Peter Thiel’s Blind Spot: What He Gets Wrong in Zero to One

Below is a quick comment that I’d written in maybe 2017 or 2018, and published on another blog that I was, again unable to maintain. Now that I have this blog set up, and am committing to maintaining it well (let’s see how it goes), I figured I’d start by reposting this old article.

Like most of you working in tech and startups, I absolutely loved reading Peter Thiel’s Zero to One. It’s a stunningly thought-provoking book, with a deep new insight pretty much on every page. It’s hard not to be impressed by the clarity of thought as well as the originality of the ideas in the book. This is probably one of those books that I’d go back to frequently, maybe once every couple of years or so.

I’m a little embarrassed that it took me to long to get to this book, actually. I’d heard about it of course, but never quite gotten around to reading it. That was a mistake, and I’m glad I eventually did read Zero to One. I have mostly positive things to say about it, but I’m not really going to go into those, because, frankly, many people have reviewed and discussed the book, and I’d hardly be adding anything new to this discussion.

But I do have one piece of criticism to offer. It’s relatively minor in terms of the overall import and relevance of the book, and does not invalidate the insights and opinions that Peter Thiel expresses, but still very important if you consider the overall global perspective.

I found Thiel’s proclamations regarding our history short sighted and reductionist, and quite  uninformed. And they reek of a Western-centric bias. Let me explain.

In the very first chapter, Thiel proclaims:

“New technology has never been an automatic feature of history. Our ancestors lived in static, zero-sum societies where success meant seizing things from others. They created new sources of wealth only rarely, and in the long run they could never create enough to save the average person from an extremely hard life. Then, after 10,000 years of fitful advance from primitive agriculture to medieval windmills and 16th-century astrolabes, the modern world suddenly experienced relentless technological progress from the advent of the steam engine in the 1760s all the way up to about 1970. As a result, we have inherited a richer society than any previous generation would have been able to imagine.”

This passage strikes me as odd, Western-centric, and blithely unaware of Western colonization and its devastating effects around the world in the course of a few hundred years. There is clearly a lack of self-awareness here.

Thiel assumes that prior to industrial revolution the average person led an ‘extremely hard life’ without specifying what that means. How was this life hard? How do we know this with certainty?

As Yuval Harari’s Sapiens: A Brief History of Humankind points out, tribal and hunter-gatherer communities, relying on almost no technology (or not, at least, on industrial scale technology), lived in far greater comfort than peasants in agrarian societies. An argument could be made, therefore, that the hardships of our ancestors came about, in large part, due to our ‘primitive agriculture and medieval windmills.’ Because of technology, in other words, rather than due to its absence. Also, as accounts of life in Victorian, industrial England and London in particular show, technology and industrialization definitely had an immediate adverse impact on people’s lives. Not necessarily all classes and races of course. But children suffered slavery and child labor, and it’s well-known that living conditions in industrial towns were terrible. I mean, we’ve all read our Dickens, so we know how things really played out. What drove people to these terrible, 20-hours a day jobs, where entire families, from toddlers to grandparents labored away endlessly? Was it really the opportunities created by technology that drove people to these jobs? Or was it the lack of other opportunities and the destruction of traditional livelihoods?

Across the pond, things didn’t play out very differently as industrialization spread. The Chinese origin workers laying the railroads had it rough (to put it mildly), and other races of course didn’t fare much better either. This little clip from Blazing Saddles captures that ethos perfectly:

Thiel’s understanding of the the economics of the ancient world in particular is strikingly Western-centric and lacking in self-awareness. Our ancestors, he says, ‘lived in static, zero-sum societies where success meant seizing things from others,’ and they ‘created new sources of wealth only rarely.’ Let’s spell that out: Till about 1760, according to Thiel, people stole rather than created wealth. That means wars and violence, rather than trade and industry. And somehow, after 1760, people (and by implication white, Western people) figured out how to generate wealth rather than steal it, by harnessing technologies such as the steam engine.

While making this sweeping statement, Thiel completely ignores the whole phenomenon of Western colonization: the biggest land grab in human history, the biggest captive labor force, institutionalized, industrial-scale slavery, and two of the biggest and deadliest wars in history fought as a result of this very colonization. There is simply no way to deny that from 1760 (or a little before) to all the way till 1960s, most of the Western world was focused on ‘seizing things from others.’ The Western nations probably created wealth too, I’m not economist enough to go into that, but there is a wealth of data out there that shows they also stole a lot of the wealth that powered their prosperity. Shashi Tharoor, for example, presents a clear perspective, and precise data, to highlight Britain’s severe depredations in India.

The upshot? Much of the industrial revolution was in fact financed by ‘seizing things from others.’

There is probably a German word for this phenomenon where you are biased towards the present and towards your own (race, cultural context, or location), and find things in the distant past to be wrong while blindly approving of the things closer to your location in time and space.

In any case, it struck me as odd that Thiel can ignore any number of armed conflicts including two world wars, slave trade, genocide, and centuries of colonization (with the entire colonial enterprise being focused on stealing wealth), and proclaim that the Western people figured out, for the first time in history, how to create wealth during the industrial revolution.

Taking a very charitable view, I’d say Thiel’s understanding of History and Economics is somehow off the mark if he understands wealth creation in such a narrow way.

But what really concerns me is the very casual acceptance of the colonial enterprise. I find it just a bit disappointing that Thiel, who is otherwise extremely self-aware (as the rest of the book shows), should have this blind spot of a Western-centric perspective.

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