Peter Thiel Was Right About Socialism—Wrong About the Cause

Peter Thiel blames a "broken generational contract"... but it's mostly just demographic change.

In January 2020, Peter Thiel sent an email to Mark Zuckerberg, Marc Andreessen, and other tech leaders that has since gone viral.

Source: Internal Tech Emails

His warning was prescient:

“When 70% of Millennials say they are pro-socialist, we need to do better than simply dismiss them by saying that they are stupid or entitled or brainwashed; we should try and understand why.” (R)

Thiel’s prediction proved eerily accurate. In November 2025, democratic socialist Zohran Mamdani won the New York City mayoral race, bringing socialism to the doorstep of America’s financial capital.

Source: 2019 VOC Poll

The billionaire class is scrambling for explanations. Thiel offered one: housing and student debt.

“From the perspective of a broken generational compact,” he wrote, “when one has too much student debt or if housing is too unaffordable, then one will have negative capital for a long time and/or find it very hard to start accumulating capital in the form of real estate; and if one has no stake in the capitalist system, then one may well turn against it.” (R)

In a 2025 interview with The Free Press, Thiel expanded on this thesis.

He noted that strict zoning laws have been good for boomers (watching their properties appreciate) but terrible for millennials who can’t buy homes.

“If you proletarianize the young people,” he warned, “you shouldn’t be surprised if they eventually become communist.” (R)

Thiel is right about the phenomenon: The socialist drift among younger generations is real, measurable, and accelerating.

But his explanation (economic materialism) is almost certainly wrong. And his implied solutions will either make the problem worse or have no meaningful effect in solving the problem.

Quick rant: We need to fix the housing market and student debt fiasco. The best way to fix these isn’t with blanket handouts and stupidity: (1) YIMBY (accomplishes nothing if you don’t allow organic SES sorting and severely punish criminals) and (2) Forgive all student loans (just keeps the problem going… kids keep taking out mega loans, selecting moronic majors at expensive universities, universities keep charging more and become bloated with useless staff/majors, then gov bails students out. This dynamic needs to be obliterated).

My solutions to those specific problems?

1. Housing: Deregulation + zero government subsidies (organic SES sorting) + brutal crackdowns on crime (you can’t have “YIMBY” without cutthroat law enforcement or you just get flight of the competent).

2. Student loans: Zero government loans (private lenders only). Private lenders won’t give out loans unless applicant has high test scores (e.g. SAT/ACT/GPA) and selects a smart major. This fixes pricing and bloat and nukes most garbage majors out of existence. Why? University bloat cannot be sustained if the kids aren’t getting loans to pay exorbitant fees. They’ll be forced to cut dead weight: win-win.

Related: The U.S. Housing Crisis: YIMBY, Immigration, Singles

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Part I: Democrats and Republicans are Far Detached from what Built America

Before diagnosing why young people are embracing socialism, we need to understand what we’re actually measuring.

The standard framing: right wing equals free markets, left wing equals big government— is directionally true but extremely misleading.

Both American political parties are extraordinarily far from what built the country.

The Frontier Ethos (built America from nothing):

1. Minimal/no government beyond basic defense and courts

2. Low/no taxes

3. No welfare state whatsoever

4. “You work or you die” — literal survival pressure

5. Minimal regulations

6. Individual responsibility, not collective provision

7. Self-reliance as the core operating principle

8. Tough on crime and strong property rights

The settlers who crossed the Atlantic in the 1600s through 1800s operated under these conditions. There was no safety net. You made it or you didn’t.

This brutal filter selected for specific traits: delayed gratification, risk tolerance, self-reliance, distrust of authority, and willingness to accept consequences for your choices.

How far have BOTH parties drifted?

The Democratic drift is obvious and openly celebrated.

The party explicitly campaigns on expanding government:

Medicare for All, free college, student loan forgiveness, Green New Deal, universal pre-K, expanded child tax credits, wealth taxes.

The 2020 and 2024 platforms represented the furthest-left major party positions in American history. Democratic governance has brought welfare spending from 1.2% of GDP in 1964 to over 5% today. (R)

The Republican drift is less discussed but equally real. Consider what “conservative” now means:

1. Social Security: Created by FDR, opposed by Republicans. Now untouchable — Republican voters are its strongest defenders. Trump explicitly promised not to cut it.

2. Medicare: Created by LBJ, opposed by Republicans. Now untouchable. Trump ran on protecting it.

3. Farm subsidies: $30+ billion annually. Republican stronghold states are the primary beneficiaries.

4. Military spending: Over $800 billion annually, larger than the next ten countries combined. Republicans consistently vote to increase it. No focus on maximal efficiency.

5. Tariffs and industrial policy: Trump’s signature economic policies were protectionism and government intervention to favor specific industries — the opposite of free markets. Related: (1) Trump Tariffs and MAGA Socialism & (2) Trump’s Economic Delusions.

6. Federal debt: Exploded under Reagan, Bush, and Trump. No Republican president since Coolidge has actually shrunk government.

The “small government conservative” barely exists in practice. Republican voters support Social Security and Medicare at rates similar to Democrats.

They support tariffs and protectionism. They oppose cutting military spending. The median Republican voter is not a libertarian—they’re a nationalist who wants government to help their people rather than other people.

Quantifying the drift:

1. Federal spending (% GDP) Frontier: <3% | 1960: 17% | Today: 24% (Trend: ↑ Both parties) (R)

2. Welfare spending (% GDP) Frontier: 0% | 1960: 1.2% | Today: >5% (Trend: ↑ Primarily D)

3. Population receiving benefits Frontier: ~0% | 1960: ~15% | Today: 49% (Trend: ↑ Both parties) (R)

4. Federal employees Frontier: <50k | 1960: 2.4M | Today: 2.9M (Trend: ↑ Both parties) (R)

5. Regulatory pages (Federal Register) Frontier: 0 | 1960: 14,000 | Today: 90,000+ (Trend: ↑ Both parties) (R)

6. National debt (% GDP) Frontier: <5% | 1960: 53% | Today: 120%+ (Trend: ↑ Both parties) (R)

When I say Hispanics voting Democratic at 60%+ for 50 years is evidence of dispositional preference for redistribution, I’m using Republican voting as a proxy for “more frontier-aligned.” This requires justification — and important caveats.

The current alignment

Frontier Drift Index (FDI): Here’s a simple way to quantify how far each party is from frontier assumptions.

First, the U.S. is structurally far from “frontier government”: federal net outlays are about ~23% of GDP in the modern era. (R)

Second, party coalitions differ sharply on how much they want government to do:

• Dem/lean Dem: 74% for a bigger government, 76% say government should do more to solve problems, 82% say business regulation is necessary, 76% say government aid to the poor does more good than harm, and 72% say government should do more for the needy even if it increases debt (average ≈ 76% “big/activist government”). (R)

• Rep/lean Rep: 20% for a bigger government, 28% say government should do more, 33% say regulation is necessary, 34% say aid to the poor does more good than harm, and 33% say do more for the needy even if debt rises (average ≈ 29.6%). (R)

FDI formula (transparent and repeatable):

FDI = 70% institutional drift + 30% coalition drift, where institutional drift is approximated as 1 − (3% / 23%) ≈ 87% (frontier baseline ~3% vs modern ~23%).

1. Republicans ≈ 0.70×87 + 0.30×29.6 ≈ ~70% drift

2. Democrats ≈ 0.70×87 + 0.30×76 ≈ ~84% drift

This supports the idea that the Democrats are further out of touch with the original American ethos (what built it up from ground zero).

Republicans are directionally closer to frontier values on:

1. Tax rates (favoring lower)

2. Regulations (favoring fewer)

3. Welfare expansion (generally opposing)

4. Government size rhetoric (if not practice)

5. Individual vs. collective responsibility framing

6. Market solutions vs. government solutions

Democrats are directionally further from frontier values on:

1. Explicit redistribution policies

2. Expanding government programs

3. Collective provision framing

4. Viewing inequality as inherently unjust

5. Trusting government to solve problems

This is why using “Republican voting” as a proxy for “frontier-aligned” is reasonable at this moment in history.

A population that consistently votes 60-40 for the party of expanded redistribution is revealing a preference for redistribution.

Party labels are contingent, not permanent.

“Republican” and “Democrat” are just labels for the two major parties in a winner-take-all electoral system.

The coalitions they represent have changed dramatically over time:

• Republicans were the party of Lincoln and Reconstruction; Democrats were the party of the Confederacy and Jim Crow

• Democrats were the party of urban machines and working-class Whites; now they’re the party of educated professionals and minorities

• Republicans were the party of free trade and internationalism (Bush); now they’re the party of tariffs and “America First” (Trump)

The parties could realign again. If Republicans become fully populist-nationalist (embracing industrial policy, tariffs, and entitlement protection) while Democrats become the party of technocratic neoliberalism, the “closer to frontier” designation could flip.

What matters is the underlying positions, not the party label.

The stable finding is:

Hispanic voters consistently support the party offering more redistribution and government provision, regardless of label.

For 50+ years, that’s been Democrats. If Republicans became the redistribution party, Hispanic voters would likely follow — as they did in Latin American countries where right-wing parties embraced populist economics.

The voting pattern reveals the preference. The preference is for redistribution. The party label is incidental.

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Part II: Why Thiel’s Explanation Fails

California Case Study

If housing unaffordability and student debt were driving socialist sentiment, we’d expect the political shift to follow the affordability crisis. It doesn’t.

California provides the clearest case study.

1. The state went from being a Republican stronghold (winning 9 of 10 presidential elections from 1948 to 1992) to a permanent Democratic lock. (R)

2. Republicans held 23 of 45 U.S. House seats in California in 1994. Today they hold just 9 of 52. (R)

This transformation tracked demographic change, not housing prices.

• Between 1980 and 2000, California shifted from two-thirds White to about 47% non-White, with the bulk of the increase in the Latino community. (R)

• Non-Hispanic Whites went from 76.3% of California’s population in 1970 to 33.7% in 2022. (R, R)

The political transformation followed the demographic transformation — not the housing crisis.

Young People Are Objectively Well-Positioned

If material conditions drove political preferences, Gen Z should be the most pro-capitalist generation in history.

The S&P 500 has returned 655% since 2010 — roughly 13.86% annually, one of the three major bull runs in 150 years of market history. Gen Z is entering adulthood knowing nothing but a bull market.

The “Great Wealth Transfer” will see $84-$124 trillion pass from Boomers to younger generations by 2045. (R)

Gen Z is projected to become the richest generation in history.

By any objective measure, young people today live better than kings of old — smartphones, streaming, air conditioning, modern medicine, abundant food, global connectivity.

If material conditions drove socialism, Gen Z should be celebrating capitalism. Instead, they’re its harshest critics.

Related: Gen Z vs. Boomers: Who Had It Harder?

The Expectation Gap Is Perceptual

Thiel is right that there’s a gap between expectations and reality. But the gap is perceptual, not material.

Gen Z adults say they need $587,797 annually to consider themselves “successful”—10x their actual median income of roughly $57,000. (R)

Millennials report needing $180k+ per year to “feel happy.” (R)

This isn’t a housing problem. It’s an Instagram, TikTok, Snapchat problem. Fixing housing won’t fix distorted perceptions.

We even have prominent figures like Michael Green claiming the U.S. poverty line is $140k!

They’ve fallen for the combo of the: MSM psychological trap, social media trap, and pathological empathy trap… against better judgment and common sense.

Read: No, $140k is Not the Poverty Line

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Part III: My Hypothesis (The Alternative)

Socialist drift is driven by multiple factors, but they’re not equally important.

I rank order them by estimated impact.

PRIMARY

• 1. Demographic composition shift Why: Changes WHO the electorate is

MAJOR

• 2. Differential birth rates Why: Compounds #1 even without immigration

• 3. Unselected immigration Why: Accelerates #1 and #2

SIGNIFICANT

• 4. Media/academic capture Why: Provides messaging to receptive audience

• 5. Social media wealth distortion Why: Creates perceived deprivation

MODERATE

• 6. Entitlement ratchet Why: Locks in gains, prevents reversal

• 7. Hedonic adaptation Why: Makes prosperity feel insufficient

MINOR

• 8. AI/automation anxiety Why: New channel for old preferences (will likely increase as AI becomes more powerful)

The first three are PRIMARY + MAJOR because they change the composition of the electorate itself.

The rest are secondary (SIGNIFICANT + MODERATE/MINOR) — they shape how dispositions are expressed and reinforced, but they operate on an electorate whose baseline preferences are set by composition.

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DRIVER 1: Demographic Composition Shift (PRIMARY)

This is the central driver. Everything else is secondary.

The Voting Pattern IS the Evidence

Here is a fact that cannot be disputed:

Hispanics have never majority-voted Republican in any presidential election since exit polling began.

Not once. Not for Reagan. Not for either Bush. Not for Trump at his historic high point in 2024.

The historical record shows Hispanics voting 57%+ Democratic consistently since 1984.

This pattern holds across:

1. Different Republican candidates (Reagan, Bush, Romney, Trump)

2. Different economic conditions (recessions, booms, stagflation, growth)

3. Different issues (immigration-focused campaigns vs. not)

4. Different states (California, Texas, Florida, Arizona, Nevada)

5. Different generations (immigrant, second-generation, third-generation+)

What about the 2024 Presidential Election (Trump vs. Harris)?

The 2024 American Electorate Voter Poll: Latino Voters by State. (R)

1. California: Harris 66% vs. Trump 33%

2. Texas: Harris 60% vs. Trump 38%

3. Florida: Harris 43% vs. Trump 56%

4. Arizona: Harris 63% vs. Trump 36%

5. Nevada: Harris 64% vs. Trump 35%

Trump’s 2024 performance—widely celebrated as a breakthrough—got him between 42% of the Hispanic vote (R) and 46% of the Hispanic vote (R) — depending on the poll you use. This was predictable.

50 years of revealed preferences.

• Actual voting behavior with actual consequences. Across different candidates, issues, economic conditions, and states. The pattern doesn’t drift.

• This is not a small sample. This is not a fluke. This is the most robust dataset we have for measuring group political preferences.

• What would we expect if the preference were environmental — shaped by party behavior, historical accident, or cultural factors that could shift?

• We’d expect drift over 50 years. Economic conditions changed dramatically.

• Candidates ranged from moderate (McCain, Romney) to populist (Trump).

• Issues emphasized varied from immigration restriction to immigration reform. The pattern should have drifted if it were circumstantial.

It didn’t drift.

Currently, “Republican” is the party more aligned with frontier values — lower taxes, less redistribution, more individual responsibility.

Pew shows these “role of government” preferences vary sharply by race/ethnicity even before you get to party labels:

1. White adults (54%) are most likely to say government is doing too many things better left to businesses/individuals vs. Hispanic adults (29%) say the same. (R)

2. Even inside the GOP coalition, Pew finds Hispanic Republicans are far more pro-government than White Republicans: 58% of Hispanic Republicans say government should do more to solve problems vs. 21% of White Republicans. (R)

The parties could theoretically realign, and labels are contingent (as was mentioned earlier). But for the past 50 years, consistent Democratic voting reveals consistent preference for the more redistributive option.

The burden of proof is on those claiming the pattern is environmental or cultural.

They cannot point to any election where Hispanics majority-voted for the less-redistributive party. The counter-evidence doesn’t exist.

Genetic Dispositional Differences (Mean/Median)

Important: (For the idiots out there.) This does NOT mean every Hispanic votes against Frontier Aligned values and is a Democrat. This is about evolved trait distributions (means, medians, tails). We have ample evidence that Hispanics’ preferences tend to be socialism, communism, redistribution, soft on crime, etc. This is observed historically and presently in the U.S. and global diaspora.

The pattern suggests dispositional (genetic) tendencies that favor:

1. Collectivism over individualism. Extended family networks, community orientation, group loyalty over abstract principles. This translates politically to comfort with collective provision.

2. Social conservatism combined with fiscal liberalism (SCAFFLE). Traditional values around family, religion, gender roles—but also expectation that government should provide economically. This is the modal Hispanic voter profile. They may oppose abortion while favoring wealth redistribution. When they do vote Republican, it’s for populist-nationalist candidates (Trump), not free-market conservatives (Romney).

3. Present-orientation over future-orientation (faster life strategy). What can government do for me and my family now, rather than abstract arguments about how free markets produce prosperity over decades. The appeal of immediate, concrete redistribution over abstract, long-term optimization.

4. Lower engagement with second-order effects. Understanding “tax the rich” is easy. Understanding “wealth inequality drives innovation which creates prosperity for everyone” requires abstract reasoning about systemic effects that aren’t intuitive. The first argument wins because it’s simpler.

This isn’t speculation. It’s observable in the global pattern.

The Global Hispanic Diaspora Pattern

This preference pattern isn’t unique to the United States.

It appears everywhere Hispanic populations are politically organized:

• Venezuela: Voted for Chavez’s socialism repeatedly until economic collapse.

• Argentina: Repeated cycles of Peronist redistribution → economic crisis → brief reform → back to Peronism.

• Mexico: PRI dominated for 70 years with corporatist redistribution; current AMLO/Morena government is explicitly redistributionist.

• Bolivia, Ecuador, Nicaragua: Similar patterns.

The pattern is as follows:

1. Favor socialist/redistributive policies →

2. Policies fail and create economic disaster →

3. Emigrate from the disaster →

4. Vote for similar policies in the new country

Not a single Hispanic-majority country has sustained frontier-style capitalism. The preference travels with the population.

The Selection Exception (And Why It Proves the Rule)

Cuban Americans vote more Republican (56-41 for Trump in Florida 2024). Venezuelan Americans similarly lean right.

This is a selection effect. People who fled Castro’s communism were self-selected for anti-communist preferences. The act of leaving filtered for ideology.

But this exception proves the rule for two reasons:

1. First, they’re statistically irrelevant nationally. Cuban Americans are roughly 2 million people out of 36+ million eligible Hispanic voters—approximately 5% of the Hispanic electorate. They can swing Florida but are a rounding error nationally. Citing Cubans as evidence against the broader pattern is innumerate.

2. Second, and more importantly, the selection effect doesn’t persist. The children of Cuban refugees are reverting to the Hispanic mean. Second-generation Cuban Americans—children of people who literally fled Castro—have been documented preferring Democratic and Socialist candidates. (R)

If Whites were the only voters, Mamdani would’ve lost (45%).

Predictably, Mamdani won with Blacks (57%), Hispanics/Latinos (52%), and Asians (62%).

Source: CNN

This is devastating to the “cultural transmission” counter-argument. If anti-communist values were effectively transmitted culturally, second-generation Cuban Americans would maintain those patterns. They’re not.

There’s evidence of this in other racial/ethnic groups too (parents flee socialism/communism → kids vote for socialism/communism).

1. The City NYC: Their Families Fled Soviet Socialism. Now They’re Knocking Doors for Mamdani.

2. NY Times: In Chinese American Families, There’s a Generational Split on Mamdani.

The selection effect only works on people who directly experienced socialism. Their children, not subjected to that selection pressure, revert to the baseline distribution.

This is exactly what you’d expect if political preferences are genetically dispositional rather than cultural. Selection can temporarily shift a subpopulation. But without continued selection pressure, reversion to the mean occurs in the next generation. If it were cultural, the values would transmit across generations. They don’t.

I know this isn’t what many people want to hear. Many enjoy telling themselves lies or embellishing the magnitude of assimilation to virtue signal “all racial/ethnic groups are like this!”

The Assimilation Paradox

Hispanic Americans are assimilating on many dimensions:

• Language acquisition: second and third generation speak fluent English

• Intermarriage: rates increasing with each generation

• Cultural markers: music, food, holidays blending into mainstream

But assimilation is NOT happening on voting patterns.

Multi-generational Hispanic Americans (families in the United States for three or four generations) still vote Democratic at similar rates to recent immigrants.

The specific variable that matters for political outcomes isn’t assimilating. Everything else is.

Why Racial Composition Is Primary

Changing the composition of the electorate changes outcomes even if no individual changes their mind.

Simple arithmetic: If Group A votes 60-40 for Party X, and Group A grows from 15% to 30% of the electorate, Party X gains vote share mechanically. No persuasion required. No policy change required. Just demographic math.

This is why composition is the PRIMARY driver. Media, academia, and social media shape how preferences are expressed, but the baseline preferences are determined by who’s in the electorate.

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DRIVER 2: Differential Birth Rates (MAJOR)

Even with zero immigration, demographic composition would shift due to differential birth rates.

The Numbers

Birth rates per 1,000 women (2019): (R)

• Non-Hispanic White: 9.8 (lowest of any group)

• Hispanic: 14.6

• Black: 13.4

Total fertility rate (children per woman): (R)

• White: 1.6-1.8 (below replacement of 2.1)

• Hispanic: ~2.4 (above replacement)

In 2016, for the first time in U.S. history, White deaths exceeded White births. (R)

1. The White “natural loss” was 39,000 in 2016, compared to a natural gain of 393,000 in 1999.

2. The birth-to-death ratio for Whites fell from 1.21 in 2000 to just 0.98 in 2016.

3. Whites accounted for 77.7% of all U.S. deaths but just 53.1% of births.

What This Means

Demographic composition shifts even with closed borders.

You could build a wall from sea to sea and demographic composition would still change due to differential fertility.

Immigration accelerates what differential fertility would do anyway. Both mechanisms push in the same direction. Closing immigration slows the shift but doesn’t stop it.

This is why birth rates are ranked as MAJOR, second only to composition itself. It’s the engine that keeps composition shifting even if immigration stopped tomorrow.

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DRIVER 3: Unselected Immigration (MAJOR)

Mass immigration compounds the fertility effect by adding populations with redistribution preferences faster than natural increase alone.

Selected vs. Unselected

Selected immigration (what built frontier America):

1. Crossing the Atlantic in the 1600s-1800s with no safety net

2. Multi-year voyages, high mortality, no guaranteed outcomes

3. Frontier conditions on arrival: you work or you die

4. Brutal filter for: risk tolerance, self-reliance, future orientation, willingness to defer gratification

5. Those who couldn’t hack it died or went back

This selection pressure created a population with specific traits. Current White Americans are mostly descendants of these ultra-selected settlers.

Unselected immigration (current policy):

1. No filter for political ideology

2. No filter for economic philosophy

3. No filter for cognitive ability

4. No filter for frontier ethos

5. Brings baseline population distribution of origin countries

The country is already built. New arrivals gain voting rights without necessarily understanding or sharing the ethos that built American prosperity.

The Mechanisms

Demographic change happens through many channels:

1. Naturalized citizenship

2. Chain migration (family reunification)

3. Birthright citizenship (automatic citizenship for anyone born here, regardless of parents’ status)

4. Amnesty programs (starting with Reagan’s 1986 amnesty)

5. Sanctuary cities and states

6. Work visa overstays

7. Asylum claims (often economic migrants rather than genuine refugees)

8. Expedited processing under certain administrations

Each mechanism adds to the electorate without filtering for frontier values.

The “Americans” Problem

Many current “Americans” are Americans only in the legal sense.

They hold citizenship (through birth, naturalization, or amnesty) without holding the values that citizenship historically implied.

The founders assumed citizens would be the kind of people who built the country or their descendants.

They didn’t anticipate a system where citizenship could be acquired by:

• Being born on U.S. soil regardless of parents’ situation

• Waiting out a residency period

• Qualifying for amnesty

• Chain migration from a single anchor relative

The result: An electorate that includes millions who gained voting rights without ever assimilating to the founding ethos — and who may not understand what policies enabled American prosperity in the first place.

Abstract vs. Concrete Reasoning

Frontier capitalism requires understanding abstract, long-term concepts:

• Delayed gratification at societal level

• Why letting successful people keep wealth benefits everyone long-term

• Why government intervention creates perverse incentives

• Second and third-order effects of policy

These concepts aren’t intuitive. The immediate, concrete appeal of “take from the rich and give to me” is much easier to grasp than “wealth inequality drives innovation which creates prosperity for everyone over decades.”

Populations that favor immediate, concrete redistribution over abstract, long-term optimization will vote for redistribution. Mass unselected immigration brings such populations without filter.

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DRIVER 4: Media and Academic Capture (SIGNIFICANT)

Demographic composition creates an electorate receptive to redistribution messaging. The media-academic complex provides that messaging constantly.

The Academic Pipeline

Between 1969 and 1998, faculty identifying as left or liberal remained relatively stable at around 44%. Beginning in 2001, professors on the political left began approaching a supermajority. (R)

Democrat-to-Republican (D:R) ratios by field: (R)

1. Engineering: 1.6-to-1

2. Economics: 4.5-to-1

3. History: 33.5-to-1

4. Communications: 56-to-0

5. Interdisciplinary studies: 108-to-0

6. Gender studies, Africana studies, peace studies: 0 Republicans found

At Williams College: 132:1 D:R ratio. (R)

Administrators are even more liberal than faculty.

Programs like “Stay Healthy, Stay Woke” and “Understanding White Privilege” signal which views are acceptable.

Conservative students learn to hide their views or avoid academia, reinforcing the imbalance.

The “Peer Reviewed” Problem

This homogeneity corrupts knowledge production:

• Liberal academics produce studies supporting redistributive policies

• Studies are framed as neutral, peer-reviewed science

• But peer review means review by ideologically similar peers

• Topics confirming liberal priors get studied and funded

• Counter-evidence is understudied

• Conservatives are studied as pathology, not engaged as legitimate viewpoint

The debunking lag: It takes years to rebut each flawed study. But new studies are produced constantly. By the time one is discredited, ten more have been published. The spam overwhelms the correction.

Note: This is why I proposed “Truth Tiers” to keep the wokes honest. I suspect many “Pseduo Truths” are contaminating science and AI models. I’ve explained the social dynamics in “Game Theory of Silence.”

The Media Pipeline

Journalists are trained in captured institutions. They learn to see wealth inequality as self-evidently unjust and redistribution as self-evidently good.

The pipeline: University → Media → Policy → Public Opinion → Elections

At each stage, the redistributive frame is reinforced. “Experts say...” almost always means liberal-trained academics. Counter-narratives are excluded from legitimate discourse.

The Billionaire Demonization Campaign

The standard narrative frames billionaire wealth as hoarded loot rather than productive capital.

Billie Eilish claims Elon Musk could:

“End world hunger, save critically endangered species or even rebuild Gaza entirely.” (R)

Reality: Musk’s wealth is Tesla and SpaceX stock — already deployed, funding EVs, space exploration, satellite internet, neural interfaces. It’s not sitting in a vault. When he sells, he pays capital gains. The “3%” figure compares unrealized gains (paper wealth) to cash income — deliberately misleading. And paying over 3% in taxes is still a lot of money going to the gov who mostly just wastes it!

But the narrative is set by the MSM and politicians (Bernie, AOC, Pocahontas):

Billionaires are hoarding your wealth. Let’s take more from them.

What none of the mentally challenged celebs like Eilish understand is that the main driver of human advancement and innovation is the innovators themselves.

What’s Never Explained

The case FOR wealth inequality in free markets is systematically suppressed.

1. Wealth inequality incentivizes innovation

2. Billionaire capital is already deployed productively (not hoarded)

3. Government spending is less efficient than private investment

4. Redistribution kills the goose that lays golden eggs

5. A basic safety net plus letting entrepreneurs keep the rest produces better outcomes

In mainstream discourse, wealth inequality is treated as self-evidently immoral, and the pro-market case for it is basically forbidden: make it and you’re branded a Scrooge, a shill, or morally defective. But in a real free-market system—equal rights, rule of law, competition, and low corruption—high inequality can be a feature, not a bug, because it’s the payoff structure that funds risk and pulls talent into hard problems. The massive upside is what makes people spend years failing, grinding, and reinvesting until something finally scales.

Most “billionaire wealth” isn’t cash sitting in a vault; it’s ownership in productive systems—companies, factories, platforms, infrastructure, R&D—and markets punish idle capital. Even what critics call “hoarding” is usually just not consuming: it’s invested, reinvested, used to fund new ventures, and absorbed as risk capital.

Redistribution, by contrast, often shifts money from compounding investment into short-horizon consumption and political allocation. Private capital is disciplined by profit and loss; government spending is disciplined by politics, perverse incentives, and low accountability. Heavy redistribution doesn’t just move money—it changes behavior by shrinking the return on innovation and pushing more energy into bureaucracy, lobbying, and safe rent-seeking instead of building.

This is where socialism/communism (and “soft” versions of it) predictably fail: the state becomes the main allocator, incentives get replaced by committees, price signals get distorted, and ambitious people optimize for political status rather than invention. You don’t get builders—you get managers.

And the core principle people dodge: if someone creates wealth legally, it’s their right to keep it, invest it, “hoard” it, or pass it to their kids. That’s property rights. The government already takes a huge cut through layers of taxation; the idea that everyone else has an unlimited moral claim on the output of the most productive is just entitlement dressed up as ethics.

The best setup is a strong floor and a huge ceiling: a basic safety net, hard anti-corruption/anti-crony enforcement, then let builders keep most of the upside—because that upside is the engine that makes progress compound.

Related: Trickle Down Economics Works

The Boomer-Blame Narrative

“Boomers ruined everything. Boomers pulled the ladder up. Boomers are selfish.”

This creates intergenerational resentment that translates into openness to redistribution.

If you are wrongfully psyopped into thinking the prior generation stole from you, you feel justified in demanding that the government take it back.

Related: In Defense of Boomers

Active Marketing of Redistribution

Democrats explicitly run on a combination of:

1. Giving away free stuff (funded by other people’s hard work/money): They are taking from someone who worked/labored.

2. Woke entitlement politics (making people feel as though everything is a “human right”… soon it will be trips to Mars): Telling you that you are entitled to receive free labor from another person.

This is grievance as electoral strategy: Identify something people want, promise to take it from the rich, create a voting bloc dependent on continued redistribution.

Note: This gets far bigger when you think of the organizations (e.g. businesses, charities, NGOs, et al. who receive government money then dedicate a % of that money to elect/re-elect individuals who promise to give them more government money)! It’s a complete full-circle racket.

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DRIVER 5: Social Media Wealth Distortion (SIGNIFICANT)

Social media creates perceived deprivation independent of material conditions.

The Perception Gap

Gen Z adults say they need $587,797 annually and a $9.46M net worth to feel successful. (R)

Millennials need $180,865 annually and a $5.29M net worth to feel successful. (R)

Social media is giving people (especially younger generations) a sense of “money dysmorphia.” (R)

The Mechanism

Social media algorithms prioritize aspirational content. Influencers display sponsored and gifted lifestyles as “normal.” Constant exposure creates a false baseline.

Everyone on Instagram seems rich. It’s a mirage—sponsored content, gifted products, carefully staged photos. But the perception is real: “Everyone is rich except me.”

Political Consequence

Perceived deprivation creates resentment toward “the system” and openness to redistribution—even among the objectively prosperous.

This is why Thiel’s solution fails. Even if you fix housing, the perception problem remains.

People who feel poor vote for redistribution regardless of actual material conditions.

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DRIVER 6: The Entitlement Ratchet (MODERATE)

Government programs only expand. They never contract.

The Mechanism

Each expansion creates constituencies that defend it. Social Security recipients vote to protect Social Security. Medicare recipients vote to protect Medicare. Student loan forgiveness recipients vote for more forgiveness.

Reversals become politically impossible. You can never put the cat back in the bag.

The Numbers

• 1964: Welfare programs consumed 1.2% of GDP

• Today: Over 5% of GDP

• 1980s: 30% of population receiving government benefits

• 2011: ~48.5% receiving benefits (R)

No examples exist of successfully rolling back entitlements at scale.

Mindset Expansion

Beyond literal entitlements, the entitlement mindset expands. “Government should provide X” becomes baseline expectation.

Each generation expects more. What was once charity becomes “a human right.”

This interacts with demographic change: populations favoring redistribution vote for expansion, expansion creates dependency, dependency votes for more expansion. Self-reinforcing cycle.

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DRIVER 7: Hedonic Adaptation (MODERATE)

Good times create weak men who demand state protection.

The Unprecedented Bull Market

S&P 500 since 2010: 655% return, 13.86% annually — 1 of 3 great bull runs in 150 years. Gen Z has entered adulthood knowing nothing but rising markets.

Note: Not all of them actually invest. Many engage in conspicuous consumption and thus feel left out of the “winning” because they are unable to delay gratification.

The Adaptation Effect

Rising markets become baseline expectation. Normal returns feel like stagnation. Any decline feels catastrophic.

Previous generations would have celebrated this performance. Gen Z isn’t impressed—their expectations are calibrated to outlier conditions.

The Weakness Problem

A generation with no experience of real hardship expects continuous improvement. They have no resilience from adversity. When conditions worsen, they demand government protection.

Combined with entitlement mindset, this produces a generation expecting government to solve problems previous generations solved themselves.

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DRIVER 8: AI and Automation Anxiety (MINOR)

Genuine uncertainty about the future of work creates openness to UBI and expanded redistribution.

Employment Anxiety

AI, robotics, and automation are advancing rapidly.

Many young people conclude traditional employment may not exist in 20-30 years. If robots do most jobs, what happens to workers?

This drives support for UBI (universal basic income). If work is becoming obsolete, government should provide for everyone directly.

Why Premature UBI Would Be Disastrous

UBI hype is being driven by “AGI soon → jobs gone soon.” That’s counting AI chickens before they hatch.

Even if AGI is real/near, job displacement won’t hit instantly.

Real-world replacement is bottlenecked by deployment costs, reliability, liability, regulation, integration, and (for many roles) hardware/robotics.

Rolling out UBI early isn’t “safe.” It breaks incentives before the crisis exists.

1. Raises the “why work?” threshold and worsens shortages in essential jobs

2. Distorts wages and pushes businesses to automate faster than they otherwise would

3. Forces bad funding choices: growth-killing taxes, debt blowouts, or inflation

4. Becomes politically permanent: “temporary checks” turn into an entitlement state

UBI should be treated as an emergency tool that gets triggered only after sustained proven structural unemployment. It should be kept as minimal as possible to accelerate technological innovation.

Related: Don’t Count Your UBI Chickens Before They Hatch

Same Disposition, New Channel

AI anxiety is a new channel for the old preference: present-oriented, concrete, skeptical of markets, trusting government provision.

Young people worried about automation default to demanding government guarantee income rather than trusting market adaptation.

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Part IV: Synergy of the Drivers

These drivers don’t operate in isolation. They compound.

The Compounding Model

Demographic composition (PRIMARY)
    ↓
Electorate receptive to redistribution
    ↓
Media/academia provides redistribution messaging → Finds receptive audience
    ↓
Social media creates perceived deprivation → Grievance regardless of reality
    ↓
Democratic Party offers policy vehicle: "Vote for us, we'll take from them"
    ↓
Entitlement expansion → Creates dependency constituencies
    ↓
Dependency votes for more expansion → Ratchet continues
    ↓
Hedonic adaptation → Even prosperity feels insufficient
    ↓
AI anxiety → New channel for same preference

The insight: Changing media or academia without changing composition is rearranging deck chairs. The audience’s baseline preferences are set by genetic wiring. Messaging shapes expression, but disposition is primary.

The Arithmetic Inevitability

Let’s assume:

1. Hispanics vote 60-40 Democratic (better than historical average for Republicans)

2. Whites vote 55-45 Republican (roughly accurate)

If electorate is 70% White, 15% Hispanic → Aggregate favors Republicans

If electorate shifts to 50% White, 30% Hispanic → Aggregate favors Democrats

No one changes their mind. Pure composition change produces the shift.

At some point in the future, even winning 100% of White votes won’t produce a Republican majority.

1. California is already there.

2. Nevada is close.

3. Arizona is trending.

4. Texas is further out but on the same predictable trajectory.

The math is inexorable unless voting patterns change… and they haven’t changed in 50 years.

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Part V: Why Thiel’s Solutions Won’t Fix the Socialism Preference

Thiel’s implied solutions (address student debt, fix housing) wouldn’t solve the problem. And they may even accelerate it!

Student Loan Forgiveness Creates Moral Hazard

Forgiveness teaches that choices have zero consequences for both students and universities.

1. Junk degree (gender studies, africana studies, etc.): forgiven

2. Responsible choice (community college, trade school, paid loans): punished

3. Universities: increasing tuition prices, expanding admin bloat, woke major offerings, DEI, etc. (college becomes just an extension of high-school)

Almost half of students already expect forgiveness. (R)

“What’s the message? Borrow as much as you can and wait for the debt to be canceled.” (R)

Loan cancellation creates implicit guarantee that future borrowers won’t pay back.

This drives up demand and prices:

“It won’t just be predatory institutions that raise prices—it will be all of them.” (R)

Federal aid increased 295% since 1991-92; colleges more than doubled tuition. (R)

Forgiveness “does absolutely nothing to rein in costs going forward.” (R)

Worse: Forgiveness recipients become voters for more forgiveness. New dependency constituency. Ratchet moves further wrong direction. Cat never goes back in bag.

Housing Programs Have Same Problems

Government housing involvement (Fannie/Freddie) contributed to 2008 crisis.

Rent control reduces supply. Public housing creates dependency.

And it doesn’t address the actual driver. Hispanic voters with affordable homes in Texas still vote Democratic. Material conditions aren’t causing the pattern.

The Personal Responsibility Problem

Frontier ethos: you make choices, you live with consequences.

Bailouts teach: your choices don’t matter, government will fix it.

This infantilizes adults, creates learned helplessness, and reinforces exactly the mindset driving socialist drift.

Thiel assumes: Fix material conditions → people become pro-capitalist.

Reality: The people themselves have different baseline preferences downstream of evolution/genetics. No material fix changes disposition.

The electorate isn’t temporarily confused. It has different values downstream from genetics. (Genetics → Cognition/Behavior → Culture/Values).

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Part VI: Socialist Drift Prediction

Fixing housing and student debt won’t change socialist drift because the major driver is genetic (demographic / dispositional). Other drivers matter (social media, MSM, institutional capture, etc.) too. But material conditions are not the cause.

Primary drivers:

1. The electorate is compositionally different (more Hispanic, less White) and Hispanics have shown dispositional preference for redistribution stable for 50+ years across all contexts

2. Differential birth rates compound the shift even without immigration

3. Unselected immigration accelerates what fertility would do anyway

Secondary drivers reinforce:

4. Media/academia provides constant redistribution messaging to a receptive audience

5. Social media creates perceived deprivation regardless of actual prosperity

6. Entitlement ratchet locks in each expansion

7. Hedonic adaptation makes good times feel insufficient

8. AI anxiety adds new channel for old preferences

Thiel’s solutions might make it worse depending on which solutions are implemented for things like “housing” and “student loans” (especially if they shirk personal responsibility and create new dependency constituencies).

The selection exception proves the rule: Immigrants who fled communism and socialism revert back to the Hispanic mean/median. Cultural transmission of anti-redistribution values is mostly ineffective. The underlying distribution reasserts itself.

The electoral arithmetic is inexorable: At some demographic composition, frontier-compatible policies become electorally impossible. We may have already passed this threshold in key states. The national tipping point approaches.

The frontier ethos is almost fully bred out through differential fertility and immigrated out through unselected mass migration. Even selected subpopulations see their children revert. No policy fix addresses this.

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Final Take: Peter Thiel vs. Rise of Socialism in the United States

Peter Thiel correctly identified that young people are turning against capitalism.

But he’s wrong about why.

The socialist drift isn’t a bug that can be fixed with better housing policy or student loan relief. It’s a feature of demographic transformation.

Material conditions aren’t destiny. Demographics are. I’ve written about this many times:

1. Racial Composition of the U.S. Predicts Political Preferences & Voting Outcomes

2. Population Genetics Determines Corruption Levels of Countries

3. Debunking “Guns, Germs, and Steel” (Genetic Evolution)

Thiel’s proposed solutions may accelerate the very trend he’s trying to prevent—creating moral hazard, expanding government dependency, and reinforcing the entitlement mindset.

The honest conversation nobody wants to have: the electorate itself is changing in ways that favor redistribution regardless of economic conditions.

The voters demanding socialism aren’t confused about their interests. They’re expressing genetic preferences that have been stable for 50 years.

What comes next is arithmetic. The frontier is closed. The question is what replaces it. Hopefully there won’t be a future Autopsy of America’s Slow Death.