Secret History #1: How Power Works

I first want to talk about Immanuel Kant. We will be discussing him a lot because he is the greatest philosopher in Western history. He taught us how the world works, and this is what he told us: we can never know objective reality.

There is an objective reality, what he calls the noumena, or the "things in themselves," that is not knowable to us. That is a world we can never access. Why? Because we perceive the world through our senses. Our senses, our perception, warps the world and changes it into a structure that we can process, called the phenomena—the things that appear to us.

The classic example is time and space. Time and space do not exist outside of us. Time and space do not exist in reality. But for us to understand reality, we need to add in time and space. How the world works is we perceive the noumena and turn it into the phenomena for us to process.

In other words—and this is really important—reality is what we imagine it to be. There is no objective reality. Life is a constant process, a constant act of imagination.

The Project: Uncovering the Secret History of the World

We will be looking at the past, the present, and the future. We will be analyzing all three in order to construct a more objective reality for ourselves. We will not succeed. We will fail. But the process of trying will train our minds to think much more critically about the world.

Here is how we will do it. In the present, we have geopolitics. We'll be studying geopolitics. For example, why is there war in Ukraine? Why is there war in the Middle East? We will try to formulate an analytical model of geopolitics.

We will then use this analytical model to make predictions about the future. Why do we do this? Because these predictions will tell us if our analytical model is correct or not. It's no different from artificial intelligence. How do you know if your AI model is correct? You test it against reality.

If we are able to have an analytical model that makes correct predictions, then we take all this and go back to analyze the past to reveal the secret history of the world. That is the project we are undertaking: to discover for ourselves the secret history of humanity.

You may not know this, but all the history that you learn in school, the history that you think you know, is false. The history that you believe is a system implanted into your brains by powerful people. The real question that we're looking at is really: How does power work?

If we can figure this out, then you will achieve liberation. You will achieve freedom. You will understand how you're being manipulated by others, and therefore, you'll be free. You'll be empowered to live the way you want to live, to see the world that is true to you.

Let me give you three core examples of how power works.

Example 1: The Illusion of Money

Let us do a thought experiment. I'm a bank. I decide I want to open a bank, and you are allowed to put money in it. All of you get together and you put $5 million in my bank. Why? Because I promise you 1% interest. That's a really good deal.

But now, because I owe you 1% interest, I need to go make money for myself. I have a friend who's building a restaurant, and he says, "I need $5 million to build the restaurant, and after a year I will pay you back 10% interest." I make a 9% profit, and I can use that to pay my employees, pay myself a salary, and build a new building.

Now I want you to think about this. I'm the bank. I got $5 million in deposit money, then I gave out a $5 million loan. Today, how much money is in the bank?

Logically, the answer should be zero. In fact, zero is the answer that you are taught in economics. A student correctly points out the fractional reserve system, where a bank must leave behind a certain amount of money, say 10%. So, theoretically, I can't lend out the full $5 million; I can only lend out $4.5 million. In that case, how much money do I have in the bank? Half a million. Again, this is what you're taught in economics. This is what makes logical sense.

The correct answer—what actually happens in real life—is you now have $9.5 million.

This makes no sense, right? But it happens in reality. How do we know? Because over the past 20 years, Chinese banks like the Bank of China, the Bank of Industry and Commerce, and the Agricultural Bank of China have become the largest in the world. How did that happen? Was it because Chinese people got rich and put all their money in the bank? No. What happened was these banks started to lend money out to corporations, to government, to people to build skyscrapers and roads.

In other words, the banks started to create money out of nothing in order to finance China's infrastructure projects. That's what banks are allowed to do. They're allowed to print money, create money out of nothing.

The Origin of Modern Banking

How did this system come into being? In the beginning, it was merchants who engaged in finance because they needed money to facilitate trade. Some merchants became extremely wealthy and started banks to support other merchants. These banks traded in gold.

You would come and put your gold in the bank for safekeeping, and the bank would give you a contract, a receipt, promising to give back your gold at any time. This allowed for easier trade. I could take this contract from Italy to England to buy cotton. I give you the receipt instead of the gold because it's much easier. This system facilitated trade throughout the world.

Now, I'm the bank. I have all this gold, and I want to make money with it. Other merchants come to me and say, "Listen, I need gold. Can you lend me some?" I say to them, "If I give you the gold, you have a security issue. It's inconvenient. Why don't I give you a receipt, a contract, instead?" All they need is a receipt to do trade elsewhere.

By doing this, I've doubled the gold in my bank. The physical gold is still $5 million, but the receipts are now $5 million plus another $5 million. Theoretically, I now have $10 million in the bank. I've created money out of nothing.

The Inherent Problems: Bank Runs and Royal Defaults

There's a problem with this system. I have $5 million of gold, but there are $10 million of gold receipts out there. What's the problem? If everyone wants their gold back at the same time, I go bankrupt. This is what we call a bank run.

There's another problem. Who do I usually lend my money to? Back then, it wasn't entrepreneurs; it was kings and noble people. And why do they need money? To fight wars. The problem with this is the king could get killed, or, much more commonly, the king could say, "Screw you, bank, I don't need to pay you back."

Over time, a system developed to mitigate this risk: cartels. Banks would create partnerships, often through intermarriage, with other banks throughout Europe. If a bank faced a run and needed more gold, it could get it from another bank in the cartel. And if a king decided not to pay you back? Your bank works with other banks to establish a new enemy to kill that king and get the money back.

This system is what we call today central banking. And what you will learn is that central banking controls the world today. This system is based on power, and power can turn nothing—the contract—into everything.

The Lie of Scarcity

We live in a world in which banks can print money. So let's ask ourselves a question: if banks can print as much money as possible, why do we have poverty? We could just give money to poor people, and they wouldn't be poor anymore. Why are people starving if there's all the food in the world that we want?

The common answer is scarcity. We have poverty because of scarcity. But I already told you: they can print money out of nothing. Money is an infinite resource. So why do we have poor people?

You all believe money is scarce. But I just spent the past 10 minutes explaining to you it's not. It's infinite. It's just a number. We can, at any time, print as much money as we need. This is how power works. Power has brainwashed you into thinking something that is not true.

So, why is there poverty? Why is there inequality? The answer is that the powerful people don't want everyone to have money. Why? Because otherwise, no one would work. The point of printing money is not to give you money. The point is to create the illusion that money is valuable, and therefore you work hard to obtain it. But in order for me to make you want money, I need to create artificial misery.

If there weren't poor people, you wouldn't want to be rich. It's only because you see people suffer that you want to go make money for yourself.

Your parents tell you, "Work hard in school, make a lot of money. Otherwise, you're going to end up like a poor person." Well, if there are no poor people, your parents couldn't say that to you, and you wouldn't want to work hard. That's why we have poverty: because poverty creates the illusion that money is valuable. Poverty isn't what you do to yourself; it is what the powerful do to you.

Why do we have economic crises, like a stock market crash? The point of a crisis is to destroy money. Why? Because if there's too much money in the system, people don't have to work. You have to destroy this money to make people feel that money is scarce.

Why do we have wars? You think they're fighting over scarce resources, but I already told you scarcity is a lie. The real reason is that war is meant to destroy wealth in order to make you think money is valuable.

This world we live in is a complete illusion created by central banking to make us work as hard as possible, because the real value is not money. The real value is the work we do.

But Aren't Resources Like Food and Land Scarce?

This is a great question. Isn't food scarce because it's a finite resource? Do yourself a favor: go to a garbage dump anywhere and see the amount of food that is wasted every single day. If food were scarce, why would we have food waste? If you do the mathematics, you will discover there's enough food to feed everyone. Hunger and starvation are an artificial crisis. You're right that food is not infinite, but it is abundant.

You are stuck in the scarcity mindset, and it's very convincing. I cannot convince you this morning that everything you believed about the world is wrong. But we live in a world of abundance, and a lot of things you believe are just misconceptions.

Example 2: The Illusion of Individual Happiness

What makes us happy? Money, power, freedom, relationships, love, video games, vacations. What you will discover about this list is that you are thinking about individual happiness. This is actually unique in human history. If you go back in time and ask people how to be happy, they would focus more on collective happiness. In other words, if your community were not happy, you could not be happy.

The very idea of the individual is new. Before, we understood that to live a happy life, you need to take care of your family and your community. Happiness meant helping others, being generous. For example, in the ancient past, if I went off and found a lot of gold, what's the first thing I would do when I came back? The modern mindset is to dig a hole and save it for our children. But what they did in every society was have a big feast for everyone. They spent all the money on a feast because what mattered was your reputation and generosity within the community.

This is ingrained in us. Even in China, for most of its history, if you came from a village, went to Beijing, opened a restaurant, and made a lot of money, the first thing you would do when you went back to your village is have a big feast for everyone. But today, we believe if you have money, you put it in the bank.

The concept of the individual as a person independent of family, community, and the world around them makes no sense historically. What was the worst punishment that could be inflicted on you in the past? Not death. It was banishment, exile. To be told, "You are no longer part of us."

Two Worldviews: Polytheism vs. Science

I'm going to present two understandings of the world.

1. The Polytheistic Worldview: We humans don't have agency or real control because there are powerful gods out there—Apollo, Dionysus. But they are also controlled by more powerful gods like Fate and Fortune. And then there are ancient gods that control the structure of the universe, like Anger and Pride. You have no individual agency because there's always a god screwing with you. You might get rich, but then the god of Pride looks at you and says, "I need to teach this mortal a lesson," comes into you, makes you too arrogant, and you screw up. We are always being controlled by forces beyond our understanding.
2. The Scientific Worldview: We are synapses that generate memories. Our understanding of the world comes from our experience, which is controlled by synapses that come from a combination of DNA and environment. This means we can have control over our own individual fate. If you're angry, it's because some experience or gene made you angry. This anger becomes reinforced in your memories. Therefore, if you do proper therapy, reflection, or exercises, you can better control your anger and control your fate.

Which worldview is a more accurate reflection of reality? Obviously the second one, right? This is neuroscience, psychology, psychiatry. This is what you've been taught. Our entire society is structured around this idea.

And what you will learn is that it is completely wrong. It is the first one that is a more accurate reflection of reality. The first one gives you more information, a more accurate assessment of how the world really works.

Why Power Prefers the Scientific Worldview

If polytheism was the dominant religion for most of human history, why did we transition to the religion of science? If you're a powerful person, why would you prefer the second worldview?

1. Individual Responsibility and Control: It's easier to control people in the second system. It promotes the idea of individual responsibility.
2. It Makes You Work Harder: In the first system, you might think, "I don't need to make a lot of money because the gods will just punish me for my pride. I'm just going to enjoy life." In the second system, you believe, "I have control over my own life, so I need to work hard." The entire point of the system is to make you work as hard as possible, because your hard work generates real wealth for the powerful.
3. It Makes You Powerless: This is the most important benefit. The second system is designed to make you absolutely powerless. Why? Because you are incapable of collective action. You think the source of all your problems is the individual—you—and not society. But in the first system, you are capable of collective action, and the only way to change the world is through collective action. The second system is designed to make you think the source of all your problems is within you, so you should ignore what other people do and think. Therefore, you're incapable of identifying with other people. If you feel miserable, you'll play video games or watch porn all day.

In the second system, who has authority? Scientists. You listen to scientists because this system was created by scientists to trick you. If you're ever feeling sad and depressed, what have you been taught to do? Go talk to a psychiatrist or a psychologist. And what will they do? Let me give you a piece of advice: if you're feeling sad and you talk to a psychiatrist, I will bet that the psychiatrist will make it a lot worse.

The system is not designed to cure you. It is designed to make you dependent on authority. You know that if you feel sad, you can just go for a walk or talk to a friend, and you'll feel better over time. But this system teaches you, "No, you feel sad, go talk to a psychiatrist who will give you drugs."

Eudaimonia vs. Pleasure

In the polytheistic system, the gods are really bad people. They fight all the time; they're vengeful, angry, and proud. The difference between humans and gods is that gods can get away with it. We are all the same—angry, jealous—but gods can commit hubris, and we cannot. The idea that people in power are benevolent authority figures acting in our best interest is a new, modern concept. Before, it was assumed the king is king because he's favored by the gods, not because he's a good person. The gods give, and the gods take.

This worldview leads to a concept called eudaimonia, or flourishing. If you have no control over your fate, if things can happen tomorrow that kill you, then you must live your life to the best of your ability today. Seize the day. Be the best that you can be. That's how you win favor from the gods. The point of life is to live it to the best of your ability. That's why the ancients, the Greeks, were superior to us.

Today, instead of eudaimonia, we have pleasure. Rather than flourishing as creative people, we ask, "How do I enjoy my life today? How do I not feel sad?" In the first system, even though it sounds like we have no control, it inspires us to live to the best of our ability. In the second system, where you're told you have complete control, it enslaves us.

Example 3: The Illusion of School

Why do we have school? To learn, to get a degree, to gain knowledge. The correct answer is brainwashing. Everything else is a lie.

In school, you come to class, listen to a lecture, read books, take a test, and write a paper. That's how you learn, right? But throughout most of human history, how did we learn? If you wanted to become a doctor, what did you do? You learned through experience.

Let's say you're 12 years old and want to be a doctor. There are two paths.

1. You are put in a hospital for 10 years as an apprentice to a mentor. The first year, maybe all you do is wash the floor, but you observe the doctor, who eventually teaches you how to treat patients.
2. You go to the best schools in the world: Harvard for undergraduate, then Harvard Medical School.

At age 30, who is the better doctor? Obviously, the first one, because the second person never worked in a hospital. In the first system, do you have to be really smart to be a good doctor? No. Anyone can be a doctor in the first system. We human beings are all born with the capacity to learn anything if we want to.

Instead, we have a system where we tell students, "You're smart," or "You're stupid." Smart students go to good schools and get good jobs. Stupid students go wash dishes. This was not true for most of human history.

School is not a place to teach you how to learn or gain knowledge. A school is a place that brainwashes you.

The Military Origins of Compulsory Schooling

To understand this, let's look at the three societies that first introduced mandatory, free, public schooling.

1. Sparta: A small city-state in Greece 3,000 years ago. Children as young as five or six were put into a school where they were beaten up by older kids.
2. The Aztecs: They also provided free, compulsory education to all children.
3. Prussia: The Prussian system is the one that everyone uses today.

What is common about all three societies? War. All three were fundamentally war societies dedicated to defeating their neighbors. Sparta was one of thousands of city-states in Greece, but the only one with compulsory education, because Sparta was first and foremost engaged in war-making. The Aztecs were the greatest war society in Central America. The Prussians had the greatest military in Europe for centuries.

Schools are really good at preparing people for war. Why?

The Goal of School: Brainwashing the Nation-State

What's the worst thing that can happen to a parent? Their child is taken away from them. What does school do? School is designed to take your child away from you. If school was about learning, why don't parents and children go to school together?

It's about brainwashing. How do you brainwash someone? If you're with your parent, you feel loved and secure. Your parent will protect you. You'll ask your parent, "Is this teacher lying to me?" and the parent might say, "Yes, they are." It's only because you've been taken away from your parent that you are willing to be brainwashed. When you leave your parents at four, five, or six years old, you feel insecure, anxious, and afraid. So who do you trust? Your teacher. Whatever your teacher says is now correct.

If schools are designed to brainwash you, what are they brainwashing you to believe in? A concept called the nation-state.

Schools are designed to make you think the nation-state exists. It is a person: Mother China, Mother Russia, Uncle Sam. You must love this person, sacrifice for this person, dedicate yourself to this person. How do we brainwash you? We teach you language, history, and geography to make you believe that the nation-state—China, the United States, France—exists.

But for most of human history, this was an absurd idea. Before, you didn't say, "I'm Chinese." You said, "I'm a Beijinger," or "I'm from Haidian." That makes more sense; you're from a place where you know the people. But now, because of the nation-state, you are forced to believe you are the same person as someone from Yunnan or Tibet, even though you have absolutely nothing in common.

School is designed to implant in you a false memory of a nation-state. That's what history is: the false memory of a nation-state. The point of school is to make you serve the nation-state. If you believe in Mother China, then you must serve her, obey her, fight for her, and die for her.

The Origin of Our Illusions: Monotheism

The three concepts we've discussed—money, the individual, and the nation—are all ideas beyond the human experience. You have to be brainwashed into believing them. If someone from a thousand years ago were to come today and you explained these concepts, they would say, "This means you're all slaves."

Where did we get these three concepts from? You will learn that they come from a revolution in human thought called monotheism: the one true God.

This idea of monotheism forever changed the course of human history. It gave us the concepts of money, the individual, and the nation-state. Monotheism is such a powerful idea that it turned nothing into everything.

The Alchemical Nature of Power

What power truly is, is what we call alchemy. Throughout human history, alchemy was the pursuit of turning lead into gold—nothing into everything. You're taught in science class that alchemy is a pseudoscience that did not work. What you will learn is that we achieved alchemy. We turn nothing into everything.

Power is the capacity to turn nothing into everything. Power is the capacity to make you believe that money is valuable, that the individual can lead to happiness, that the nation-state exists.

As a result, today we live extremely miserable lives. You've been taught to think that life just gets better and better. What you will learn is that this is not the case.

What's really important is that you will also learn that this was an accident. It's an accident of the human imagination. It's because we didn't know what we were doing that we created this system. You will also learn that you are able to control the human imagination. You can use it to create a new system that allows for eudaimonia, for the flourishing of the human intellect.