I’ve applied block quotes to the responses, all inner emphases are mine. This just something I found … very interesting.
Original source here; this is copy-pasted from Google Translate. Copyright NZZ.
Translated Headline(?): Paypal founder and philosopher Peter Thiel: “The heads in Silicon Valley have become the same.”
René Scheu, Los Angeles
Mr. Thiel, we meet here in Los Angeles – and not in Palo Alto, where you worked for years. They left Silicon Valley. Is something wrong with the hotspot of the tech industry?
There is far too much convenience and conformism there. Look: In 2005, I gave a speech in Stanford, in the middle of Silicon Valley, and the question was – where is the next Google coming from? The answer I gave back then was pretty optimistic: with a 50 percent probability, the next Google is within eight kilometers. We do not find it in the search engine, no, we find it here, in the immediate vicinity of Stanford. And in retrospect, I was right: the next Google was called Facebook, and it was even just three miles from the room in which I spoke in 2005. Today, I would say that the likelihood that the next Google will ever be found anywhere in Silicon Valley, is significantly less than 50 percent.
Why? What happened in the meantime?
Well, the Valley had unique advantages for years: there were network effects everywhere. There was this high intellectual intensity and diversity. There were good people just waiting to get started, entrepreneurs, investors, innovators. And there was this incredible speed, especially as far as consumer-oriented Internet companies are concerned. The situation has changed drastically in recent years. Good people can start with their companies somewhere in the US, and they also get the money they need if they present a compelling business idea. Secondly – the positive network effects in Silicon Valley have turned into their opposite, indeed downright perverted.
That’s a strong word. Do you feel wrong?
Violated – why? I am a venture capitalist – the business opportunities are dwindling, my interest is dwindling, because at some point it will be intellectually poor. Look: The wisdom of the many has turned into the stupidity of many, yes, some kind of mass delusion. The intellectual, but also the political conformism in Silicon Valley is screaming. To keep it clear – I have to say it in German: The heads are the same. One says what the other says, so as not to offend. The same dynamic has long been playing in the business sector as well.
How do you determine this?
Silicon Valley is now more fashion than opportunity. If one does what the other does, and one wants to buy what the other has just bought, so when that kind of gold rush mood prevails, then you know that the best time of a place is over. All these phenomena have been visible in Silicon Valley over the past five years. It is no longer the good but the greedy people that come first. And the people who live have long since realized that something is wrong.
There is a simple indicator for this: If a one-room apartment costs $ 4000 rent, then something is lazy in the state. Then creative work becomes too expensive, then you can no longer do things that take time. The focus is then the fast profit. And dominate the big companies with pricing power, who can afford such conditions. Attention, bubble!
Still, admit it: you miss the intensity of Silicon Valley here in Los Angeles.
… a small team needs intensity to succeed. And so I tick, right. On the other hand, intensity also has a problematic side – when it comes to the intensity of the big competition. The former is healthy and spurs you on, the latter is unhealthy and will ruin you in the long run. Silicon Valley reminds me today of Manhattan, Stanford more and more of Harvard. At best you have a tight grip, but no more productive stress.
It’s not said that the next internet giant ever comes from the US. Maybe he is just emerging in China. Do you have the East in mind?
Of course, I want to understand what’s going on there. China is a hotspot in the digital economy. Personally, I hope that the country does not become too powerful. And I see how difficult it is to really participate as an outsider. The Chinese are not letting investors like me who are not a registered member of the Chinese Communist Party, and probably do not have the best reputation, out. But you do not have to go so far in the distance, also in Europe is happening, but more in the East than in the West.
They have invested in some startups in Berlin money. , ,
Not only. We have successfully acquired funds from Spotify in Sweden, the music streaming service, Deepmind in London, which specializes in artificial intelligence and has since been acquired by Google, and Transferwise, also in London, a leading fintech provider, and then, yes , at N26 in Berlin, a direct bank that can be operated via the smartphone. Today, I am less optimistic about Berlin than a few years ago. The German capital already shows symptoms of inertia. Berlin has to seriously ask itself – does it want to be a place where young, ambitious people go to make a difference, or does it want to be a place where young people move to retire at an early age? You can not do both.
How do you see the startup scene in Switzerland? There is indeed a lot going on, sometimes in Zurich, thanks to ETH graduates.
Switzerland seems to me more interesting for what I call hard-tech – that is, business outside pure Internet services, especially in the biotech sector. It often takes more capital and effort to make these ideas fly. You need people who excel in science and implementation, in creation and business. It seems to me that Switzerland is plaster that deserves a second look – especially for this combination.
Artificial intelligence, virtual reality, self-driving cars, colonization of the universe. Where do you expect the next breakthrough?
To be honest: that’s too abstract for me, too much gibberish. Valley’s public relations machinery brings such word creations into circulation, but what do they actually mean at the end of the day? I have the greatest reservations about the expression of artificial intelligence. If this refers to the last generation of computers or the next one, we associate this with the fight man against machine as in the “Terminator” movie of 1984, we speak of the surveillance state of China or of a future à la Ray Kurzweil, in the man-machine Cyborgs represent the next step in cultural evolution? KI means everything and – therefore, dialectically thought – nothing at the same time.
What are the next challenges of human life for which the technology has to offer new solutions?
We are at a turning point. For a quarter of a century it was all about Internet services for consumers, one could also say: the economics of digital platforms. They should make life easier. All giants existing today fall under this category: Amazon, Facebook, Google, Uber, Airbnb. The value, depending on several hundred billion dollars. The biggest company, not just software-based, may be Tesla by Elon Musk. Their value is expected to amount to 40, a maximum of 50 billion. Meanwhile, the best and most successful biotech companies are worth 10, maybe 20 billion. In short, software was so far the only game in which the mail went off properly.
So is the time of software over and the time of digitally upgraded hardware is coming?
That’s the big question. New internet services sprang up like mushrooms in no time at all, and they were only possible thanks to the smartphone, a true innovation dating back over ten years. The existing Internet companies will continue to grow, no question, but I fear that the really good, really disruptive ideas are largely exhausted. And as far as hard-tech is concerned, well, I think we’re just at the beginning.
Keyword biotech. In your manifesto of 2009, you mention the overcoming of death as one of the central demands of a serious libertarian philosophy. In contrast, classical philosophy would emphasize the mortality or finiteness of man as the source of his innovative power, which is so important to you. How do you get to your point of view?
The question of the incentives is always tricky. I remember a conversation with my grandmother’s brother in Germany. My great-uncle was a very smart guy, intellectually broad-minded, and had worked well in a bank. He was 80 at the time and told me, “Look, I could have gotten four doctor hats since I retired, but I did not grab it because I did not really believe I was going to be that old.” Those words resonated in my head for a long time and they are the perfect counter-example to the reasoning of classical philosophy.
How exactly – because having fun in life is the best motivation?
Well, the good people are not motivated by morbid thoughts or the existential fear of Martin Heidegger. Rather, they do it because they want to do it, and the perspective of being able to do all sorts of things – an infinite life – spurs them all the more. Conversely, those who are frightened of death do not necessarily have a better access to reality or more bite. Because fear inhibits. I think people obsessed with existential fear are much less productive in the end. Creative are those who successfully oust death.
Are you afraid of death yourself?
To be honest, he does not interest me at first. Stoics, for example, are obsessed with death. However, I am the opposite of a stoic, I loathe the peace and have no sense in the countryside to live and meditate on the environment. And neither am I an Epicurean who in the face of death concludes that he best enjoys every moment because the end can always overtake him. Bullshit! To be honest, I would not invest a cent in companies that are stoically or epicurean. I do not want to just accept this random, crazy world because I can not change it anyway. No, I want to change it, I want to shape it, and I have a hell of a lot of fun with it. The overcoming of death is not the downfall of the West!
They address a mentality difference between Europeans and Americans. However, not all Americans want to abolish death immediately. So what are you doing? And how do you want to do that?
In the early modern period, in the 17th and 18th centuries, the radical extension of life was one of the major tasks of the scientific project. Just think of Francis Bacon or, later, Benjamin Franklin in the US. We lost the optimism of these great people somewhere between the 19th and the 20th century. The question of why people age at all is far too little research. We do not know it in the end. There are some biological theories, but not the last. The stem cells do not die, but reproduce, but we, the carriers, die. This is shocking on the one hand and highly exciting on the other. Most of the diseases we have are related to age in one way or another, and on the other hand, aging itself can be considered a kind of disease. Illnesses can be healed. Is aging really irreversible, or are we just thinking? So why, in other words, should not we also be healed of death?
You have studied philosophy. And I know that you like Leo Strauss, the German-American professor of political philosophy. Strauss once said modestly: “We ourselves are not wise, but wish to become wise, we are wisdom seekers, philo-sophoi.” Is that in line with you?
With this quote I have my trouble. The question that immediately arises to me is the following – why should I strive for wisdom if in the end I never get it? Strauss still thinks here very European, as if the endless search for wisdom or truth is a value in itself. I think that’s diametrically different. We should look for her – and then find her and do something with her that brings us further.
As far as the Internet is concerned, however, the wisdom is still kept within narrow limits. The net was once the promise of great freedom – coupled with the idea of a space of informal exchange, according to the motto: You can say whatever you think. We continue to move away from this promise.
That’s right – that was the 1990s version of the Internet: a future of privacy and anonymity, ie encryption and non-transparency. Today’s version has not much to do with it. The Internet is becoming increasingly transparent, that is public, and therefore less private. There is almost a politicization of the network.
Once there were states that practiced censorship, today it is private players such as Facebook or Google. Is this really an improvement of the situation – or even an aggravation, because no democratic control – however rudimentary – is possible?
No. State censorship is always worse than private, for the simple reason that the state is always the most powerful player. But I think anyway, we have to be precise and distinguish a few things.
On the one hand, we have the problem of censorship / freedom of expression. On the other hand we have the ball of privacy / transparency, and thirdly there is the antitrust / monopoly question. The question of censorship was absolutely not an issue 20 years ago – on the contrary: The Internet was a big progressive promise of freedom. The hope was that all would become progressive contemporaries, who would exchange their almost identical views and positions. But the internet did not bring the great harmony on earth, but rather worked like a continuation of the Gutenberg project. All those whose attitudes and beliefs were suppressed or did not appear in the established media suddenly gained a hearing; it was not for, but against the establishment. After the invention of the printing press it abounded suddenly of Protestant writings, which wrote against the catholic orthodoxy, and in the net there was at some point a predominance of conservative views, which were directed against the left-liberal mainstream. Only then are the Brexit and the rise of Donald Trump explainable.
And privacy – is it, in fact, a thing of the past due to technological development? It seems to me that most users would have long since resigned: For years we have the personal data about us – for a sandwich.
Hm. Difficult question. I’m afraid I have to go out.
If we were in 1968 and we were talking to each other, all the experts would have said: Digital technology promotes centralization. The vanishing point of all performances was the omniscient god-like computer that owns and processes all the data – just think of “HAL”, the supercomputer in Stanley Kubrick’s “Space Odyssey”. Thirty years later, in 1999, the computer world presented itself in a new light: Most dreamed of a totally decentralized world with extremely many PCs, the libertarian and cryptoanarchist fantasies knew no bounds. The world state was over, now the individual was the unit of measurement. But then the scenery changed again. Twenty years later, today, we are suddenly approaching the idea of 1969 again: according to most people, it will be the states or monopolistic companies that control big data and develop new supercomputers. The big worry now is that the government – in cooperation with the big tech giants – knows more about you than you know about yourself. Everyone is afraid of the new great incapacitation, dominated by the fear of a new totalitarian regime.
The big question is – are they just fears, or are they realistic ideas of what is coming?
I am not a clairvoyant. What I can say is this: Even technological history is not linear, but more of a pendulum movement. Therefore, I assume that the totalitarian, technologically upgraded surveillance state is not the final state. We do not want a social credit score like in China. We do not want to strip naked. There is a life after Google. The pendulum strikes back. Privacy is not over, it will be rediscovered as a high value because people have this need and politics absorb it – and there will be technical solutions to protect it in the digital age, see Blockchain technology.
And how do you assess the danger of monopolizing data and services in the digital age? You are sitting on the board of Facebook, one of the big tech giants.
If you want to succeed as a digital platform, you must aim for a monopoly-like position, which is completely clear. Otherwise, you rub yourself in the competition. But politics is picking up and starting to regulate, first in Europe, sometime in the US. As a libertarian, I have an even bigger problem with regulation than with monopolies that arise spontaneously on the market, but I think we are in a learning process here. It does not need regulation as long as the customers are satisfied with the service, their privacy is protected, they agree with the deal. The problem is that the Silicon Valley players are not generating enough benefit for the people here. The negative points outweigh very clearly at the moment. Because either the companies will satisfy their customers, or the policy will enforce rules with coercion, which should be customer-friendly, but in the end, experience shows that they are hardly.
Well, it could be argued much more fundamentally: to what extent do the Internet platforms at all contribute significantly to the improvement of the situation of ordinary consumers? Taxi rides or overnight stays are cheaper, but the customer loses more and more time on the PC.
You may be surprised, but I agree with you absolutely.
Do you dispute the innovative power of Internet companies?
Look: As soon as you cross the bridge to Oakland, you are in an area that is not affected by the technological boom of Silicon Valley. The streets are bad, the places look run-down. Also, take productivity rates in the US – they have remained consistently modest over the last few years. The economist Tyler Cowen put this finding in a nutshell in 2011: we have been experiencing a major stagnation in the West for some time now because innovation rates are constantly falling. We feel like we’re getting more and more productive and efficient, but the new digital gadgets are deceiving us that we’re finally going to site. And I think Cowen comes closer to the truth than Kurzweil, who is convinced that we would stand out and machines would fulfill all our wishes.
That almost makes you look like a techno critic.
I think I’m just saying what Joe’s average consumer has long known. Let me tell you a short anecdote. In 2012, I had a public debate with Eric Schmidt, the CEO of Google, in Aspen, Colorado. He told us how great everything is, how much technology improves our lives. At the time, I called him Google’s Minister of Propaganda. At that time I was possibly still a geek with my view. But who still seriously believes that the self-driving cars are just around the corner? That’s what they’ve been for ten years, and we’re still waiting for them. However, the fact is that many people at the end of the month hardly any money, although they use it sparingly and have a decent job – and then they ask themselves rightly: How can it be that I, I trained better than my parents , in this alleged paradise, in which everything gets better, daily in the hamster wheel, with no prospect of a lasting improvement in my situation?
They wanted to write a book about the technological standstill together with Garry Kasparov, it should be entitled “The Blueprint”. Why did not you write it when the thesis gnaws at you?
We started working on it, but at some point we realized that it’s incredibly difficult to measure stagnation. That’s a real philosophical problem. A feature of late modernism is the unstoppable division of labor and specialization. They have ever smaller groups of self-controlling experts. Only they know exactly what they are doing, only they can describe and measure it. It was simply impossible to find a common unit of measurement that was valid for all areas, to quantify technological innovation or stagnation. That’s why we eventually gave up the project.
You have found a slightly speculative measure that works approximately as it seems to me: the gut feeling of Otto normal consumers.
I trust the Common Sense on this issue more than the opinion of the experts. If you ask 100 people if their children are better off than they will, 80 will answer: no, never in life. And then you know that something is wrong with the numbers. These are not mere fancies, that is the knowledge from daily, hard experience. Numbers, on the other hand, can be styled. Just think about the shopping cart used to calculate the consumer price index. Not only are the real prices of products being consulted, but also quality improvements – when a new computer is suddenly faster, has more power and can perform more functions. Since the arbitrariness of the measurement door and gate open. And, of course, political interests are involved: the lower inflation is estimated, the better for politics. But what counts for the citizens at the end of the day is, whether they eat better, whether they can live more comfortably, buy a more beautiful house, have intact future prospects. And if you can not answer yes to these questions, but have a fashionable smartphone that you can not even serve, well, then do not trust any economist, statistician or politician more on the way.
Distrust among citizens towards business leaders and politicians seems to be on the increase overall in the West. Do you see a causal connection here – because people are first and foremost aware that there is a gap between the rhetoric of a world that is getting better and the reality of economic stagnation?
If my thesis is correct, then we touch here on the whole point. People would like to progress, but they do not see any. They struggle, and yet there is nothing left. This leads on the one hand to frustration, on the other hand to distrust of those who have it better. I would attribute the populist revolt that seizes the whole West mainly to it. It is not primarily about recognition and dignity, no, it is about simple, pure, hard economy.
They officially supported Donald Trump in his 2016 election campaign. Hand on heart: Are you satisfied with his performance, or do you regret your commitment meanwhile?
I continue to support him and I do not intend to change that. In my case, this is a package deal. I do not agree with everything, but he names problems and tackles them. And above all, he has opened up the diversity of opinion, that is the range of publicly admissible political positions, opinions and attitudes in all sorts of questions. This is clearly a progress of freedom.
Which problems do you mean exactly?
Rethinking illegal immigration was long overdue – either we have laws that apply, or we need to adjust the laws. But ignoring one’s own laws does not work in a constitutional state. Trump made trade with various countries, which is perfectly legitimate and in the US interest. He no longer kisses the Chinese, but has identified the Middle Kingdom as the most technologically, economically, and politically most powerful opponent. He encourages the NATO states to do their part and not simply rely on the US, which will pay and judge everything. Everybody I meet in Germany tells me behind closed doors: Of course we have to pay more for NATO.
That sounds too good. Where do you not agree with him?
I would like to answer in general: Everything is going too slowly. Trump really wants to reform the country, and that’s healthy. But it is still far too disruptive for my taste. However, one has to be fair to see how much resistance it receives from all sides.
From a European perspective, the diagnosis seems clear: Trump polarises and splits the country into two irreconcilable camps.
It is too cheap to blame politicians for all the hardships of this world. It is not they who are the people against each other. At best, they act as catalysts of polarization that is already in progress. And in my opinion, this polarization does not have to do primarily with the citizens’ different lifestyle, but with the economy. The divisive force is stagnation. There are many Americans who barely make ends meet. And they see the others skimming a pension. The former see their skins swimming away, they mistrust the profiteers of the system, they mistrust the establishment, they distrust politics.
They almost talk like a disguised Marxist.
Marx was a smart economist. His historical materialism was nonsense, but he made interesting observations. For him, there were the evil capitalists, who possess the productive forces, and the proletarians, who possess only their labor power. Well. The noteworthy point is that somewhere he said, if interest rates tend to zero, then it’s time for the communist revolution. For then the capitalists have no more ideas on how to invest their money productively. And here we touch upon a very fundamental question that concerns us all: can a Western-style democracy in the long run even work in a world without economic growth?
You mean – if there is less and less to redistribute and redistribute, then the political conflicts of different stakeholders with different interests are constantly increasing?
Exactly.As long as the cake grows, there is more for everyone, if only for some than for others. When the cake stops growing, the rules of the game change: what gets more, the others get less. This development has enormous potential for conflict. In the US, we have had fairly constant growth since the American Revolution, over the past 250 years. Europe, on the other hand, experienced a phase of stagnation in the 1930s. The institutions came under pressure, democracy eventually ceased to exist, and fascist or communist regimes came to power.
I would not have expected this comparison from you. You believe that the US is facing an authoritarian, even fascist era?
No, the fascists and the communists were youth movements, and our society is so obsolete that I do not recognize the slightest danger here. But the old and the young are more and more unforgiving, and the old are in the majority. The whole West is undoubtedly facing major political upheavals if the stagnation lasts longer. And the American president has understood just that. He is working to unleash the productive forces in the US, as Ronald Reagan once did. He deregulates the economy, he lowers taxes and at the same time increases public debt to pump extra money into the economy. Since he is ahead of most European leaders who fabulate a post-growth economy and seriously believethey could preserve the democratic institutions without economic growth. Forget it, these are fantasies.
There are also the fantasies of those who say we need war again, so we have to build something again. This is a view that more and more people are putting behind closed doors.
Anyone who says that is really lacking in imagination – in his luxury situation, he does not know what war brings with it suffering and destruction. And since 1945, when the first atomic bomb was dropped, every war can unleash such a destructive power that only the thought of it scares. We have weapons to blow up the planet several times, damn it again.
But you assume that we live in explosive, maybe pre-revolutionary times?
Not necessarily. Of course, the situation can explode – on the other hand it is also possible to sedate people, with bread and games, with drugs, with virtual reality, with streaming, with whatever. I am in favor of the legalization of drugs, but I see this point critically.
The anthropologist, who most recently dealt most intensively with human potential for conflict, is René Girard. You studied with him in Stanford. What did you learn from him about our political presence?
Man is the animal that constantly compares to others. Since we abolished the estate society, in which there was a natural, vertical order, comparing oneself has intensified in an outrageous way. One could say quite well, and we experience it every day: the more horizontal the society, the stronger the mimesis. The egalitarian society is absolutely toxic from the point of view of mimetic theory. Because when everyone compares to everyone, the rivalry increases, and consequently also the envy and thus the potential of the whole society for conflict. At the same time, however, we have developed morally. We do not live the rivalry openly but have defined rules of the game to channel the energies. Envy and morality somehow keep the balance – because they would not do it,we would long ago break our heads.
Girard holds a nice punch line for those who have dedicated themselves to total egalitarianism: The egalitarian society does not eliminate the conflicts, but even intensifies them.
There can be no reasonable doubt about that. At the same time, it is extremely difficult to argue against equality – if a politician ever does so openly, it would be political suicide. This is a great illusion of late Modernism: more equality makes us more peaceful. Girard keeps his finger in the wound, he has described in detail and analyzed that by comparing a social dynamic is set in motion, which causes just the opposite. A second point is added: the scapegoat component. Anyone who feels constantly reset and badly treated – and that is almost all by now – always blames a third party for his misfortune – the father, the politics, the system. René Girard is truly the philosopher at the height of time.
Let’s talk about identity politics. Against this background, it could be described as a machine that aims to perfectly manage social differences.
Identity politics has its roots in tribal thinking, but at the same time it is a product of our late modernity. Collective differences such as skin color, gender, ethnicity and sexual orientation are constantly asserted, just to point out that equal treatment among people has not yet been achieved. As a result, the differences between people are constantly deepening. We are returning to a kind of tribal society in a de facto egalitarian society in which all live side by side on equal footing. This is really crazy and confusing.
The US is a pioneer in this matter. Are you watching the development with concern – or with great serenity?
With serenity. The focus on this type of collective identity is based on a fundamental contradiction: on the one hand, group identity is what makes me unique and therefore different from all others; at the same time, it is what connects me to others who have the same ethnic or skin color. It is thus at the same time A and not-A. Eventually people will realize that both are not possible. The cognitive dissonance can not be sustained forever. But I do not think the whole question is ultimately decisive for the match. I wonder more of what the whole hype about identity politics wants to distract. And I have already given you the answer: of economic stagnation. I am always surprised that the leftists have not discovered the topic by themselves.
You are so friendly and give tips to your political opponents?
Sure, if it helps. No, seriously: The rights begins to take on the problem, not only in the US. And rightly so. The stagnation began in the 1970s. The Left then made a radical change without really being aware of it: economy was supplanted by culture, it was no longer about social but about cultural differences. Since then, the left has lost all economic expertise, having regressed to the level of children. The slow demise of the Social Democrats began at that time, the time of the Greens broke, so the time of the left-wing paternalists, others say how they can be good people and have to live well. If we want to understand what is happening today, we have to go back to the 1970s, and I am deeply convinced of that.