Interesting thoughts from a guy who made some very serious money betting on technology . . .
Utopian Pessimist Calls on Radical Tech to Save Economy | MagazineEmphasis added. . .
Wired: You say that we have big problems in the US economy and that investors have unrealistic expectations. We’ve certainly been through a major crisis, but over the long term the stock market seems to grow fairly reliably.
Thiel: People take it for granted that their retirement funds can earn 8.5 percent a year. That’s what their financial planners tell them. And sure, you look back over the past 100 years, the stock market has generally gone up 6 to 8 percent a year. But in a larger historical perspective, that kind of growth is exceptional. If you had done the equivalent of investing in the stock market from, say, 1000 to 1100 AD, you would not have made 8 percent a year. During the fall of the Roman Empire, you’d have been lucky to get zero. We’ve been living in a unique period of accelerating technological progress. We’ve gone from horses to cars to planes to rockets to computers to the Internet in a very short time. It’s not automatic that that continues.
Wired: What happens if we don’t get the growth everyone expects?
Thiel: If it doesn’t happen, people will go bankrupt in retirement. There are systemic consequences, too. If we don’t have enough growth, we will see a powerful shift away from capitalism. There are good things and bad things about capitalism, but inequality becomes completely intolerable to society when everything’s static.
Wired: You’re worried about economic stagnation, but you’re optimistic about artificial intelligence and space?
Thiel: I think we have to make those things happen. We should be looking at technologies that might lead to really big breakthroughs. As a starting point, let’s just go back to the science fiction novels of the 1950s and ’60s and try to run the past 40 years again.
Wired: We need underwater cities and flying cars, otherwise we’re going bankrupt?
Thiel: We go bankrupt if radical progress doesn’t happen and we don’t realize it’s not happening. That’s a dangerous combination.
Wired: We’ve had tremendous growth in the Internet, which is how you made your fortune. Why not look there?
Thiel: Obviously we’ve done well online. But how much more progress is there going to be? How many big new Internet companies are there? In the ’90s we had Netscape, Yahoo, eBay, Amazon. In the past eight years there have been only two: Google and Facebook.
Wired: Twitter?
Thiel: Possibly. Still, the numbers suggest a maturing industry. The Internet may be culturally important, just as the automobile was culturally more important in the ’50s than the ’20s, as we got suburbia and built the Interstate Highway System. But the last successful car company started in the US was Jeep in 1941.
