Billionaire Peter Thiel says “proletarianizing” young people could make them communists

PayPal co-founder and Silicon Valley venture capitalist Peter Thiel has doubled down on his concerns about the generation gap and the future of capitalism, after a similar warning he made in 2020 proved frighteningly accurate.

Following democratic socialist Zohran Mamdani’s electoral victory as mayor of New York, an email Thiel sent five years ago went viral.

Also read: Zohran Mamdani, democratic socialist, is elected mayor of New York

In correspondence to Mark Zuckerberg, Marc Andreessen and others, he warned:

“When 70% of millennials say they are pro-socialists, we need to do more than simply dismiss them as stupid, spoiled or indoctrinated; we must try to understand why.”

Thiel expanded on these concerns in an interview with The Free Press published Friday, saying that strict zoning laws and building restrictions were good for baby boomers, who saw their property values ​​soar, but were terrible for millennials, who have enormous difficulty buying homes.

“If you proletarianize young people, you shouldn’t be surprised if they end up becoming communists,” he said.

Although Thiel — who supported Donald Trump’s re-election — disagrees with Mamdani’s solutions to New York’s housing affordability problem, he acknowledged that the politician at least talks about the issue more than establishment figures.

He also said he is not sure whether young people are actually more in favor of socialism or if they are just more disillusioned with capitalism.

“So in a relative sense, they’re more socialist, although I think it’s more like, ‘Capitalism doesn’t work for me. Or this capitalism thing is just an excuse for us to be exploited,'” Thiel added.

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Mamdani’s victory highlighted voters’ shift away from Republicans, but moderate Democrats also won with campaigns focused on the cost of living.

The midterm election results were a “wake-up call” for both parties to address the affordability crisis, according to pollster Frank Luntz, who differentiates it from inflation.

Thiel showed some sympathy for voters looking for bold ideas to solve difficult problems, such as student debt and housing costs, that had previously been treated superficially.

These measures, according to him, did not work, leading voters to open themselves to proposals outside the traditional political discourse — including “very left-wing, socialist-type economies”.

As a result, Thiel said he is not surprised that voters turned to Mamdani, although he does not believe his ideas will work.

“Capitalism isn’t working for a lot of people in New York. It’s not working for young people,” Thiel said.

The “socialism of old people”

Thiel also noted that the rise in popularity of socialism among young Americans comes amid a multi-decade period of intense political activity in which people have turned to politics for more solutions to their problems.

Part of this, according to him — who identifies more as a libertarian — is due to the enormous gap between expectations and reality, a gap that has never been greater.

“There are some ways in which millennials are better off than boomers. There are ways in which our society has improved,” Thiel said. “But the gap between the expectations that boomer parents had for their children and what those children were actually able to achieve is simply extraordinary. I don’t think there has ever been a generation where that gap was as extreme as that of millennials.”

When asked if he believes a revolution is on the horizon, Thiel responded that he finds this difficult to imagine, as communism and fascism are typical youth movements.

At the same time, the U.S. demographic aging is marked by fewer young people, who are having fewer children.

“And so we have a gerontocracy. Which means that if the U.S. becomes socialist, it will be more of an old man’s socialism than a young man’s socialism — something more about free healthcare or something like that,” Thiel added. “The word ‘revolution’ sounds very violent and juvenile. And today, if there is a revolution, it will be made by 70-something grandmothers.”