Back to the Future with Peter Thiel
The hedge-fund billionaire says we need more innovation — and less herd-thinking — to open a new frontier.


Peter Thiel may be most famous for his role (portrayed by Wallace Langham in The Social Network) as the venture capitalist who gave “The Facebook” the angel investment it needed to really launch. Before that, Thiel was known in Silicon Valley circles as the “Don of the PayPal mafia,” (his official role at the e-commerce site was founder and CEO), and more generally for his centrality as an investor in tech startups. Now, Thiel serves as the president of Clarium Capital, a hedge fund that (though it has suffered recently) made extravagant gains by betting against the housing market in 2007.

Though he’s primarily a businessman, Thiel has dabbled in libertarian activism. Most recently, he caused a stir by establishing the Thiel Fellowship, which will select 20 college students under the age of 20 and pay them $100,000 each to drop out of college and embark on entrepreneurial careers. Thiel is also an intellectual of astonishing breadth and depth who finds time, while running a major hedge fund, to produce thought pieces that survey the Western Canon, the geopolitical landscape, and financial economics at a gallop (such as this one for the Hoover Digest).

NRO’s Matthew Shaffer spoke with the philosopher-CEO in a wide-ranging conversation about net neutrality, the higher-education bubble, the future of seasteading, income inequality, why the wealthy have gone blue, Leo Strauss, and more. Thiel wants to take us back to the future, to once again, like in the 1950s, imagine how innovation — technological and otherwise — can radically improve our lives.

matthew Shaffer: As a major investor in a number of online startups, what are your thoughts on the recent push for net neutrality?

PETER THIEL: There’s something very odd about it. It does seem like an attempt to use the political system to reapportion property rights. Along those lines, one should be extremely skeptical of it. We’ve been having this debate for 15 years. The arguments have not changed very much during that time. Net neutrality has not been necessary to date. I don’t see any reason why it’s suddenly become important, when the Internet has functioned quite well for the past 15 years without it.

shaffer: So far, it’s been a solution without a problem. But is there a future in which big Internet providers have a realistic incentive to abuse their property rights in broadband?

THIEL: The model where Internet companies have enormous power that they abuse in various ways depends on a view of the Internet as a fundamentally static thing where nothing changes much. That might become an issue at a point where it’s an extremely mature industry, but that’s not the way most people think of it now. Until it is a mature industry, we have no idea where real abuses would be. As a policy matter, from a government perspective, not only would you have to decide that it’s mature, you also would have to decide that you knew exactly how to reallocate these property rights.

Government attempts to regulate technology have been extraordinarily counterproductive in the past. The antitrust lawsuits against AT&T and IBM in the ’70s, Microsoft in the ’90s — it turned out that all these companies eventually saw tremendous competition within the technological space. Technology, to the extent that it is changing a lot, is an area that is extremely difficult to regulate, because it’s not like you have some incredibly entrenched interests that are somehow systematically distorting the field. (Even if there were interests distorting the field, I’m not sure you should regulate it.) That’s almost by definition impossible, because technology involves areas of tremendous change.