Peter Thiel 4 - What does it mean being a rich lawyer?

In 1830, Russia had the highest GDP in Europe, followed by France, UK, Germany, Austria-Hungary. At the middle we have Italy Spain and Portugal   At the bottom of the list we have Finland, Denmark. Switzerland was poorest country in Western Europe.

How things change. And if they changed before why not now?

Thomas Piketty and Balzac

Thomas Piketty's Capital book brings testimonials from novel's, like Balzac in France and Jane Austen in England, The book resorts to 1830 novelists to see their judgement about being rich.

This is what Pere Goriot, a spaghetti maker who is very well off and a simple man tells Eugene de Rastignac a penniless nobleman, about becoming rich by studying  law;

By the age of 30, you will be a judge making 1,200 francs a year. When you reach 40, you marry a miller's daughter with an income of 6,000 livres...  Maybe, if you are willing to do a little political dirty work, you may be a prosecutor general by the age of forty. However there only 20 prosecutor general in France, while 20,000 of you aspire to this position.

Maybe you want to be lawyer? ... Name five lawyers in Paris who make more than 50,000 francs per year by the age of fifty?

Balzac in real life worked at a lawyer office, There no way to make a living and escalate social layers simply by studying a profession; the law degree is only useful if one marries into the inherited wealth.

The tone of the story shows the importance of a constant income. The notion "net worth" is hidden. In 1819 the concept of present value, future value and loan calculators were not yet used. Financial math really started after 1900

An 1812 Treasure note.  On many issues the interest rate was chosen to make interest
calculations particularly easy, paying either 1, 1½, or 2 cents per day on a $100 note.

Peter Theil  about lawyer's prospects in 21st century US

And after a conventionally successful undergraduate career, I enrolled at Stanford Law School, where I competed even harder for the standard badges of success.

"I enrolled" is a modest statement.  Acceptance rate at Stanford Law was  10% in 2013 (versus Harvard 15.6%)

The highest prize in a law student’s world is unambiguous: out of tens of thousands of graduates each year, only a few dozen get a Supreme Court clerkship. After clerking on a federal appeals court for a year, I was invited to interview for clerkships with Justices Kennedy and Scalia. My meetings with the Justices went well. I was so close to winning this last competition. If only I got the clerkship, I thought, I would be set for life. But I didn’t. At the time, I was devastated.

That  would have had meant the final failure for Rastignac attempt to be a prosecutor general by the age of forty. Fortunately US has other options. After Pay Pal success a friend asks Peter:

“So, Peter, aren’t you glad you didn’t get that clerkship?” With the benefit of hindsight, we both knew that winning that ultimate competition would have changed my life for the worse. Had I actually clerked on the Supreme Court, I probably would have spent my entire career taking depositions or drafting other people’s business deals instead of creating anything new. It’s hard to say how much would be different, but the opportunity costs were enormous. 

In a recent New Times interview  Peter Thiel says it more clearly

We’ve built a country in which people are tracked, from kindergarten to graduate school, and everyone who is “successful” acts the same way. That is overrated. It distorts things and hurts growth.

This is the cathartic moment  when Peter Thiel realized that he is not part of the pack

Between the ages of 18 and 28 I came to believe less and less in the tracked things I’d been doing all my life. The cathartic moment was when I got to the law firm. From the outside, everyone was trying to get in. From the inside, everyone was trying to get out. Emotionally I wanted to work with friends and compete externally. At the law firm you competed with the guy next to you to get ahead.

In the start-up there was a sense of being unique, doing something no one had ever done. If you didn’t do it, it never would be done. It should be generally understood – every moment is unique, you are a unique person.

There was no one in the entire Europe who thought like this in 1830 . And even in California, we needed Peter Thiel's book  to make us see.

At the end of the interview with New York Times we have this correction:

Correction: September 15, 2014 An earlier version of a photo caption associated with this blog post misspelled the surname of the PayPal co-founder. He is Peter Thiel, not Theil.

I am sure this will be  the last time that NYT will misspell Peter's name