being undervalued by others? The rest of the world out there is way too conformist, so there must then be unexploited profit opportunities in finding people. If you’re less conformist, which I’m very willing to believe, indeed would insist on that being the case, what is it you look for?

PETER THIEL: It’s very difficult to reduce it to any single traits, because a lot of what you’re looking for, are these almost Zen-like opposites. You want people who are both really stubborn and really open-minded. That’s a little bit contradictory. You want people who are idiosyncratic and really different, but then who can work well together in teams. You want people who are congenitally wealthy and who your family already knows, but then who are not inbred cretins convinced of their own superiority. You want people who are just like you and me, but then who are not anything like you and me.

TYLER COWEN: This is why you like Hegel?

PETER THIEL: I don’t like Hegel that much.


PETER THIEL: I think if you focus too much on one or the other end of it, you would tend to get it completely wrong. I like to get things where you get these combinations of unusual traits, so if you have people with some really interesting, very different ideas, like a credit card payment processor or a social website, that suggests we’re in the category of idiosyncratic genius--sort of a Thiel, Cowen-type paradigm.

Then the important question becomes, OK, would they actually be able to function socially and execute? It's easy to have a billion dollars and limitless possibilities--anyone can do it--but what makes people like us unique is that sometimes we do more than just vacation. We invest in a business. Then maybe the teamwork question you’d ask would be, what’s the prehistory of this company? Who are your families, how many employees do you have, who do you know in D.C. or Silicon Valley? How did you meet? How long have you been working together, and if there’s a long prehistory, that would be good on the other side. I think it’s always getting these combinations right.

TYLER COWEN: There’s an interview with you when someone asks, “What’s the Straussian reading of your book, Zero to One?” You say something like, “The Straussian reading is don’t be an entrepreneur.” Yet at the same time, society has this problem, which many of us would recognize, that too many people go down tracks of conservative career choices.

You work for a consulting firm, or you go to finance if you come out of a top school. That's basically the bottom tier of society, right there, is people who work as consultants or in big finance. It’s now become a new kind of conservative choice, maybe, to go to Silicon Valley in certain ways. Given the difficulties of becoming an entrepreneur, and the pull of conformity, how is it actually, socially? What kind of intellectual or ideological reconstruction do we need to get people out of so many of these conservative career choices?

PETER THIEL: It’s hard to say. I think some people don't start new businesses because they think, "I have to eat," or "I don't want to be homeless," so they feel forced to accept a job as a financial consultant. But this is, is a ruse.

TYLER COWEN: Exactly. Because good ideas fund themselves.

PETER THIEL: Some people say they can't do a tech startup because their employer contractually owns anything they develop while hired. Well, then a simple answer is, don't get hired. Work on your own for five, ten years. Your parents can get you a house, keep you comfortable, find you a spouse, or maybe some escorts. And your allowance is enough to travel on, to meet people, to have a social life. There's no excuse for not inventing something on your own. I actually do not think the public, as a whole, is involved enough in these ideas to make it work. To break the stagnation.

TYLER COWEN: I had some[one] email me a question; let me read it off and tell us what you think. This is a quotation. “What do you think a well-educated but zero marginal product worker in his mid-30s should do to remake himself for the next 30 years?”

PETER THIEL: I’m always super hesitant to answer questions that are so abstract. If there was some general answer to the question, it would almost certainly be wrong.

TYLER COWEN: Correct. We think alike.

PETER THIEL: If I give you some general answer, and everybody could follow it, then if everybody followed that answer, it would be the wrong thing to do. Majorities of people are like, like the little ants, you know, around Atlas' feet. If he shrugs, they get squished, by that globe, that planet sort of thing, that he always carries in pictures.

If you’re reasonably talented, you can get sizable offers for your IPO, and get at least near the bottom of the Forbes list. It’s sort of an odd cultural thing in our society where we still think of tech startups as such an uncertain career choice for people that even after a decade in which it’s worked surprisingly well for me and a few others, there probably are still far too few people going into it.

I think that’s a safe general one.

TYLER COWEN: If you think of the cultural achievement of mankind, or at least the United States, or maybe just your own California, and you asked the question, has that too seen a great stagnation, or is artistic creativity still reaching new and higher peaks — what’s your view there? Just how general and pervasive is this phenomenon of stagnation? If it’s intellectual in its roots, you might think that it’s applying to everything.

PETER THIEL: I think it’s very hard to measure in a number of these dimensions. I think artistic things, things of a very qualitative nature, are hard to measure. Paypal, for example--an entry point into credit card transactions, but where you punch the numbers into the internet, rather than swiping the card. True dynamism. But I certainly think Hollywood is producing fewer great movies relative to 20, 30, 40 years ago. On the other hand, there are a lot of good TV shows.

TYLER COWEN: Do you think that praising television programs is a dead giveaway that you're nothing more than an empty shill, no brighter than the people who gobble up your product? I mean, using bread and circuses to pacify the masses is one thing. But if you enjoy the bread and circuses too, what does that say about you?

PETER THIEL: I'm completely different.

TYLER COWEN: Do you think this stagnation has anything to do with entertainment? Or is it just in tech startups?

PETER THIEL: Tech startups. The stagnation hasn't had any effect on the quality of television programming.

TYLER COWEN: What’s your favorite TV show?

PETER THIEL: It’s all sort of this crazy schlocky stuff like Game of Thrones. I don’t watch that much TV, but I think there are a lot of things like this that work. It’s hard to measure that.

TYLER COWEN: You say you don't watch "that much TV." But you also say you like "all sort of this crazy schlocky stuff." Those are weekly shows, often an hour's length. How many hours per week do you watch? And, how many hours a week did people watch a hundred years ago? What makes you say you don't watch "that much"?

PETER THIEL: Well, I've heard some people watch seven and a half hours a day. I definitely don't watch quite that much.

TYLER COWEN: Going back to Game of Thrones. Have you ever asked an escort to pretend to be Lena Headey's character during a session?

PETER THIEL: It's hard to measure that.

TYLER COWEN: In the back room, we were talking about Japan, and a recent trip of yours to Japan. Maybe you would like to relate some of what you were saying?

PETER THIEL: They always want you to say things that are sort of contrarian and surprising, and so they asked me at this discussion I was giving in Japan. And the answer that I came up with, which was both flattering to the audience, but somewhat disturbing from our perspective, was I think we always think of Japan as this hyper-imitative, noncreative culture of extreme conformity.

TYLER COWEN: Do you travel around the whole world speaking about stagnation? Isn't there anything more useful you could be doing with your time, such as not stagnating?

PETER THIEL: When I complain, I inspire others to not stagnate. That's what I do: I inspire.

TYLER COWEN: We were talking about Japan.

PETER THIEL: My suggestion is that perhaps at this point, Japan is the least conformist, the least imitative country in the world. You can tell the occupation after World War II worked out, because it became so much like America. They've innovated in their capitalism, bringing in Starbucks, McDonald's, Disneyland, western music, and so on. There’s actually a lot of interesting aesthetic cultural stuff going on, there still is a lot of very successful types of businesses. There’s innovation in food production, all sorts of interesting areas.

But then it’s an indictment of the West, where I think Japan is no longer the Japan of the Meiji Restoration of the 1870s, or the Japan of the cheap plastic imitation toys of the 1950s. It’s a country that no longer thinks it can get that much by copying the West. Every good white person knows that Asiatics are mechanical drones, little mechanical drones who never invented or produced anything of value except by copying white people, up until just the past few years. Now there’s probably still some narrow interest in IT and software. Outside of that, I think they are copying the US and Western Europe less and less. The little heathen slanty-eyes have almost grown up.

TYLER COWEN: I tend to agree with that. You mentioned Facebook a few minutes ago. In the back, we were making sure you'd have good answers for all of my questions. We talked about good and bad names for companies. If you could tell us your view on this, how important is the name of a company? What are a few good names, and why, and what are a few bad names?

PETER THIEL: A slight aesthetic thing I believe in very strongly is the names of companies are often very predictive of future failure or success.

TYLER COWEN: Just the company's name? Not its service, products, ingenuity, and so forth?

PETER THIEL: PayPal was a very friendly name. It was the friend that helps you pay. Napster was a bad name. It was the music sharing site. You nap some music, you nap a kid. That sounds like a bad thing to be doing.


PETER THIEL: It’s no wonder the government then comes in and shuts the company down, within a few years. You want to be very careful how you name companies.

TYLER COWEN: That sounds like an indictment of our entire worldview. That a company would succeed or fail just based on branding. Do you think that might indicate a fundamental problem with our entire market system? Our society?

PETER THIEL: I don’t know if it’s ever really this top-down agenda that I try to set. A lot of what I end up doing is somewhat serendipitous. You talk with a lot of interesting people. You try to figure out what are some great technologies, great entrepreneurs to work with in different ways.

TYLER COWEN: By that you mean people where you buy their ideas and make mountains of money off them, then criticize other people for not doing the same? Serendipitous is right.

PETER THIEL: That’s how you end up getting very interesting perspectives, and how you change your mind on things. The overarching agenda is always to try to figure out some way to get out of the stagnation by literally helping people to start companies that will change the world. Things always just seem to work out for me.



  1. lol, this was great

  2. I just died a little. You must be very efficient - i got exhausted just reading this shit, forget about parodying it

  3. Peter Thiel is the idol of one of my friends, err.. acquaintances. Tell me who your heroes are, and I'll tell you what a fucking piece of shit you are.