Part Two: How Peter Thiel Became the Gravedigger of Democracy

We discuss Peter Thiel's rise to PayPal CEO, his betrayal of Elon Musk, and the birth of the technology that became Palantir.

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Episode Transcript

Speaker 1 (00:01):
Also media.

Speaker 2 (00:04):
Welcome back to Behind the Bastards, A podcast is entirely
funded and supported by the film Alien Resurrection, which no
one on this call but me has seen. I have
picked a bit that no one can play off of
because they simply don't remember the classic Ron Pearlman film
Alien Resurrection. What a tragedy. Speaking of works of artes, no,

(00:28):
I was gonna say works of arts. No, No ashactment
contributing editor for Rolling Stone and Wired, How are you
doing today?

Speaker 3 (00:42):
I'm doing sad better than a astronaut with an alien
implanted into my gut? Question? Yeah, does that's that's? Does that?
Does that take place in that movie?

Speaker 2 (00:56):
I guess they if you consider anyone who's in space
an astrona yes, yes, I okay, then yes, yes, that's
essentially what's going on in that movie. There's a lot
of cloning involved, though, which you know, fingers crossed. Would
you clone yourself if you could? You know? Absolutely you would?

Speaker 4 (01:16):
Okay, absolutely, because then I could have somebody else do
my job twice, even though I know that's not on how
that works?

Speaker 2 (01:23):
Wow, yeah we could.

Speaker 3 (01:25):
If you've writ any Spider Man comics, it never goes well.

Speaker 2 (01:29):
No, m M and I do think that Spider Man
comics really really are the that that's where I go
to for maya all of my cloning related information, specifically
Spider Man.

Speaker 3 (01:41):
I should work for a guy that had cloned dogs. Really.

Speaker 2 (01:45):
Yeah, oh that's so weird to me.

Speaker 1 (01:48):
I would never clone my dog. I love my dog,
but it wouldn't be her. I know it wouldn't be her.
I'd be like, who's this impostor not Anderson?

Speaker 2 (01:58):
Yeah, I don't know.

Speaker 3 (01:59):
Folks yourself, but not your dog.

Speaker 2 (02:01):
Yeah.

Speaker 4 (02:01):
For efficiency purposes, you just want somebody that could sit
in the meetings I don't want to go to or
sit in do like all the work things that don't
appeal to me, and then I could just do the
things I want to do.

Speaker 3 (02:14):
So the clone would have to grow up to be
exactly your age and then slow down.

Speaker 2 (02:20):
Yeah, okay, you would have to like accelerate its growth
really rob it of a childhood or you're or you're
doing a clone like in that? Well yeah, so are you?
You do not think clones are people, Sophie, because that's
a very problematic attitude to have. Year I'm like, it's
not real.

Speaker 3 (02:38):
Yeah. Yeah, again, the Spider Man books would would tell
you this is this way lies madness.

Speaker 1 (02:45):
Well, it's absolute madness.

Speaker 2 (02:47):
There's no if we get cloning at the same period
of time, we get like Peterteel's ideal, like breakdown of
federal power so that like there's all these isolated city
states run at the whims of rich people. There's no
way we will not get someone like acting as a
wellness influencer who starts an island where you can go
hunt and murder a clone of yourself in order to

(03:08):
gain like unspecified mental health benefits. That's absolutely going Like
Joe Rogan is going to kill his clone in order
to gain its power by eating its heart. That's a
version of the future that could be us in ten years. People.

Speaker 3 (03:22):
I feel like that's just called Austin, Texas.

Speaker 2 (03:25):
Yeah, it could be in Austin, Texas. I would say
that's not a bad place to set.

Speaker 3 (03:28):
It, Like I feel like that's happening right now. Yeah, yeah, yeah.

Speaker 2 (03:32):
I mean I killed a guy in Austin, Texas once
who looked a lot like me, but that was less
out of a desire to gain better mental health. And anyway, Noah,
you ever killed me, buddy.

Speaker 3 (03:48):
Not that I can talk about. On this podcast.

Speaker 2 (03:50):
Well that's the answer Peter Teal would give. I'm sure,
and we are getting back to Peter's story. Up to
this point. The Teal story is the tale of an isolated,
super disciplined kid who didn't connect with his classmates, or
at least that's one version of it, right. I will say,
I don't know if that's right, because this vision of

(04:13):
this kid who just like doesn't understand or get along
with other people and it's like separate from them, is
at odds of a kid who hangs out with Judge
Kennedy's son because he wants to clerk for Justice Kennedy,
who socializes with the Federalist Society people, and who starts
and operates a student newspaper with several friends. Right, that
version of Teal reads less like lonely victim of bullying

(04:36):
and more maybe kind of a rich kid asshole who
doesn't like to be associated with regular people. Right, It's
not so much that he's lonely and separate, it's that
he has separated himself because he wants to be better
than them. Right, I don't know which of these. Yeah,
you can really make a case for either. If we're
going for that latter interpretation of Teal. It makes sense, then,

(04:58):
to draw a line from his the old ambitions as
a lawyer and his anger at the higher education system
that had evidently prepared him poorly to succeed in his
first ambition. Stanford had not made Peter into the kind
of person who could clerk for the Supreme Court, and
since that could not be representative of a fault of Peter's,
maybe he just literally wasn't good enough. It has to

(05:19):
have been the fault of higher education as a system,
and Peter has made his anger at this everyone else's
problem for the last forty years now. The other open
question here is how did being gay influence Peter's development
and the nation state sized chip on his shoulder. In
twenty eleven, a writer for The New Yorker asked Peter
more or less that same question, how did his homosexuality

(05:42):
and status as an outsider influence the way he thinks
about politics and business today? Here's his response. I can
come up with stories about how they're factors, but I'm
not sure that they're interesting. The gay thing is that
you're sort of an outsider. There are things about it
that are problematic. There are things about it that can
be positive, but it also contrived. Maybe I'm more of

(06:02):
an outsider because I was a gifted and introverted child.
Maybe it's some complicated combination of all these things. And
maybe I'm not even an outsider. And I think that's
interesting where he's like, maybe I'm just kind of full
of shit with you people, and like I've always I've
never been an outsider. I just think I'm better than you, right,
And a lot of this is a crafted image of

(06:23):
like this is a more sympathetic vision of me, right,
Like he definitely has it takes some joy in playing
the mastermind manipulating the media and yeah.

Speaker 3 (06:36):
Yeah, no, I mean clearly not. And yeah, or maybe
it's like maybe it's a bit to appeal to actual outsiders.

Speaker 2 (06:43):
Right, Yeah, maybe it's a bit to appeal to, yeah,
the real ones. One thing you can say about Peter
is that very shortly after starting his career in law,
he decided I don't want to be a lawyer. In total,
his career consistent of he clerks for a judge in
Atlanta for a little while, and then he becomes a
first year associate at a corporate law firm, and he

(07:03):
never makes it to year two, so he just kind
of hates the thing that he had studied to do
in school. It seems like he hates it largely because
he's not going to get a shortcut to being at
the top of that. If he's going to get anywhere,
he's gonna have to work himself up from maybe not
the bottom, but like the middle. And Peter just doesn't
have any interest in doing that. That's a regular life,

(07:25):
that's an ordinary people kind of thing to do, is
like starting it kind of the bottom rung of your
career and working your way up. He doesn't want to
have to do that, so he leaves this profession to
start trading derivatives. Right, what's the thing you do if, like,
you know, you want to feel like you're better than
everyone else, Try to get into finance and get mega rich. Right,

(07:46):
That's his next move is like, well, law isn't going
to be the thing I wanted, so I'm going to
try to get wealthy and the financ this is not
going to work out immediately well to him, right, And
the fact that finances, you know, the thing that he's doing,
but it's not his first career choice, seems to rub
him the wrong way, and this is when we first
get outside evidence that he's built a grudge against higher education.

(08:09):
In the late nineteen nineties, he gets together with a
friend from his Harvard Review days, David Sachs, and co
authors a book called The Diversity Myth, which was published
in nineteen ninety five by the Independent Institute, a right
wing think tank that made Peter a fellow. During this
awkward period in his career, he was hard up for cash.
His investment business isn't going well. He's not making money

(08:31):
as a lawyer. The think tank gives him income. It
helps him in David Sacks secure a series of op
eds in The Wall Street Journal mocking things like Indigenous
People's Day and a broad side against multiculturalism that was
anti Western. Their book, which was endorsed by Denesh Desuza,
had been funded in part by a forty thousand dollars

(08:51):
grant by the John m Olin Foundation, a conservative nonprofit
geared towards creating a counter intelligensia that had also bank
rolled some of Dessuz's Earth career. Peter got to do
a book tour and a series of speaking engagements, and
he found that he enjoyed aspects of life as a
right wing intellectual. And this is really interesting to me
because Peter doesn't start as a founder and gets successful

(09:16):
in business and then pivot to right wing politics. He
is scouted by right wing like moneyed interests, by these
guys working at think tanks and nonprofits funded by like
oil and gas billionaires and the like. He is scouted
as this is a smart kid who is frustrated because
the first thing he wanted to do didn't work out

(09:37):
for him. We could get him into right wing politics.
Right he is a conservative pundit before he starts funding
conservative causes. And this is a part is.

Speaker 3 (09:48):
The opposite of what I thought the origin story was.

Speaker 2 (09:51):
Well, it's so interesting because this is how for decades,
if we want to ask the question, how did right
wing politics get so deranged? How do the Republican Party
get so deranged? Well, it's because of this decade's long,
very dedicated, methodical effort to every time we can find
an angry young man with a degree of like skill

(10:14):
and talent who has failed out of their first ambition,
let's put a pile of cash in the front of
their face and say, like, hey, do you want to
get into conservative media? Right that's where all the Daily
Wire guys come from, their failed Hollywood screenwriters and standard comedians, right,
that's where Teal gets into this from he is a
failed lawyer. Yeah who and they're like, hey, come be

(10:36):
our Danchet Suza, right, like, come be another Daneshta Susa.
That's his Like yeah yeah. And in fact, Peter, while
he's kind of like having this flirtation with being a
right wing intellectual, he tries to start a Bay Area
public access talk show with a liberal friend of his,
which biographer Chafkin describes as Crossfire, but way way more pretentious.

(10:58):
And I can't imagin that, Like, can you get what
is a more pretentious crossfire that even exists with.

Speaker 3 (11:07):
Like mid nineties production value? God?

Speaker 2 (11:11):
Yeah, yeah, like a fucking uhf crossfire? Incredible shit. I
desperately wish they'd gotten out like eight episodes and those
were on YouTube for me to just watch. I want
to see Peter Teal's take on Crossfire.

Speaker 3 (11:29):
No you think you want to see?

Speaker 2 (11:32):
No, I for sure don't.

Speaker 3 (11:34):
Yeah, you would definitely gouch out at least one, if
not both eyes.

Speaker 5 (11:38):
Yeah, but.

Speaker 2 (11:41):
That's true, but not too not to no one does
so Teal in Sachs's book becomes a foundational work in
the complaining liberals on campus are intolerant genre. Right, these
are that's a big part of conservative media today, intolerant
liberals ruining college I mean, mean to conservatives, and Sacks
are doing this in the nineties. Right. It is also

(12:03):
an early work of DEI panic.

Speaker 3 (12:06):
Right.

Speaker 2 (12:06):
This is really where Chafkin gets a lot of credit
for me, because most of the articles that I read
which talked about this period in Peter's life mentioned that
he'd co written The Diversity Myth, but they just described
it as a book Peter and David Sachs wrote because
they were so frustrated. Right, This genuinely came out of
a place of we were so angry about what we
saw at Stanford that we just had to write this

(12:27):
book about, Like, this is real problem we saw coming
up from higher education, all these fucked up things on
campus that we just couldn't ignore anymore. And that's not true.
The reality is that the Diversity Myth and the ideological
careers of David and Peter were crafted, molded, and funded
by powerful moneyed interests looking for fighters to help them

(12:49):
tear down the liberal status quo. And chief among the
bugbears of these moneyed interests was people who thought that
other cultures should get to exist in American intellectual life. Right,
That's what made these rich guys angry, and they hired
people like Peter in Teal to yell about it. Now
the books, yeah, yeah, fascinating shit. The book's Amazon description

(13:12):
informs us the authors convincingly show that multiculturalism is not
about learning more, it's actually about learning less. Now, if
you read there's a fun article, because this has become
like the modern you know, this is also like most
of conservative politics today. Teal got to write an article
about this book he wrote as a young man for

(13:34):
a website called The New Criterion in twenty twenty three,
which is, you know, coming out just as this panic
that he and David had really tried to start much
earlier over multiculturalism on campus became integral to conservative politics.
So Peter goes in and basically does like a victory
lap I was right all along, And he lists his
examples of progressive mania that he saw in Stanford as

(13:56):
the replacement of Shakespeare's The Tempest and One Class with
a play that had been written by a modern author
based on the tempest. The inclusion of other works beyond
the Western classic literature canon was, in Tel's eyes, a tendentious,
left wing anti Western crusade, as opposed to just like,
I don't know, man, maybe maybe it's good at a

(14:17):
certain point to add in works that are influenced by
and based on some of these like classics, instead of
just having everyone read these classics, you know, ad nauseum.
There's an intellectual value in discussing the works that they inspired.
That's kind of accepting that art and creativity is a
living sort of thing, as opposed to just being like, no,
everyone just needs to memorize the Iliad. Well, maybe we

(14:40):
could talk about some of the works that were influenced
by it and you know, that have descended as a
result of it, because that's just kind of how education
ought to work. At one point, listing examples of how
progressive madness had warped educations at Stanford, Teal complained that
the campus refused to seal off glory holes during the
height of the AIDS epidemic. Now, I don't know if

(15:02):
this is true. I have not found any outside evidence
that this is a thing that happened in that twenty
twenty three article. Tiel does make a couple of valid points.
He complains about the insane increase in tuition costs and
how that's a part of the housing crisis. And he's
not wrong there, right, Like the fact that so many
people are in educational debt is part of why it's

(15:22):
hard for them to afford housing and to like buy
houses of their own. But what he's what he's doing
here that's fucked up is he's rapping decisions made by
people who aren't teachers.

Speaker 3 (15:31):
Right.

Speaker 2 (15:32):
Teachers are not choosing to make college this expensive, and
they are not the primary financial benefactors of college being
that expensive, right, It is the administrators of the school.
It's not like your history professor isn't deciding what, like
the campus is going to charge people for credit hours,
you know.

Speaker 3 (15:51):
Yeah, the glory whole thing is just is also just.

Speaker 2 (15:55):
Like I feel like it's just bullshit. I feel like
it's just bullshit. Yeah, I feel like there were probably
a couple of glory holes on campus maybe, but like
I don't feel like the student the school was like, no,
we love our glory holes. We're keeping those in.

Speaker 3 (16:09):
It's bananas. And then also, I mean it is a
little bit bananas that this guy was like confronted for
being kind of like pro apartheid South Africa by black classmates. Yeah,
and then his solution is what that it was bad
to have any diversity on college.

Speaker 2 (16:31):
It's bad to have any diversity in like the course material.
If you're doing a Western class, you should only be
reading old, dead white men as opposed to like, well
number one, Western civilization includes a lot of people who
are not white and exists up to the present day.
So it's actually very valid to say, like, Okay, Shakespeare
is obviously part of the Western canon. Can should we

(16:54):
not also be looking at like some non white authors
who are in the Western canon who are right and
pivoting off of works started by Shakespeare and influenced by him?

Speaker 3 (17:04):
Right?

Speaker 2 (17:04):
Is that not a valid part of art education? Which
I would say, well, yeah, that just seems like what
you do?

Speaker 3 (17:10):
You know, I just do not believe that this guy
is actually this angry about it.

Speaker 6 (17:17):
No.

Speaker 2 (17:18):
Well, and that's part of why I really appreciate what
Chafkin does here, because like, once you read like, oh
and all of this was funded by some like shady
right wing think tank that gave them forty grand to
write a book to like because the funders hate colleges
and liberal professors. Oh okay, so this is made up, right,
Like you were paid to be angry about this. That

(17:38):
plays a role in why Peter is doing all of this,
for sure, last the late nineteen nineties demanded more of
Peter than a full time devotion to the culture war trenches.
After quitting his law career, he'd been forced to live
with mom and dad for a while, which I think
was a miserable experience for him, and then he'd finally
managed to get himself set up in a shitty little

(17:58):
apartment thanks to all of those think tank paychecks. Peter
was not happy with this life. He was not about
to live as a poor man or even just a
moderately comfortable conservative intellectual. He wanted to be one of
the rich founders, plucking a young, angry man like he'd
been from obscurity and funding them in their quest to
write bullshit. And in order to become that kind of guy,

(18:20):
the only way to make the money he needed was finance.
So he decides he's going to launch a hedge fund
from his friend with a friend from his magazine days
at Stanford using money that he had begged from friends,
family and friends of family. Now, he'd been trying to
trade derivatives up to this point, and that had not
made him a bunch of money. The fact that he's

(18:40):
able to get enough money from friends and family to
start a hedge fund is evidence again, this is not
a poor kid. This is not even a middle class kid, right,
No matter what a lot of provoles came from a
middle class family. I'm sorry if your family has enough
money for you to start a mutual fund with their
donations or hedge funds, sorry, like that's you know, you're

(19:00):
not necessarily like millionaires, but your family and friends are
of a different certainly, Like if I had wanted to
start a hedge fund at this age, my family and
friends would not have been able to pay into it
right like they were struggling to pay rent. Peter was
not initially good at running a hedge fund. In his
first year operating, the Nasdaq went up by forty percent,

(19:22):
and Peter's fund lost money betting instead on currency. Part
of this is because this is something Chafkin points out,
Peter's kind of obsessed with George Soros, and George I
think kind of around the time Peter's getting into hedge funds,
makes a fortune shorting the British pound and like kind

(19:43):
of fucks up the currency of an entire nation with
his you know, his betting right, and Peter both hates
Soros because they're very different ideologically, and also wants to
be like him because he sees he wants that kind
of like Soros is this right wing bugbear, this monster

(20:03):
in their nightmares, and Peter wants to be that for
the left right. So he's betting on currency, but he's
just not any fucking good at it right. So it
gradually dawns on Peter that he probably isn't going to
earn a reputation as one of the great hedge fund founders.
And while he struggles with this, he watches the news,
which is endlessly celebrating this is the end of the nineties, now,

(20:26):
this parade of stories about guys like Marc Andreesen who
made early dot com fortunes. Peter's obsessing over this, and
he's supplementing his income with lectures at Stanford, so he's
writing about how evil the higher education system is and
also reliant upon it for some of his money. When
in nineteen ninety eight at Stanford, he is a run

(20:46):
in with someone who would be a crucial part of
the next and most profitable phase of his life. This
someone's name was Max Levchin, and Max was a twenty
three year old student at Peter's alma mater who showed
up one day for a lecture on currency. The two
hit it off and wound up talking about Peter's hedge fund.
Max mentioned that he was considering an investment in a

(21:07):
company that made software for palm pilots. Now, no, you
know what a palm pilot was? Yes, I think we
I have to step back and explain this for our
zoomer audience because they're not going to have any fucking
idea what I'm talking about. Imagine a smartphone that can't
call people, or text people or like map your way

(21:27):
to you know, it doesn't have a GPS. You also
you can't message in it. You can't like use the
Internet at all really on it in most functional ways,
and there's not any games on it. It also doesn't
have a camera. Basically, it's a small computer that keeps
track of your calendar and if you can find out
how to download a book in nineteen ninety eight, it
can kind of be a shitty e reader, right, those

(21:49):
are the things that palm pilots are doing at this
point in time.

Speaker 3 (21:52):
Those are also one of those things like you had
to use one of the like it's got to stainless.

Speaker 2 (21:57):
Yeah, oh, they're fucking they're awful. It really is like
Steve Jobs hated the palm pilot because he very rightly
was like, this is never going to take off as
a product because it sucks. It's a piece of shit.
The only people who like these are like people with
disposable income who like want to impress folks by having
an electronic gadget that most people don't have. Right, they're

(22:18):
just now that there's not uses for all palm pilot,
But it's not an indispensable device in the same way
that a smartphone will become, right, Like, you really can't
exist in a lot of the modern economy if you
don't have a fucking smartphone. Palm pilots are never that.

Speaker 3 (22:33):
But indispensable. However, in masturbation.

Speaker 2 (22:36):
Jokes, yes, yes, also also that right, that was Oh god, yeah,
what a time that was. They really laid that one
up for us perfectly. Yep, So Palm pilots are a
dead end tech wise, but they also are They're not
a failed product entire They do make money for a while,
and there's there's a lot in Palm Pilot development that

(22:58):
is going to feed in later to smartphones and the
smartphone app ecosystem, right, and that's going to be relevant because,
like Max and Peter, they start talking about, like we
want to create like an app for Palm pilot users,
and specifically initially what PayPal is is Max and Penier
being like, what if PalmPilot users can send each other

(23:19):
io use, right, Like what if there was a way
to do that? And Peter's his interest kind of evolves
into what if we use Because they're looking at the
internet and palm pilots have some ability to connect. It's
a nightmarish pain in the ass compared to just like
the way your smartphone works, they do have a way
of connecting. Peter is start is starting to look at

(23:44):
this digital infrastructure that's being built up in this period,
and he gets this. He gets this fascination with the
idea of what if we create a digital bank that
can separate money from the state, Right, So he sees
PayPal not as just a business, but as an act
of revolutionary praxie. If we're looking at like Peter as

(24:06):
like a capitalist Lenin, this is his equivalent of like
the banks that Lenin had Stalin rob in order to
fund the revolution. Right, PayPal will allow us to take
money from the state and build up our own war
chest in order to destroy this liberal nanny state and
create our libertarian paradise. It's a weapon, right, Peter sees

(24:27):
PayPal as a weapon time. Yeah, that is what he claims.
I can't tell you what he believed at the time.
All the reporting on him, and this is what people
who knew him said, is that like, yeah, he saw
this as like this is a way to separate money
from the state. So I think it is probably credible
that he sees this as an act of kind of
revolutionary praxie.

Speaker 3 (24:49):
Wild. Yeah.

Speaker 2 (24:50):
In a two thousand and seven article for Fortune Magazine,
Jeffrey O'Brien wrote, Teel figured a web based currency would
undermine government tax structures. Getting there, however, would mean taking
on established industries commercial banking, for instance, which would require
financial acumen and engineering expertise. That's one of the earlier
Like this is a revolutionary thing for him, Right, I

(25:12):
want to undermine the government by building this web based currency.
And obviously that's not what PayPal becomes. PayPal is just
a way to like send your friends money. You know,
it is not separated cat. But also Peter is not
involved in PayPal after he sells it, as we'll talk about.

Speaker 3 (25:28):
Right.

Speaker 2 (25:29):
So one benefit of founding a company like PayPal was
that Peter and his partner could bring into work for
them anyone they wanted and exclude anyone who annoyed them.
And as soon as the company gets off the ground,
it becomes clear that, like this is non negotiable for Peter, right,
Like A big reason why he likes the idea of
being a founder is he can kind of make his

(25:50):
own clubhouse and say no girls allowed.

Speaker 3 (25:53):
Right.

Speaker 2 (25:53):
And that's more literal than you might think. I'm gonna
read something that Levchin told Forbes in that two thousand
and seven interview. This guy came in and I asked
what he liked to do for fun. He said, I
really enjoy playing hoops. I said, we can't hire the guy.
Everyone I knew in college you like to play hoops,
was an idiot. Wow, no basketball guys, Sophie would not

(26:18):
have done well at PayPal. Nope, I know that hurts, Sophie.
I know that you really had a lot writing on
a PayPal career in two thousand and seven, So I'm
sorry it would have been you know what else has
a lot writing on a PayPal career and I don't
think it's going to work out for them. Is our sources,

(26:39):
our sponsors, sponsors, Jesus Christ, My head's not on straight today, Sophie.
You can tell that.

Speaker 1 (26:47):
I mean, it's not much different than any other day.

Speaker 2 (26:49):
But yep, well, hey, no, I'm normally breaking dads and
we're back. Okay, let's so, let's let's get back into
the Peter Teel story. So the early PayPal company culture

(27:09):
is obsessed with work, but it also carries a little
of Peter's growing antipathy towards college educations. One early employee
claimed that the big difference between Google and PayPal was quote,
Google wanted to hire PhDs. PayPal wanted to hire people
who got into PhD programs and dropped out.

Speaker 1 (27:27):
That is so interesting. Uh huh, that is so interesting.

Speaker 2 (27:32):
Yeah, yeah, yeah, it's this. And again, Peter's not a dropout,
right like he not like, like, for example, jobs, right.
He's not somebody who decides college isn't for me and
bounces to do his own thing. He gets a degree
and fails. So it's interesting that he's like, I am
only going to hire people who were, like I guess,
slightly more on the ball than me about realizing college

(27:53):
wasn't where they wanted to be. I guess PhD programs.
You have spent a lot of time in college at
that point. I don't know. You can you can interpret
that how you want. Levchin describes early PayPal employees as
geeky guys who quote didn't get laid very often. The
least surprising thing I've ever heard about payment. If you're

(28:14):
wondering what companies employees were fucking like crazy, PayPal's not
going to be your first bet. Obviously it's Yahoo. I
was gonna say Licos, but nobody's gonna remember Licos either.
So here's another quote from that Forbes article. In the
early days, when it came time to hire a high

(28:36):
ranking female engineer, she turned out to be bad at
ping pong. Levchin took that as a lack of competitive flare,
but grudgingly hired her anyway. She quit within six months.
Peter na never fails to rub that in. He grumbles, Oh, man, Peter,
like she can't play ping pong, There's no way she'll
fit in here. I think you guys were just committed

(28:57):
to making sure she wouldn't fit in there.

Speaker 3 (29:00):
Now.

Speaker 2 (29:02):
One thing I find interesting is that for all of
Peter's obsession with hierarchy, particularly as the rest of the
world is concerned, he doesn't appear to have actually been
that kind of manager. In other words, he is not
a like super dick, am I have to be in
charge only my way or the highway kind of guy.
He actually a lot of people say it was kind
of a very good manager in this period of time.

(29:24):
I'm going to read another quote from Forbes here. His
hallmark management emo at PayPal was the all hands, open
book session, customer logs, revenue flow, fraud, losses, burn rate.
He display it all for every employee to see. This
access to information, coupled with the lack of offices, created
a flat structure where any idea could win the day.
And that's not a bad way. That's a very effective

(29:45):
way of running things. That's probably part of why PayPal
works out, and it's interesting to me that like as
obsessed ideologically as he is with hierarchy, Peter tends to
run things as more of like an open book, flat
organizational structure where we're all just kind of sitting together
and bullshitting and like arguing and whoever can make the
best point, that's the idea that takes off. That's interesting

(30:06):
to me.

Speaker 3 (30:07):
As long as you're good at ping pong.

Speaker 2 (30:09):
As long as you as long as you fit into
his idea of the elites that he wants, right, And
maybe that is that I respect other people who I
see as being at my level, and so I can
work with them on a kind of approaching an even basis,
just I can't respect anyone else.

Speaker 3 (30:26):
Yeah, as long as long as you speak Orkish.

Speaker 2 (30:29):
Play, Yeah, Yes, as long as you can read the
runes on the Gates of Moria and hate basketball, you
can be in Peter's clubhouse. So you will note that
around the same time this is all happening, a guy
who's in the news occasionally. Some of you may have
heard of him. He's an obscure figure, but he comes
up now and again named Elon Musk started another company

(30:52):
named x dot com now not the not the social
networking site that we all refer to buy that name
at all times. Of course, No, this was actually a
different company and EARLIERX dot com. And the gist of
the story, I'm actually not going to talk a lot
about Musk and Teal at PayPal because in terms of

(31:13):
like popular culture knowledge of these guys, half of it
is the big fight that they had at PayPal. Right,
Musk and Teal had both started payment companies that were
doing very similar things, and the market was not big
enough to support them both as independent companies, so they
had to merge in order to be valid as a business. Right,

(31:34):
And the two don't get along and wind up like
finding But like that's that's the thing that gets reported
all the time. I just don't think it's that interesting.
It's also as behind the bastards goes the fact that
Peter Teal is a dick to Elon Musk, not really
evil to dislike Elon Musk. Yeah, I feel like we
can understand why Peter might not have gotten along with

(31:55):
Elon Musk. But the the basically what's happening here is
that both of these companies X and PayPal are funded
by a lot of VC money and they're kind of
lighting it on fire. At this point the company, neither
company is in the black, and the belief is that like,
the only way they'll get there is if they merge,
and this does work. This is an effective They get

(32:16):
kind of pressured into it, but this is an effective
like way to build a business. Now, Elon becomes the
CEO for a period of time, but he and Peter
do not get along, and Peter orchestrates a coup against
Musk while Elon is on vacation. I'd relate that in
more detail, but again, who can blame him?

Speaker 3 (32:37):
Now?

Speaker 2 (32:38):
The specific conflict seems to have arisen because Elon has
this obsession with moving the company off of Unix and
towards a Microsoft platform, whereas Teal and his ogs are
all very much like in the Unix tank, right and
so like that's kind of the root of a lot
of the conflicts between them. But the larger issue is
that there's just a personality clash. They don't like each other.

(33:00):
And one of the things that's really funny here is
that is as much as both of these guys suck,
and they're both current like right wing influential, right wing
like monsters, they both had each other's number twenty years ago,
like their criticisms of each other are perfectly valid. Chafkin
quotes a colleague who talked to each man about the

(33:21):
other during this period, and this colleague said, Musk thinks
Peter is a sociopath, and Peter thinks Musk is a
fraud and a braggart. Hey, guys, you're both right. You
did it.

Speaker 3 (33:35):
Incredible.

Speaker 2 (33:36):
Yeah, that's not bad, all right.

Speaker 3 (33:41):
I can't wait for the next Trump administration when they're yeah,
that's gonna be to dismantle the state.

Speaker 2 (33:49):
Yeah, yeah, yeah, that's kind of an either no matter
who wins, we lose or or maybe the mister burns
so many diseases that it kind of keeps the structure
propped up up.

Speaker 3 (34:01):
I guess yeah.

Speaker 2 (34:05):
That's that's your call. Yeah, okay, okay, I again, I
think it's Alien four, but nobody's going to understand my
references to Alien four. So what I do think that
you can probably understand all politics via one of the
Alien movies, as long as it's not the David Fincher one.
You know, let's just keep Alien three shovel that aside,

(34:27):
you know, Alien Resurrection, Alien Aliens, all good politics. So yeah,
I think it's funny that these guys very clearly get
who each other is in such a strong way, and
they kind of they seem to have had a little
bit of a rapprochma, in part because Peter is later
going to save SpaceX with an investment kind of. But uh,

(34:50):
once Peter ousts Musk, the two are at arms. Lincoln,
they hate each other for years, right, They are very
clearly enemies for a while. After this, Peter takes over
Muscus CEO, and in this role he has a couple
of strengths. He's noted by his employees as being a
very supportive manager. He's the kind of guy who will
give you a ton of freedom in the world to
explore and try stuff out. Now, the downside of this

(35:13):
is Peter actually doesn't like confrontation. He's terrible at firing
people if he brings someone in, in part because I
think he mostly hires people he likes. If they're bad
or they fuck up, he'll shuffle them around. But he
doesn't tend to just let people go. He's really bad
at that actually, which is interesting to me. Now, one
of the big successes PayPal has in this period. As

(35:35):
a result of Peter's management style is that they develop
innovative technology aimed at fighting online fraud. From a fairly
early point in the business, around the year two thousand,
PayPal had started dealing with Russian scammers creating shell accounts
with stolen credit card numbers using bots. It actually goes
back quite a while. This is again happening before nine
to eleven. Teal didn't want to crack down on this

(35:57):
in a way that would make the service harder to use,
because it being easy to use was part of the appeal, right,
So instead, what they needed to do is actually figure
out where these networks were and shut down the network surgically.
So he has Levchin design a program that forced users
to copy letters displayed over a background that made them
impossible for machines to read. This becomes the capture system, right.

(36:20):
We all know that that is comes out of PayPal.
Levchin is the guy who codes it, but Teal is
a big part of like why we get capture now,
that's obviously very influential. We've all had to do god
knows an infinite number of these fucking things. But that
innovation alone only puts a dentt in the online like
fraud problem. So near the end of two thousand, a

(36:40):
PayPal employee named John Kolthanak, who's a former military intelligence man,
started building what we today call the crazy board. Right
where he's he's trying to like do the little like
string like time bits of string to pictures of different
like fraud networks, try to map out these accounts of
fraudsters who are attacking PayPal. And he does this. It's
all kind of in a very like isolator, in a

(37:02):
very like labor intensive way, like building this like map
is a real pain in the ass, but he does
eventually isolate the main culprit of the botnet, you know,
defrauding them, a guy nicknamed Egor who had taken twenty
million dollars or so out of PayPal. Now, when this
worked out, this is a very effective method of getting
this guy, they decide, like, we need a way to

(37:24):
automate this process. Right, it's too slow to build a
crazy board the way call Thinek had, So let's have
Levchin code, a system by which you can map out
links between different groups of bad actors, so you can
build an actual physical understanding of these networks in real time. Right,

(37:45):
this app to build this kind of a crazy board
system is what becomes Palantier, right, yeah, yeah. Levchin calls
the program Egor because of this guy that Kothanek had caught,
and he builds this program and it's for PayPal to
stop fraud. This is what becomes Palenter. This is the
core of Palenteer, right, it comes from Igor.

Speaker 3 (38:05):
Yeah.

Speaker 2 (38:07):
Yeah, very interesting stuff. Yes, and we will be talking
a lot about Palatineer in Bart three. Teal's management style.
So again, if you're looking at this, this is both
like you should be hearing that music, like we can
see the evil coming up here, but also this is
evidence that like Peter's management style isn't bad. These are

(38:28):
effective outcomes that make a lot of money.

Speaker 3 (38:30):
Right.

Speaker 2 (38:30):
He is capable of motivating and managing people and giving
them the freedom they need to innovate. You know that
you have to acknowledge that about the guy totally. Yeah.
But that said, he also has a lot of blind spots,
and these are well described in this quote from that
Forbes article. In two thousand and seven, PayPal's losses were multiplying.
It battled Russian fraudsters who are filching millions by cribbing

(38:53):
credit card numbers. Customer service complaints flooded the phone lines
and inboxes, where often dealt with by simply not answering
the phone doing a mass deletion. Louisiana temporarily banned PayPal
from doing business in the state. MasterCard threatened to pull
the plug because of the high number of chargebacks. Peter
Teel didn't know what a chargeback was, said Jawed Karim,

(39:13):
an early engineer who went on to found YouTube with
fellow alumni Chad Hurley and Steve Chin and then sell
it to Google. That's one of the fundamental things of
any credit card payment system. Chargebacks almost killed the company.
So there's also, in this very libertarian way, he doesn't
understand very basic aspects of reality that are central to
the thing he's trying to do, and it nearly kills them. Right, Like,

(39:34):
you don't know what a chargeback is and you are
running a payment processing company, Like that's a big, big
blind spot, right, I know what a chargeback is, and
I'm just a guy who was bad at having a
credit card.

Speaker 3 (39:47):
You know. Right. But he's not very far removed from
just being like.

Speaker 2 (39:52):
A punt right, right, And when you understand that is
his background, right, that he doesn't really have a life
outside of not making it as a lawyer and then
being a wagon pundit. I get while you've got some
blind spots, Peter.

Speaker 5 (40:04):
Yeah, so that's really interesting about the Palin board, Like, yeah,
that that you know, I mean, I grew a giant company,
you know, almost by accident out of.

Speaker 3 (40:15):
The zone one.

Speaker 2 (40:16):
Yeah. Yeah, And and that is like one of the
more interesting stories with with Teal, right, because it doesn't
come out of this.

Speaker 3 (40:24):
The fact that.

Speaker 2 (40:25):
He's after nine to eleven able to see like, oh,
you know, this thing we've used to stop networks of scammers,
you can probably sell to the government to try to
stop terrorists right after this big attack. You know, that's
a that's that's some genuine insight. So PayPal, you know,
it struggles with profitability, but they eventually break even after

(40:46):
about one hundred and eighty million had been poured into
the idea. Now under Elon and Peter Teal, PayPal is
never profitable, right, they hit break even, and as soon
as they hit break even, they carry out an ip
Right immediately after their IPO, the company is sold to
eBay for one and a half billion dollars, and Peter

(41:07):
leaves instantly right the financially successful portion of PayPal's history,
he is not around for him. In fact, the first
thing he does after living is he basically he sets
up he's going to set up like a venture capital fund,
and he's going to short PayPal. Right, he sells this
thing off and he's like, I'm immediately going to bet
against it. Yeah, yeah, yeah. He has absolutely not at all,

(41:30):
no loyalty or anything like that. Right, Like, he gets
his money and he gets out, I am done. I
have no more interest in this idea, right And I
think in part because it's become clear at this point
by two thousand and two, PayPal is not going to
destroy capital like destroy or so Kim. PayPal is not
going to destroy like liberal democratic governments. It's not going
to create its own currency system. It's just going to
be the way people use spend money on the internet.

(41:51):
And that's not interesting to him right now. Part of
why I think he gets into this like shorting, betting
against this thing he'd helped to build, is that two
thousand and two is also right after nine to eleven,
and Peter is one of many Americans who kind of
loses his mind over nine to eleven, Right, this is
a deranging moment for him, and it also like it

(42:14):
fucks up the fact that he has this need to
be seen as a contrarian, as separate, as above the herd, right.
And it's interesting to me that for all of that,
he is very much in line with like regular people
like my parents. When it comes to just like losing
his mind over this terrorist attack, it terrifies him. He's
going to participate in a program by the Bush White
House to bring Silicon Valley movers and shakers in closer

(42:37):
contact with the Republican Party. This is the first he
had a lot of his friends from PayPal, people that
like had kind of seen him as like he's a libertarian,
He's a Silicon Valley libertarian, but like libertarians were very
anti Bush in this period. And the fact that Peter
is willing to get in out of the Republican Party,
a lot of people is like, oh, I don't really

(42:58):
know this guy like I thought I did. This does
not make sense where the person I thought Peter was.
And you know, some of what's going on here is
that the tech bubble has burst in this post nine
to eleven period right, the period immediately after the attacks
from the US is invading Afghanistan and spinning up towards
invading Iraq is a bad time for big tech. The

(43:20):
dot com bubble had burst, and the economy in general
had shit. The bed is partly as a result of
the attacks. Peter, who has always had a good gut
instinct for the momentum of the moment and culture, opted
to spend a lot of the next two years kind
of fucking around, right. He like he gets from two
thousand and two to two thousand and four that like, there,
this is not really a great time to be investing

(43:41):
in most things. And he's also he's just sold his
first company. He's mega rich now, so some of what
he's doing is just, you know, he's kind of idly
shorting his old business the US economy. But he's also
just kind of like doing the very understandable thing, which
is partying for a while, you know. So this is
also where Peter, you could kind of see this as
he's getting some space and he starts to find himself

(44:05):
during this period. Chaff Gin rights that as CEO of PayPal,
Peter had dressed down in a T shirt and old jeans,
but as soon as he sold off his interest in
the company. Quote now Teal had a wardrobe full of
suits and a silver Ferrari spider three p. Sixty read,
he told The New York Times magazine would have been
over the top. He purchased a ten thousand square foot

(44:25):
mansion in San Francisco and filled it with art, but
also conference rooms, a day to night lounge, and a
kitchen meant for buffets. It was a place to work
and host work, but chaf gin rights. There were no keepsakes,
no magazines, and no family photos. Teal's homes, as one
visitor remarked, referring to the Presidio mansion and a grand
apartment that Peter acquired in New York City, looked like

(44:46):
stage sets and it's hard to tell someone actually lives
in them. I feel like that's just being mega rich.
You've got enough be able to keep everything clean all
the time, and you want a lot of nice star yeah.
Teal invested money in an eye club called Frisson after
one of his friend friends bragged about a different nightclub
in New York City that had co ed bathrooms and

(45:08):
so uh. Frissan is largely based around its co ed bathrooms,
which are designed to provide couples with an easy way
to fuck in a public bathroom because some people want that.
That's at least, you know the allegation from Chapkins book
that like he builds this night because a friend is like, yeah,
there's this fucking club in New York and you have

(45:29):
sex with your girlfriend in the bathrooms.

Speaker 3 (45:31):
And Peter's like, I.

Speaker 2 (45:32):
Need to own one of those in the in the
West Coast.

Speaker 3 (45:36):
Uh, Silicon Valley. It's yeah, yeah, bathroom fuck.

Speaker 2 (45:40):
Yeah, you've invented fucking in a club. Bathroom. Congratulations. Peter
like comes in one day dressed as Steve Jobs, Like,
I've had an incredibly great idea doing cocaine in a bathroom.
This is going to revolutionized partying as.

Speaker 3 (45:55):
A rich guy for san is like the name of
like a USA Networks, Uh like rom coms version of
a club. Yeah, it's like that's when the guys from
suits went to.

Speaker 2 (46:11):
Yeah, yeah, definitely. Now it also hosted fine dining, and
I gotta say it works for a while, although in
a way that's creepy. In retrospect, Chief Gen makes hay
out of the celebrities that became regulars. Quote Lars Ulrich,
Robert Redford, Kevin Spacey, what a party?

Speaker 3 (46:36):
Robert Redford? Cool?

Speaker 2 (46:37):
Fine, yeah, Robert Redford, He's really the sandwich.

Speaker 3 (46:41):
Yeh, super cool. Yeah, Lars Ulrich and.

Speaker 2 (46:44):
Kevin Lars Alway in the period oh God, because it's
also like that's like page yeah yeah, Lars Alric space
God because yeah, that's like peak angry at fucking nabster.
Lars Ulrich and I don't and I'm not gonna make

(47:05):
allegations about Kevin Spacey, given to how litigious he is,
but like, read something about Kevin Spacey. Just just read
something about Kevin Spacey and then make a guess what's
going on in the bathrooms of Frassan casting for great movies? Obviously,
so he tries his hand at publishing in this period

(47:26):
two and you are not going to guess what magazine
he launches.

Speaker 3 (47:30):
What what sport?

Speaker 2 (47:32):
Would Peter Thiel launch a magazine based around in two
thousand and two or four something like that school squash?

Speaker 3 (47:42):
I don't know, squash.

Speaker 2 (47:44):
Okay, you got a guess?

Speaker 3 (47:45):
Noah, I mean I thought you were giving us like
the foreshadowing with Ping Pong.

Speaker 2 (47:51):
No, that would have been very I would have respected
the hell out of that if he had tried to
get a Ping Bong magazine off the ground about all
the time, Pickle, no, not pick I don't know that exists.

Speaker 3 (48:05):
Just like Ping Pong won a slightly large record anywhere.

Speaker 2 (48:08):
Yeah, Frisbee, it's ping pong for dads. Frisbee, Frisbee, no ball.
I'm satisfied that none of you guessed. The magazine he
launches is named American Thunder, and it's it's about Nascar.

Speaker 1 (48:26):
That sounds like, sounds like a dirty magazine.

Speaker 3 (48:31):
It may have been.

Speaker 2 (48:32):
It was a little bit pornographic. This is a psyop.

Speaker 3 (48:38):
Oh, yeah, he is.

Speaker 2 (48:40):
He does this. The goal of this is he starts
a NASCAR magazine and he hires only his right wing
think tank friends to write about in it, and their
goal is to use NASCAR's cultural cachet with like regular
conservatives to push more of their extremist like libertarian ideas
to Republicans. Right, that's the goal of American Thunder. And

(49:02):
it's wild to me he puts ten million dollars into
this magazine despite the fact that he is not interested
in Nascar. He brings his old Stanford Review buddies in
and the first issue, rather than like talking about NASCAR
in a meaningful way, has like an essay about how
the magazine is not going to embody any sense of
political correctness, which at this maybe today that would work.

(49:26):
At this point in time, the kind of people who
buy a NASCAR magazine really just want to read about
Jeff Gordon and Dale Earnhart. You know, like just sit
in your rants, know.

Speaker 3 (49:38):
This, What if hold on, hold on? Wait, okay, what
if he had done that but with pampon that would.

Speaker 2 (49:45):
Be incredibly funny, just like a red pill.

Speaker 3 (49:50):
Everybody throw ping pong.

Speaker 2 (49:52):
His Ping Pong magazine is entirely about the gold standard.
There's just a forty five pay ranton here about euthanizing
the poor. I was trying to buy a new racket.
I still don't know what kind of table again. Yeah,
so yes, this is It seems to have been a

(50:13):
badly disguised tempt to attempt to propagandize to normal working jos.
And this is embodied well by the magazine's Real Guys column.
And here's how Chifkin describes that it was written not
by an auto journalist but by the online editor for
The Weekly Standard, who devoted his first column to the
idea that ESPN had been emasculated by namby pamby political correctness,

(50:36):
the grub page where a normal magazine would have struck
the barbecue recipes included in its inaugural column.

Speaker 3 (50:42):
Incredible.

Speaker 2 (50:43):
Yeah, a possibly tongue in cheek anthropological discussion of why
household cooking should be considered women's work. Everyday cooking is ature.
A few men ever get around to, or even care
to get around to. We are grateful that this is
how things have worked out. So grateful we'll even help
with the dishes from time to time. Fuck, I just

(51:03):
tell people how to fucking make a barbecue sauce.

Speaker 5 (51:06):
Man.

Speaker 2 (51:06):
Come on, somebody needs this in their NASCAR magazine.

Speaker 1 (51:11):
Up Jesus Christ.

Speaker 2 (51:14):
So it says a lot about the economics of magazines,
because like, if somebody hands me ten million dollars to
start a media company, I think I can do a
lot with ten million dollars. Peter's magazine is bankrupt by
the end of two thousand and five. It lasts about
a year, So that's a pretty I think even with
magazine money, that's a pretty You know more about this
than me, no, but that seems like a pretty fast

(51:34):
burn rate.

Speaker 3 (51:37):
I mean, good on him, you know, good on him.
I'm sure there's some lavish photo shoots, definitely, you know,
featuring Camille Pallia.

Speaker 2 (51:46):
Uh, you knows favorite intellectually, yeah.

Speaker 3 (51:54):
After on top of a stock car. Yeah, I'm sure
there's some real like you know, a lot of like
nineties technology devoted to like you know, Mussolini U photoshopped
into you know, Dale Earnhardt's machine.

Speaker 2 (52:12):
I wonder if we got because Dale Earnhardt famously like
helped lead a crusade against like the use of Confederate
flags at NASCAR events. I wonder if there's an angry
column about that in this I don't remember the exact
year that that happened, though, Uh.

Speaker 3 (52:28):
It's like bring back to General Lee.

Speaker 2 (52:30):
Yeah, yeah, I wonder if that was a cause for
these people.

Speaker 3 (52:33):
Do you know that dukes of hazard guys were in
there somehow? Yeah?

Speaker 2 (52:37):
Yeah, Jesus Chris Peterteel's NASCAR magazine. The issues of that
have to be a collector side at this point. Ready, Yeah,
American Thunder is bankrupt by the end of the year.
Forssan lasts a little bit longer and makes it till
two thousand and eight. Now, the fact that he's pouring
money into these and all of them are lost lostly,

(53:00):
you could say it doesn't hurt him. He's got plenty
of money, and neither of him have been about making
a profit. Both were away scheme, There were schemes to
gain influence, right. The nightclub was a way of like
setting him up in like the popular, like cool hip,
celebrity set, and this magazine was an attempt to gain
influence with the working class.

Speaker 3 (53:21):
Right.

Speaker 2 (53:21):
So the fact that neither of these make money doesn't
disturb Peter. But he also knows that he's not going
to be able to coast forever off of his PayPal money.
And you know what, we here aren't going to be
able to coast forever off of the money we already
have from ads. So why don't you listen to a
couple more You're back?

Speaker 1 (53:42):
That was beautiful, Thank you, thank you.

Speaker 2 (53:44):
I thought that was one of my better one of
my better plugs. So by this point, Peter Thiel, you know,
kind of the period he's trying all this stuff out.
He's also started a new company, an investment firm called
Clarion Capital, which had been founded in two thousand and two. Now, Peter,
not long after Clarium gets found and is going to

(54:04):
get in on the ground floor of investing in Facebook.
He gets a ten percent steak in the company, but
that deal is also structured in some ways as a loan.
This is one of those things that's covered a lot
in the social network right. Basically, he puts the steak
in the company to which allows Facebook to survive in
its early days, but he does so in such a
way that in order to make the company viable, Zuckerberg

(54:29):
has to ice out one of his other founders who
has like a twenty seven percent steak in the company,
which he does. This is Zuck's big first betrayal, and
you can see Peter is kind of like the puppet
master in it. Now again, these are all the kids
who started Facebook. So the fact that they are backstabbing
each other at Peter Teel's incitement, I'm not really all
that interested in. It's like a mark of human evil.

(54:50):
That just seems like the kind of thing that was
always going to happen at Facebook. But you could see
that like Peter's the guy who corrupts Mark Zuckerberg. I
don't know, I think that's really accurate. I think Mark
was always willing to be corrupted, but that's one version
of the story.

Speaker 3 (55:06):
Now.

Speaker 2 (55:07):
The play by play here has been covered and off
in movies in our own episodes on Marky Mark. What
I did learn reading Chaefkin's recitation of events is that
Peter is kind of he kind of fucks up his
Facebook investment. He gets in early on the ground floor,
and he does make money, but he loses his He
gets in on this first round and makes a profit,

(55:28):
but when it comes time for the second another round
of investments, he thinks the business is overvalued and like
like one hundred and seventy million, like, he thinks Facebook
is overvalued, and so he fails to roll his investment forward.
And as a result, despite being famous as this early
Facebook investment investor, he doesn't make much money off of Facebook.

Speaker 3 (55:50):
What.

Speaker 2 (55:50):
Yeah, he really does not make shit compared to what
you would expect, right for normal people. He makes a
lot of money off of Facebook, right, but for what
you would expect in base he does not make a
lot because he kind of bows out of subsequent rounds
of investment because he doesn't believe in the company.

Speaker 3 (56:07):
Right. He's really his whole, his whole thing. Okay, So
like investment number one PayPal, which he then.

Speaker 2 (56:14):
Sells right, kind of shorts yeah, and.

Speaker 3 (56:19):
Then Facebook, which he does put money in, picks the
founders against one another maybe if they're easy to do
it anyway, and then doesn't really believe in it, so
doesn't really maximize his.

Speaker 2 (56:29):
Yeah, and this is it's not It would never be
fair to say Peter has bad instincts because he is
right about a lot. He's right if there's something in PayPal,
but he's wrong about how much there is in PayPal.
And this is actually going to be a real pattern
in his investments where he'll understand something important but not
to the extent that allows him to actually make much

(56:51):
money off of it, right, Or he'll he'll get a
guess right, but he won't commit to it to the
extent that allows him to really profit from it. And
I think that's a really interesting aspect of him, right,
that he he has these good instincts in some ways,
but that he also consistently fails to follow up on
them enough. I find that very interesting and actually honestly

(57:13):
kind of relatable, like as a guy who's made some
of his bones predicting things, and also I am aware
of the things that I have been wrong about. I
really find that kind of like, like, I get it, Peter,
It's it's hard, actually, you know. So, as he's exploring
life as a venture capitalists and kind of the early aughts,

(57:35):
Peter continues his involvement with Stanford organizing a symposium on
politics and the apocalypse and this is these are this
is prior to two thousand and eight. So the housing
crisis is coming up. This is another one of those
good predictions. Peter sees the housing crisis coming up. He
sees that economic like crumbling, but he as opposed to

(57:58):
just being like, oh, there's a house collapse. It's going
to be a real problem and there will be some
financial opportunities as a result of that problem, which like
the big short guys also right, Peter sees the collapse coming,
but he assumes the whole system is going to crumble, right,
Like he thinks he literally thinks the housing collapse is
going to destroy the entire US government basically, right, what yeah, yeah,

(58:22):
So again he's like, you're right, but not in the
way that allows you to like, but you also like
are wrong in a way that means that you can't
really profit off of the initial rightness there, right, you
see the problem and then you massively over extend it
because of your ideology, and so you fuck up at
profiting from this moment in American history.

Speaker 3 (58:43):
So he like y two ks yes, yes, yeah, in
mind what ye do the mind say? Civilization was supposed
to be destroyed like twelve.

Speaker 2 (58:54):
Twenty twelve, so that was that was going around at
this point in time.

Speaker 3 (58:57):
Yeah, he was just a little for the Mayan apocalypt.

Speaker 2 (59:01):
Yah, maybe Kevin Space he told him about the Mayan
apocalypse during a dinner at SAD.

Speaker 3 (59:11):
So he thought that. He's like, Okay, there's all these
like derivatives or problematic housing rate you were giving mortgage
launches too many people. Therefore collapse of all Western yes, civilization, Yes.

Speaker 2 (59:24):
And I think it's because he sees that banks and
stuff are going to go under, but he doesn't see
that the government is going to respond in any way
to bail them out and prop up the system, right,
which is such an interesting shortcoming to not see that,
like the people running the system have a sense of
self preservation, right, like whatever you say about it, like

(59:44):
Obama and or you know, even if it had been
bushes like. None of them had a desire in the
entire financial system collapsing. You know, no, definitely not yeah.
Writing in twenty twenty one for The New Yorker about
this Politics and the Apocalypse Symposium, Anna Winer summarizes Teal's contribution,
later published in an essay titled The Straussian Moment was

(01:00:06):
built on the premise that September eleventh had upended the
entire political and military framework of the nineteenth and twentieth centuries,
demanding a re examination of the foundations of modern politics.
The essay drew from a grab bag of thinkers. It
mediated on Thomas Hobbs and John Locke, and then combined
ideas from the conservative political theorists Leo Strauss and Karl Schmidt,

(01:00:28):
who wrote about the inadequacies of liberal democracy, with the
work of Girard to offer a diagnosis of modernity. A
religious war has been brought to a land that no
longer cares for religious wars, Teele wrote, Today mere self
preservation forces all of us to look at the world anew,
to think strange new thoughts, and thereby to awaken from
that very long and profitable period of intellectual slumber and

(01:00:51):
amnesia that is so misleadingly called the Enlightenment. There's so
much there. There's so much there.

Speaker 3 (01:01:00):
First of all, this guy is fucking messy. Yeah, you know,
it's this guy is out of fucking control. Yeah. Like
the whole point of terrorism is to overreact, and this
guy wants to overrea.

Speaker 2 (01:01:14):
We have to overreact.

Speaker 4 (01:01:15):
Yeah.

Speaker 3 (01:01:16):
Yeah, it's so hard that he wants to overturn the Enlightenment. Yeah,
it's like, well, what the fuck?

Speaker 2 (01:01:24):
I think it's because he's writing about like, America doesn't
care for religious wars, but we've been forced ones. Like
but Peter, you're a Christian culture warrior, right, Like you
have these very weird ideas about Christianity and morality that
you are kind of trying to force on people through
your politics. That's a religious war, right like that To
say that America doesn't care for religious wars and then

(01:01:47):
to look out at twenty twenties US politics is a
wild thing, right, and it's it's, yeah, just a fascinating
statement for him to make, right.

Speaker 3 (01:01:57):
This idea that like yeah, yeah, I mean, look, all
the problems that we had after nine to eleven, or
a lot of them were because fragile men like him overreacted,
freaked the fuck out, treated it like a religious war
rather than as you know, some kind of active terrorism,

(01:02:18):
treated as some kind of like apocalyptic conflict. Yeah, we
have to engage in this clash. Yeah, oh my god.

Speaker 2 (01:02:26):
Yeah, it's it's it is. That's part of what's interesting
to me is that again, for all his desire to
be seen as this like contrarian standing apart from the herd,
he's just a neo cod like in this period at least, like,
how else do you look at this? Right, Because like
a big part of him after this point and in
this post PayPal period is he's still scared and frightened

(01:02:48):
of nine to eleven, and he is obsessed with the
idea that nine to eleven has proved we need to
give up freedom for security. This is where he really
jettisons a lot of those libertarian ideas.

Speaker 3 (01:02:58):
Right.

Speaker 2 (01:02:58):
He describes the acecluse attempt to protect civil liberties in
the post nine to eleven period as an unviable anachronism.
He acknowledges that the twentieth century included a great deal
of programs that claimed to exist economically to develop the
Third World, but really just extracted or put more hash
in the cash in the hands of dictators. But he

(01:03:19):
also argues that this doesn't explain why people from the
global South would want to attack the rest the West.
His reasoning way of looking at Osama bin Laden is
that this is a rich kid, right, and so all
of these arguments about how we can stop terrorism and
we can stop these kind of conflicts between the West
and other parts of the world by increasing economic development

(01:03:41):
in those areas are bullshit because Osama bin Laden was rich,
and like what much like the fact that Osama, like Osama,
did not start the conflict that he was a part
of here, right, and like the fact that he is
a rich kid, it makes sense in the way that

(01:04:02):
like you, Peter, were a rich kid who decided that
you want to destroy democracy, right, Like that is the
class of people who tend to become revolutionaries often come
from a degree of financial privilege, because those are the
people who have the time and the space to think
about stuff like overthrowing the system in the moment, and
you have the resources to go about doing it. This

(01:04:24):
is not an uncommon story in history. The fact that
bin Laden becomes this kind of guy is no weirder
than the fact that Peter becomes this kind of guy right,
game recognizes game, and like the fact that osamban Laden
was not an a grief poor person doesn't mean that
the economic betrayal of the global South isn't an important

(01:04:45):
factor in geopolitical instability. It's a lot of what Peter
says is that, like, you can't stop instability and conflict
by helping to improve living standards in poor countries. Because
Osama bin Laden did nine to eleven.

Speaker 3 (01:05:03):
It's like two sentences have nothing to do with you.

Speaker 2 (01:05:06):
Yeah, okay, peterbelievable. Yeah, it's it's shot and it's such
bushy and logic. Again for this guy who really wants
to stand apart from the herd. This is just the
kind of shit my parents were saying in two thousand
and five.

Speaker 3 (01:05:21):
It's also like completely wild. Then this guy goes on
to basically be like one of Glenn Greenwald's big Yeah. Yeah,
it's like some weird like twisted orseship. Also, it's like
this guy, so this guy is basically just like more

(01:05:42):
Christian Dick Cheney, more techy Cheney.

Speaker 2 (01:05:47):
Yeah, more techie, and probably more Christian. Yeah, you're probably
that's probably accurate.

Speaker 3 (01:05:52):
More for song.

Speaker 2 (01:05:53):
Yeah, with more for song, Yeah, a little more Kevin
Spacey too, probably Yeah, no, no, no, that's not an
allegation we're making.

Speaker 3 (01:05:59):
Yeah.

Speaker 2 (01:06:00):
So Deeals analysis I think is inch deep here because
he's in this period, and I'll say somewhat understandably because
everyone was entirely focused still on nine to eleven. Now,
the problem for Peter is that, and this is kind
of what Bin Laden like. Peter falls into ben Laden's
trap perfectly here. He sees nine to eleven as this

(01:06:20):
singular incident, and it clearly terrifies him. And he writes
that this proved to him and proved to the world
that quote, a tiny number of people could inflict unprecedented
levels of damage and death. And this is why everything
about liberal democracy, about civil rights has to change, Right,
is that now we know it's possible for a small
number of people to kill a large number of people, right,

(01:06:41):
and that that completely changes the game.

Speaker 3 (01:06:44):
Now.

Speaker 2 (01:06:44):
I don't think Peter's being entirely honest here, because that's
not what scared him about nine to eleven. The twenty
first century has been a century of aaron drone strikes
of small numbers of people murdering large numbers of people
in countries all over the world. Peter doesn't care these
dead people because he's never going to get stuck in
a war zone.

Speaker 3 (01:07:03):
Right.

Speaker 2 (01:07:04):
That's part of why he got a New Zealand citizenship
for himself, Right, it's because he's not going to be
anywhere close to a war. Nine to eleven shatters pedter Tiel.
Not because it proves that small numbers of people can
kill large numbers of people, but because it proved that
a small number of people could kill a lot of
rich people.

Speaker 3 (01:07:21):
Right.

Speaker 2 (01:07:21):
And I'm not doing all justifying nine to eleven thing,
but like nine to eleven is a strike on the
financial center of the country. A lot of CEO's businessmen,
people who are executives at big companies die in that attack,
an attack on the World Trade Center. Peter can see
himself as being a victim of that. He very well
might have been in the World Trade Center, right, Like

(01:07:42):
that is the kind of thing that could have affected him.
And that's why this scares him. Right, It's not that
a lot of people are a small numbers who can
kill a lot of people. It's that I am not
safe as a wealthy businessman, right, Like someone could kill me.
That's why this fucks him up.

Speaker 3 (01:07:59):
Yeah, it's interesting that, like, you're the degree to which
the people that really freaked out over nine to eleven, like,
none of them actually lived in the places where nine
to eleven happened. No, Like I say, this is a
New Yorker, Like New Yorkers did not freak out over
nine to eleven. Like, but people you know from vugging

(01:08:21):
uranium mind South Africa who relocate to Palo Alto there
to lose a mind.

Speaker 2 (01:08:29):
Yeah, because oh my god, I might have been in
a place that was My entire life is about separating
myself from the masses and gaining a sense of safety
as and like value as a result of that. And like,
I could have just died like everyone else. I also
think that's why he's so scared of death. It's not
just the cessation of his own being, but death inevitably.

(01:08:51):
The fact that you will die, this is true of
all of us, links you to everyone who ever has
and ever will live, right, it is one thing we
all have in common. Everyone will die. And Peter hates
the idea that he has anything to do with everyone else,
that he has every something in common with the rabble
that there is a thing that inevitably, inextricably binds him

(01:09:14):
to a poor man in fucking Deli. Right, they're both
gonna die, and in fact, that guy living on the
street of Delhi might live longer than Peter, just because
you know, shit happens. Right, Peter could be the victim
of an attack someday and then maybe he'll be outlived
by a poor person.

Speaker 3 (01:09:31):
Right.

Speaker 2 (01:09:32):
Peter cannot handle this reality. It drives him mad.

Speaker 3 (01:09:36):
My brain is fried right now. Yeah, I'm just I'm
trying to make the logical inferences to this dude makes
and I'm having trouble doing it. Like I don't understand,
Like there are people, tons of people I disagree with,
and I see how they get from A to B.
This is like from A to the symbol for you know,

(01:09:58):
for boron or something. I don't understand where, like where
it is is even coming from.

Speaker 2 (01:10:03):
It's yeah, yeah, because it is confusing. I think, what
if I had to describe it, it's oppositional defiant disorder
with main like merging with main character syndrome. Right, Like
that's that's that's kind of how I would look at
Peter here now. Later in that same essay. He thinks back.

(01:10:24):
He goes back to the philosophical writings of Gerard on mimetics,
arguing that the need to keep up with your neighbors
leads to an ever escalating rivalry. He declares that the
disturbing truth of mimesis has been suppressed, and in the
same breath notes that envy is a mortal sin and Catholicism. Now,
the conspiracism is weird here, but it's no weirder than

(01:10:44):
what theater Teal goes on to claim about ape anthropology.
This is again an essay about nine to eleven. At
the core of the mimetic account, there exists a mystery
what exactly happened in the distant past when all the
apes were reaching for the same object, when the rivalry
between memetic devils threatened to escalate into unlimited violence. I

(01:11:05):
don't know at that moment occurred. Peter, what are you
fucking talking about?

Speaker 3 (01:11:08):
Man?

Speaker 2 (01:11:11):
Stop this shit? Stop reading Gerard? What the fuck are
you talking about?

Speaker 3 (01:11:15):
Bat? Really?

Speaker 1 (01:11:16):
Stop reading Gerard.

Speaker 2 (01:11:17):
What he's saying here.

Speaker 3 (01:11:19):
Is that.

Speaker 2 (01:11:21):
There's this because like we get our we want things
because we see other people having things or wanting things,
and that like forms throughout this memetic process, like our
system of desire, and that like you know, this truth
has been suppressed by the secret masters of the world
to someun extent, And there's this mystery of like, well,

(01:11:41):
how did you know, how did we avoid this like
kind of escalating sense of like jealousy and rivalry for
things escalate into this unlimited violence that would have destroyed
the species. And the answer is, we figured out how
to scapegoat individuals in order to like stop from mass killing. Right.
And Peter has to think in this way because he

(01:12:04):
has this very narrow view of anthropology that's informed by
Girard's writing, and this concept Gerard has of like war
of all against all, right, and that the only way
to avoid this is to gradually drive the combatants to
gang up against a scapegoat. Right now, among other things,
if we're just talking about ape, and if we're talking
about anthropology, this is all ignoring the degree to which

(01:12:26):
primates work together and collaborate, which is also like as
much a war and conflict is certainly a part of
primate evolution. You can find like apes, different kind species
of simians go to war with each other in like
a very recognizable way. You can see that with like
chimpanzees and the like. But they also collaborate and work together, right, Like,
just picking the one side of things like how they

(01:12:48):
fight for resources and ignoring how they team up in
order to get resources and make a better life for
themselves is kind of cutting out half of existence.

Speaker 3 (01:12:58):
This Yeah, it's like what do you only watch like
the first ten minutes of two thousand and one on.

Speaker 2 (01:13:05):
Yes, yes, yes, that's his That's the whole basis of
his like understanding of like mimetic reality. It's like, yeah,
monkeys fight.

Speaker 3 (01:13:15):
It's so weird.

Speaker 2 (01:13:17):
It's really fucking no.

Speaker 1 (01:13:18):
And I have had the same face of just like
ugh the last ten minutes.

Speaker 2 (01:13:23):
Again, studying philosophy is sometimes a problem.

Speaker 7 (01:13:27):
This guy needs to take one walk in the woods. Yeah,
Like this guy needs to like, I don't know, like
read one other book.

Speaker 2 (01:13:39):
It's a fucking having that experience of life. He'd been
in like a car wreck as a younger man, and
it had like a bystander come and pull him out
of the ray could have changed his whole impression of humanity.
But instead he's like, we're all apes and we need escapegold.
Everyone's going to break down and be fighting and killing
each other unless we like and you kind of get
the idea that like, oh, so this war against Islam

(01:14:00):
you see as like a scapegoat, and maybe now these
kind of attacks you're you're kind of working on against,
like the trans community, against all these different enemies of conservatism.
You see this as like we I have to give
people a scapegoat in order to stop them from taking
the things I have, because they're they're going to want
the things I have because like they've been influenced mometically

(01:14:22):
to desire the same things that you know, I have received.
I think that's like a really kind of a core
aspect of his understanding of how the world works, such
a person. At the end, at the ending of this article,
this very weird article, Peter comes around to the subject
of monarchy, arguing myth transfigure the murdered scapegoats into God.

(01:14:45):
So human beings created scapegoats so we could avoid murdering
each other, and then we turned those scapegoats into our
early pagan deities, which is like, again, weird. I don't
I don't get that at all. I guess there's there's
like some Greek gods who that kind of makes sense
for right, like Prometheus maybe, but that I don't know

(01:15:06):
how how is zeus a murdered scape where it's the
murdered scapegoat that's the basis of that? Or like I
don't know, man, I think you're maybe like where's a
how does a Hurrah Mazda fit into this kind of shit?
Like that just seems like a weird statement by a
guy who hasn't read a lot about world religion.

Speaker 3 (01:15:23):
I feel like this whole fucking thing is like dude
was on ketamine and just like writing down whatever came
to mind, like whether it linked together or not?

Speaker 2 (01:15:33):
Yeah, yeah, I don't I don't know, yeah, because it
just doesn't. It feels very college level philosophy to me.
And it also feels like a guy who's trying to
justify being an asshole to other people and manipulating them
as like this is the only way that human beings work?

Speaker 3 (01:15:52):
Wait, is he the scapegoat? Like is poor little I
think he's afraid he could be.

Speaker 2 (01:16:00):
I think he's afraid he could be. Right. I think
that's kind of what's going on here, is that, like
fundamentally he is try it part of why he's into right,
wing politics is he wants to make sure he never
is that there's got to be a scapegoat, and it
might be him if he's not careful. So he's going
to make sure it's someone else.

Speaker 3 (01:16:18):
Right, So it's cruelty, is the point, but like in
a good way.

Speaker 2 (01:16:25):
Yeah, yeah, yep, I think that might be it anyway.

Speaker 3 (01:16:32):
Yeah, this is the stun silence that means right now.
I mean, this is fucking dark and weird, even for
this show.

Speaker 2 (01:16:40):
I'm sorry, Yeah, it's it's it's getting into Peter Thiel's head.
Is not a comfortable place to be. I don't like
it here.

Speaker 1 (01:16:47):
Yeah, he's not just a weirdo. He's a sicko.

Speaker 2 (01:16:51):
He is a sicko. He's a sicko or all of
this is part of some cunning lie that he told
a bunch of interviewers over years and case he's even
more of a sick times too.

Speaker 3 (01:17:04):
Yeah there's Stephen King. Yeah yeah, he's creating like that
weird hotel in Colorado or whatever.

Speaker 2 (01:17:12):
Yeah, he's not Stephen King.

Speaker 1 (01:17:15):
Nobody's Stephen King. Stephen King isn't even Stephen.

Speaker 2 (01:17:18):
King, No, not since he quit the blow. Well that's
why we're not going to get a Kujo sequel anytime soon,
unless there's Yeah, oh I do want to see Peter
Peter Teal right, oh man, that could have been his
that might have been what made him, would have made

(01:17:39):
him happy?

Speaker 1 (01:17:39):
And what We're only halfway through the saga, Robert uh huh.

Speaker 2 (01:17:43):
Yeah, oh cool. We haven't even gotten really to Palante here,
We've just laid the groundwork. Wait, maybe Trump is Kujo
to Yeah, Trump, Trump's his Kujo. That's right, that's right,
And that Peter Teal doesn't remember writing him. Yeah, it's
my favorite Stephen King fact.

Speaker 3 (01:18:03):
Is that true? Yeah?

Speaker 2 (01:18:04):
Yeah, I think the quote from him was something like,
Kusho is a great book. I wish I could remember
writing it.

Speaker 3 (01:18:09):
It was.

Speaker 2 (01:18:09):
It was when he was really on the stuff, you know,
for him? Yeah, hell yeah, man. That's how you know
you're one of the greats. If you write Kusho while
fucking snowblinkes.

Speaker 3 (01:18:23):
That's incredible.

Speaker 2 (01:18:24):
Yeah, that's fucking awesome. Everyone go read the Stephen King book. Noah,
you got anything you want to push.

Speaker 3 (01:18:32):
Now, you can find me at Noah Shackman. That's n
O A H s h A A c h T
A man on your social platforms I write for a
bunch of different places, is Rolling Stone, Wired, New York,
Meg and even got some for The Times coming up.

Speaker 2 (01:18:49):
Hell yeah, hell yeah, excited, Thank God, No no, And listen, folks,
if you're at home, don't do cocaine. Just go to
your nearest gas station and asked them for whatever pill
has the most amphetamines in it.

Speaker 4 (01:19:05):
That or don't take it.

Speaker 2 (01:19:07):
There's one called addies like add are all, but it's
just a ship lit a caffeine and B twelve. Oh yeah,
the kind of ship that's legal to sell as energy
pills is amazing. Creative is the best. Imagine if someone

(01:19:28):
imagine if someone took OxyContin and then just made it
so it couldn't easily kill you, and also it was
sold unregulated in every gas station in the United States.
That's creatim That's good stuff. Yeah, it's what I take
it all the time. It's wonderful. Love it's it's a

(01:19:48):
little bit caffeine, a little bit pain killery, but it
won't shut down your lungs like it's not a central
nervous system. Depress it. It won't kill you in the
same way that opiates d It's great.

Speaker 3 (01:20:05):
I love it.

Speaker 2 (01:20:06):
Be careful with it, though, folks, it is a drug.

Speaker 6 (01:20:12):
Behind the Bastards is a production of cool Zone Media.
For more from cool Zone Media, visit our website Coolzonemedia
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Speaker 1 (01:20:23):
You get your podcasts.

Speaker 4 (01:20:24):
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Speaker 6 (01:20:30):
Subscribe to our channel YouTube dot com slash at Behind
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