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Peter Thiel on the NSA: Modern day Keystone Cops

Nicole Goodkind
Nicole Goodkind

In 2004, Peter Thiel co-founded Palantir Technologies, a data analysis company that has an estimated value of $9 billion, and works mostly with the government on counter-terrorism, information monitoring and cyber-security. The company is rumored to be behind the capture of Osama bin Laden and has a list of clients that include the U.S. Defense Department, CIA, FBI, U.S. Army, Marines and Air Force. So when Thiel calls the NSA “Keystone Cops,” a reference to the incompetent policemen from old silent films, it’s worth noting.

Is freedom really free?

The trade-off between privacy and security has been a hot topic in the United States for as long as the country has been in existence. The latest controversy focuses on the NSA spying on its own citizens, as well as foreign officials. In 2013, Edward Snowden, a systems administrator, leaked numerous classified NSA documents revealing global surveillance operations. In 2010, Julian Assange’s WikiLeaks revealed numerous U.S. State Department diplomatic cables that also indicated the U.S. was participating in more discrete surveillance operations than previously thought.

Thiel, however, doesn’t believe that there necessarily needs to be a trade-off between security and privacy. “The goal for Palantir is to have more security with fewer privacy invasions,” he says. “If you have intelligent ways of looking at data, then you don’t have to be intrusive.”

The NSA, says Thiel, is an example of what happens when you don’t look at data intelligently.  The NSA is hoovering up data in every form today instead of figuring out what it need specifically, he says.

“One gets the sense that this is happening-- not because the N.S.A.'s really big brother, but because it's more like the Keystone cops,” says Thiel. “You're just collecting everything.  You don't really know what matters.  And so you end up listening in on [German Chancellor] Angela Merkel's cell phone. You end up collecting data on everything you can imagine.  And then you don't even notice if someone in your IT department is downloading all these files,” he explains, referring to Edward Snowden.

But, while protecting personal privacy is important, says Thiel, it’s equally important that the government makes sure we live in a more secure world, and implements technologies to prevent terrorism. Otherwise, he warns, “the next time there is a terrorist attack there will be far more restrictions [on privacy].”

It’s a difficult balance to strike because if another attack does occur, “it will again be an excuse for really eroding our civil liberties,” he says, citing 2001’s Patriot Act which was enacted following the September 11th terrorist attacks. Critics believe the Patriot Act goes too far, eroding personal privacy in the name of national security.

Cyber Warfare

Security, of course, doesn’t just pertain to terrorism—there is also cyber warfare. Recent hacks of large retail companies like Home Depot (HD) and Target (TGT) have left millions of Americans at risk for credit fraud. The Home Depot hack was the largest to occur in the retail world, affecting some 56 million customers’ credit information. In March 2014, some 40 million credit card numbers were stolen from Target’s database. Banks like JP Morgan Chase (JPM) and Bank of America (BAC) have also been hacked.

And it’s not just companies at risk from hacking and cyber attacks. This month, a U.S. Senate panel concluded that the Chinese government had infiltrated the computer systems of U.S. military contractors, airlines and technology companies.

Palantir has worked with client-facing companies and the U.S. government to prevent this kind of fraud.

“We [The United States] are fairly vulnerable on a lot of the cyber security issues,” says Thiel.  It’s a difficult task to negotiate because he thinks this is an issue that people underestimate. They don’t want access to websites to be cumbersome, and so they’re willing to make them less secure, he says.

There is, however, a bright side. 20 years ago, Thiel points out, it was unheard of to use credit cards online at all. And though it’s an “arms race between the bad guys learning new tricks and the companies stopping them,” on the whole he expects the Internet to become safer with time.

Peter Thiel's new book, Zero to One is out this month