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<nettime> Guardian > Tarnoff > Donald Trump, Peter Thiel and the death of democracy


Donald Trump, Peter Thiel and the death of democracy

The problem with traditional conservatives is that they're too
anti-government to fulfill Thiel's vision. Fortunately for him,
Trump is no traditional conservative

Ben Tarnoff
 {AT} bentarnoff

Thursday 21 July 2016 06.00 EDT
Last modified on Thursday 21 July 2016 09.43 EDT

Tonight, tech billionaire Peter Thiel will speak at the Republican
national convention and make his case for why Donald Trump should
be the next president of the United States. Most of the media is
baffled by Thiel's endorsement. And it's true that at first glance
the two men aren't an obvious match. Trump is an authoritarian
populist who promises to abolish free trade. Thiel is a
self-described libertarian who worships capitalism. Thiel is also
one of the most powerful people in Silicon Valley -- and Silicon
Valley hates Trump.

So why would Thiel embrace Trump? So far, observers have offered
two explanations. One is Thiel's contrarianism; another is his
lifelong crusade against "political correctness". Thiel certainly
enjoys courting controversy, whether it involves funding a lawsuit
to destroy Gawker or funding a fellowship to induce kids to drop
out of college. And Thiel shares Trump's antipathy to the
"politically correct" rhetoric of diversity and multiculturalism,
as well as to affirmative action.

But neither of these reasons speak to Thiel's deeper affinities
with Trump. What Trump offers Thiel isn't just an excuse to be
contrary and politically incorrect. Trump gives Thiel something
far more valuable: a way to fulfill his long-held ambition of
saving capitalism from democracy.

In a 2009 essay called The Education of a Libertarian, Thiel
declared that capitalism and democracy had become incompatible.
Since 1920, he argued, the creation of the welfare state and "the
extension of the franchise to women" had made the American
political system more responsive to more people -- and therefore
more hostile to capitalism. Capitalism is not "popular with the
crowd", Thiel observed, and this means that as democracy expands,
the masses demand greater concessions from capitalists in the form
of redistribution and regulation.

The solution was obvious: less democracy. But in 2009, Thiel
despaired of achieving this goal within the realm of politics. How
could you possibly build a successful political movement for less

Fast forward two years, when the country was still slowly digging
its way out of the financial crisis. In 2011, Thiel told George
Packer that the mood of emergency made him "weirdly hopeful". The
"failure of the establishment" had become too obvious to ignore,
and this created an opportunity for something radically new,
"something outside the establishment", to take root.

Now, in 2016, Thiel has finally found a politician capable of
seizing that opportunity: a disruptor-in-chief who will destroy a
dying system and build a better one in its place. Trump isn't just
a flamethrower for torching a rotten establishment, however -- he's
the fulfillment of Thiel's desire to build a successful political
movement for less democracy.

Trump is openly campaigning on the idea that American democracy
should belong to fewer people. When he talks about deporting 11m
immigrants, or promises to build a database of Muslim Americans,
or praises FDR's internment of Japanese Americans during the
second world war, or encourages violence against black protesters
at his rallies, he's making an argument about who counts as an
American (native-born whites) and who doesn't (everyone else).
"Real" Americans get to enjoy the rights and privileges of
citizenship; racial outsiders and internal enemies do not.

This is certainly racist, and possibly fascist. It's also
profoundly anti-Democratic. It's debatable how many of Trump's
campaign promises he could actually fulfill if elected, and how
many he would even want to. But one indisputable effect of a Trump
administration would be to diminish American democracy by lending
credibility and resources to the forces of white supremacy and

Such an outcome would fit Thiel's purposes well. For Thiel, a
smaller, more easily manipulated mob is preferable to a bigger
one. If democracy can't be eliminated, at least it can be shrunk
through authoritarianism. A strongman like Trump, by exploiting
the racial hatred and economic rage of one group of Americans,
would work to delegitimize and disempower other groups of
Americans. He would discipline what Thiel calls "the unthinking
demos": the democratic public that constrains capitalism.

Limiting democracy isn't the same as limiting government, however.
And this distinction matters to Thiel, who believes that
government has an important role to play. Unlike most
libertarians, Thiel recognizes that only the state can provide the
public goods on which private profit-making depends. He often
speaks of his admiration for the Apollo space program, which he
considers the crowning achievement of a golden age of federal
funding for science. Since then, as he explained in an interview
with Francis Fukuyama, "an ossified, Weberian bureaucracy and the
increasingly hostile regulation of technology" have crippled
government's capacity to foster technological innovation.

Following this logic, what's needed is a state that bankrolls
scientific research at midcentury cold war levels -- without the
comparatively high tax rates and social spending that accompanied
it. Corporations would mine this research for profitable
inventions. The public would foot the bill and ask for nothing in

The problem with traditional conservatives is that they're too
anti-government to fulfill this vision. Fortunately for Thiel,
Trump is no traditional conservative. One of his talking points is
a trillion-dollar infrastructure plan, which he openly compares to
the New Deal. But if Trump is heretical enough to support public
spending to stimulate growth, he's orthodox on the question of who
should benefit from that growth. Federal spending is fine so long
as its benefits flow to the rich: Trump's proposed tax reform
would slash rates for the top 0.1% of American taxpayers.

Thiel's preferred political future isn't hard to picture. The
government shoulders the research costs for capitalists but makes
no demands and sets no conditions. An authoritarian leader uses
racial anger to set one portion of the population against another,
and cracks down on those he sees as alien or illegitimate. The
state becomes even more responsive to the needs of capitalists and
even less responsive to the needs of workers and citizens. What
Thiel calls the "oxymoron" of "capitalist democracy" is resolved --
by jettisoning democracy.

This may sound like dystopian science fiction, but it's also a
perfectly reasonable political objective for someone of Thiel's
class position. It's easy for liberals to dismiss Thiel as a
"comic-book villain", but this caricature obscures the fact that
Thiel is a sophisticated thinker -- and a perceptive one. His
central observation, that American capitalism is facing a crisis,
is unquestionably correct.

The past four decades of economic data make that crisis clear.
Since the 1970s, the US economy has enjoyed far lower levels of
growth than it did during its midcentury golden age. From 1920 to
1970, real per-capita GDP grew by a staggering 2.41% a year on
average. From 1970 to 2014 it slowed considerably, to 1.77%. The
slowdown in labor productivity has been even starker.

Thiel is acutely aware of these numbers. He is, in fact, obsessed
with economic stagnation. Over the long term, stagnation doesn't
just threaten capitalism by limiting growth; it also runs the risk
of turning people against capitalism, as their wages and living
standards deteriorate. This is already happening, as the
popularity of the Bernie Sanders campaign made clear. A Harvard
survey from April found that a majority of millennials now say
they reject capitalism; a third say they support socialism. The
precise meaning of this poll is arguable, but it's clear that
young Americans, who make less money than their parents did at
their age and have higher rates of poverty and unemployment, are
moving left.

It's safe to assume that Thiel is paying attention. The next
American electorate will be more nonwhite, more working-class, and
more leftwing. And they're likely to demand more democracy, not
less -- not only from the political system, but from the economic
system as well. That sets them on a collision course with elites
like Thiel.

Above all, Thiel is an innovator. He has made his fortune by
recognizing the potential of an idea long before his peers.
Silicon Valley, along with most of American business, may dislike
Trump. But that doesn't mean they couldn't someday embrace the
kind of politics he represents. A Trumpist state could do much to
soothe the crisis of capitalism: it could pour public dollars into
discovering the next lucrative technology for the private sector
while holding the line against the redistributive clamor of a
rising millennial majority. Thiel has a history of making bets
that pay off big. With Trump, he may have made another.

© 2016 Guardian News and Media Limited or its affiliated
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