Are Freedom and Democracy Incompatible? Peter Thiel thinks so

Peter Thiel is the creator of PayPal, also the first major investor in Facebook and he sits on the Facebook board.

Peter Thiel
Wikipedia

Peter Thiel wrote, on April 13, 2009, in the Libertarian 'Cato Unbound' blog, “Most importantly, I no longer believe that freedom and democracy are compatible.” In the same article, he also wrote, "Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of “capitalist democracy” into an oxymoron. (emphasis mine) Wikipedia

How does Thiel define "freedom"?

"I remain committed to the faith of my teenage years: to authentic human freedom as a precondition for the highest good. I stand against confiscatory taxes, totalitarian collectives”   Peter Thiel - The Education of a Libertarian

Thiel thinks his freedom is incompatible with democracy. How is democracy normally defined?

democracy ‎(plural democracies)

1. (uncountable) Rule by the people, especially as a form of government; either directly or through elected representatives (representative democracy).  
2. (countable, government) A government under the direct or representative rule of the people of its jurisdiction.  
3. (uncountable) Belief in political freedom and equality; the "spirit of democracy".

"Democracy" then, means the rule of the "demos". Who are the "demos"?

demos ‎(plural demoi)

1. (political science) The common populace of a state, the people. Wiktiionary

Where and how is Democracy incompatible with Peter Thiel's freedom?

It's all quite simple, let Bernie Sanders explain:

This is an economic model developed by the economic elite to benefit the economic elite. We need real change.(...) We need to end the international scandal in which large corporations and the wealthy avoid paying trillions of dollars in taxes to their national governments. Bernie Sanders - New York Times

Where is Thiel-style freedom leading?

McAfee, associate director of the MIT Center for Digital Business at the Sloan School of Management, (...)despite his obvious enthusiasm for the technologies,  doesn’t see the recently vanished jobs coming back. The pressure on employment and the resulting inequality will only get worse, he suggests, as digital technologies—fueled with “enough computing power, data, and geeks”—continue their exponential advances over the next several decades. “I would like to be wrong,” he says, “but when all these science-fiction technologies are deployed, what will we need all the people for?” (emphasis mine) MIT Technology Review Magazine

Obviously. from Peter Thiel's personal point of view, democracy and his freedom are incompatible.

In Thiel's defense we should be grateful for his forthrightness, because Peter Thiel is rather innocent in his sincerity. The crafty Koch Brothers, for example, would never come right out and express themselves so frankly, but everything they actually do expresses the same view of democracy as Thiel's.

And they are not just sitting on their hands, they are up and doing something about it.

The House approved a bill Tuesday that would bar the IRS from collecting the names of donors to tax-exempt groups, prompting warnings from campaign-finance watchdogs that it could lead to foreign interests illegally infiltrating American elections. USA Today  

USA Today’s Fredreka Schouten reported that the bill is openly supported by Charles Koch, the older of the two “Koch Brothers,” fossil fuel billionaires whose deep pockets hold a notoriously outsized influence on American politics. Kit O'Connell - Mint Press

This is nothing new. The democratic state, (government of the people, by the people, for the people) has always been the only possible defense of "the People" facing the powerful, who wish to dominate and exploit them.

Again, knowing who the Thiels and the Kochs of this world are, who are "the People"?

The mass of a community as distinguished from a special class (elite); the commonalty; the populace; the vulgar; the common crowd; the citizens. Wiktionary

How long has this struggle between the "Thiels and Kochs" and "the People" been going on?

Aesop: A Lion used to prowl about a field in which Four Oxen used to dwell. Many a time he tried to attack them; but whenever he came near they turned their tails to one another, so that whichever way he approached them he was met by the horns of one of them. At last, however, they fell a-quarreling among themselves, and each went off to pasture alone in a separate corner of the field. Then the Lion attacked them one by one and soon made an end of all four. Moral: United we stand, divided we fall.

This struggle is nothing new and it has no end. DS

Is democratic capitalism in danger?

“In the quest for growth, many countries have neglected to build a reliable system of social security that will help citizens buffer the market's volatility.(...) Democratic capitalism’s greatest problem is not that it will destroy itself economically, as Marx would have it — but that it may lose its political support.” Raghuram Rajan 

David Seaton's News Links

Professor Rajan's idea that capitalism might lose its "democratic support" unless it protected its citizens with a reliable social net just wont leave me alone, I keep coming back to it over and over again... especially when the entire system's trend at this moment seems to be going in exactly the opposite direction: leaning toward reducing not enlarging "entitlements" and the worse things get, the more cuts are being put on the table and the more entitlements are being taken off.

What exactly would "democratic capitalism, may lose its political support” mean?

I take it to mean that under extreme pressure, a large number of citizens would be giving a serious look to other economic systems, specifically "democratic socialism", and they might be tempted to organize democratically to achieve that.

If that were the case: what tools would the corporate system need to protect its version of capitalism from democracy?

If you take that that question to form a paradigm, many disparate things in our political system begin to cluster together in interesting patterns.

Look at the following snippets for a sample of what I mean:

The Supreme Court on Monday blocked a massive sex discrimination lawsuit against Wal-Mart on behalf of female employees in a decision that makes it harder to mount large-scale bias claims against the nation's biggest companies. AP

 And of course we already had this:

Overruling two important precedents about the First Amendment rights of corporations, a bitterly divided Supreme Court on Thursday ruled that the government may not ban political spending by corporations in candidate elections.(...) The ruling represented a sharp doctrinal shift, and it will have major political and practical consequences. Specialists in campaign finance law said they expected the decision to reshape the way elections were conducted. NYT - January 21, 2010

 You might say we are looking at a concerted plan of action:

The Supreme Court, which winds up its term Monday, has once again shown itself to be highly skeptical of large lawsuits against big business, regardless of whether the suits are intended to protect workers, consumers or the environment. This year, a 5-4 conservative majority gave companies a stronger shield against class-action claims from consumers who said they were cheated and from employees who said they were victims of discrimination. The same five justices also blocked lawsuits against the makers of generic drugs for failing to warn patients of new dangers. And in a unanimous decision, the high court killed a broad lawsuit that sought to force the major power producers to limit the carbon pollution linked to global warming. LAT

 Now stir this into the mix:

The Obama administration has long been bumbling along in the footsteps of its predecessor when it comes to sacrificing Americans’ basic rights and liberties under the false flag of fighting terrorism. Now the Obama team seems ready to lurch even farther down that dismal road than George W. Bush did. Instead of tightening the relaxed rules for F.B.I. investigations — not just of terrorism suspects but of pretty much anyone — that were put in place in the Bush years, President Obama’s Justice Department is getting ready to push the proper bounds of privacy even further. Editorial - New York Times

Reading the above as if were one text, it would seem to me that the great and the good are expecting things to not only stay rough for a long time, but to get a lot rougher and the war on terrorism, like the war on drugs, and all the other endless wars that America finds itself engaged in have been a vary practical workbench for developing some extremely useful tools, if and when "democratic capitalism" ever lost its "political support". DS