David Perell wrote an article about Peter Thiel recently. I haven’t read extensively on mimetic theory before and want to highlight interesting points from the article below:
Mimetic Theory rests on the assumption that all our cultural behaviors, beginning with the acquisition of language by children are imitative.
Mimetic conflict emerges when two people desire the same, scarce resource. Like lions in a cage, we mirror our enemies, fight because of our sameness, and ascend status hierarchies instead of providing value for society
This seems reasonable. We don’t grow up in a vacuum, and are influenced by family, peers, and media. There are some base human desires (food, water, etc) but many things become desired because we see or are told they’re desirable. If you don’t grow up with a family of horse riders, owning a horse may not be attractive. I’d like to see some research on this, but it’s an interesting argument.
In an email to Ryan Holiday, Peter responded as such: “Contrarians may be mostly wrong, but when they get it right, they get it really right.”
I think this depends on the odds of the game you’re playing. You could apply the above phrase to both Venture Capital and buying a lottery ticket, but most people would think that participating in VC is more justifiable than playing the lottery. So the question then is figuring out what the odds of the game are. That’s the hard part and where you make your money.
Similar people are most prone to Mimetic envy because we tend to compete for status with the people who are closest to us. When two people are different and far away from each other, the tension will stay calm.
There’s research showing a large percentage of people would prefer relative status vs absolute status, i.e. I’d prefer to make $10 and have you make $5 than I make $100 and you $500. I agree that we compare against people that are closest to us, and that our relative position affects our happiness. I disagree that it’s our only source of comparison today though. I hypothesise that back when information travelled slower, we weren’t as envious of the ultra-elites, since we had less idea of what their standard of living was like. Today though, due to a combination of both media snooping and celeb wealth flaunting, we’re well informed of what a rich lifestyle looks like. I think that we now compare ourselves against these far, out of reach people as well, and feel envious that we cannot have the same. In other words, I think that we compete both with people closest, and people furthest from us.
Perell goes on to discuss how students and academics at colleges both face bouts of envy over the pettiest of issues, such as textbook theft. My experience in the workplace, though anecdotal, would also agree with this. You’d be surprised by how much more people care about small things such as free swag vs large things such as minimising taxes on compensation.
According to Thiel, monopoly is the end state of every successful business. If you want to create and capture lasting economic value, don’t compete. The more unique companies are, the more the business world can flourish. Consider Thiel’s favorite example: the airline industry.
I actually want to push back on this. How many businesses are actual monopolies, in the exact sense of owning the entire market they operate in? Google isn’t, even if you exclude China, with Bing and some smaller ones like Duck Duck Go still kicking around. Doing a quick search for “largest monopolies” returns me companies with “near monopolies”, which is not the same. If we do move the goalposts to include companies with large market share, i.e. oligopolies, we do see many lasting profitable firms. But this by definition means your business is not unique.
Girard offers a historical perspective for the transition from cyclical time to linear time. He identified a cyclical loop: First, when a scapegoat is sacrificed, peace is restored in the community. Then, the culture lives peacefully for a short time. But eventually, tensions flare and violence returns to the community. To restore the peace, a new scapegoat must be named and sacrificed, which re-starts the sacrificial loop.
Girard isn’t alone in thinking about cycles. Ray Dalio does, George Soros too, and so did Minsky. The basic framework is similar here, in that things progress up to a point where there’s a triggering moment, and then they revert to a lower starting base, be that the debt level, investor expectations, or stability in a system.
Informed by its linear conception of time and the Christian image of heaven, Thiel applauds the grand visions of yesterday’s leaders.
This makes sense, given Thiel’s comments above that he’d prefer to get things ‘really right’, and his ‘zero to one’ philosophy of preferring innovation over scaling a product.
The Christian statesman or stateswoman knows that the modern age will not be permanent, and ultimately will give way to something very different. One must never forget that one day all will be revealed, that all injustices will be exposed, and that those who perpetrated them will be held to account.
This sounds a bit like Ayn Rand’s Atlas Shrugged? If you are Christian it follows that you believe in a judgement day, and should live your life in accordance. How and what exactly is needed to do so is the question everyone religious has been struggling with.
In Zero to One, Peter Thiel describes four ways of thinking about the future: definite optimism, indefinite optimism, definite pessimism, and indefinite pessimism.
We’ve moved from an atmosphere of utopian promises to one of dystopian threats. Definite Optimism has disappeared. Since the Financial Crisis, tens of thousands of Americans have moved into the Indefinite Optimism and Definite Pessimism quadrants.
I do think the majority of society, especially in the political and economic arena, has moved away from definite optimism. Tyler Cowen wrote about this recently.
That is a common theme of most of the top entries: They are about “ordinary life.” They tend not to be representations of noble ambition, or of a classical or romantic vision of how human beings might achieve greatness.
Are more people becoming disillusioned about the future and our ability to make it better? Where there were once uniting themes across the world e.g. ‘defeat the nazis’, ‘land a man on the moon’, ‘map the genome’, these days it doesn’t seem like major countries have a united push towards a common goal. Perhaps that’s why everyone is now aiming for ordinary rather than greatness? When it seems like the ultimate goal is to gain wealth rather than achieve something special, we copy our peers and aim for pure monetary maximisation instead.
However, I believe definite optimism is still present in some areas, such as startups who have to believe in whatever their grand vision is in order to raise the funding required to get to their desired lifestyle. Regardless of whether they actually believe it, they know that not potraying definite optimism is a death sentence.
Until then, he’ll stagger along the soul-crushing stepping stones of life: work hard in middle school so you can do well in high school; work hard in high school so you can do well in college; work hard in college so you can get a respected job; and get a respected job so one day, towards the end of your career, you can finally do what you want to do. All the while you “build skills” and “accumulate options,” as if the next corner will provide the happiness you’ve been seeking all along.
This has been my experience as well, and I’m still struggling to figure out how to break out. One insight I’ve found is that in all my jobs, the majority of value creation has benefitted my employer, not myself. One reason I started writing publicly was to reduce that gap, and to accumulate more of the upside from my own efforts. TBD on how this is going to work out.
When we pursue optionality, we avoid bold decisions. Like anything meaningful, venturing into the unknown is an act of faith. It demands responsibility. You‘ll have to take a stand, trust your decision, and ignore the taunts of outside dissent. But a life without conviction is a life controlled by the futile winds of fashion. Or worse, the hollow echoes of the crowd.
I think many people pursue optionality so that ‘one day’ they can pursue what they’ve always been interested in. Unfortunately, for many people this transition keeps getting delayed becuase the trade off would be too painful in terms of what they give up in lifestyle.
Thiel says we should acknowledge our lack of progress, dream up a vision of Definite Optimism, and guided by Christian theology, work to make it a reality.
Perell goes on to conclude with some Thiel inspired principles:
(1) create a positive vision for the future[I think Perell meant search for secrets here], (2) be careful who you copy, and (3) follow the Ten Commandments.
“The big secret is that there are many secrets left to uncover. There are still many large white spaces on the map of human knowledge. You can go discover them. So do it.”
Be careful who you copy. If you’re going to follow a role model, find one who you won’t compete with. Don’t look to your peers for answers. Find somebody in a different stage of life who you admire and respect. They should be somebody who defied the status quo and took an independent path.
You won’t figure out what to do by looking at your peers, so don’t copy the people around you.
In other words, there’s enough uncharted territory out there regardless of what sector you’re in, and your goal should be to create something new, rather than copy off peers close to you or other existing ideas. I support the idea of aiming higher, since raising expectations likely has huge positive long term effects. However, I wonder how true it is that unique ideas (1) exist in abundance, and (2) are better than copying an existing idea. Additionally, if memetic theory is accurate, then isn’t everything derivative?
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