Naval thinks schools kill the one thing that creates economic value: natural curiosity. “Schools and our educational system replaces curiosity with compliance. Credentials reward conformity”. Once you replace authentic desire with compliance, you get an obedient factory worker but no longer get a creative thinker. This is evolutionary maladaptation - optimizing for industrial-age skills in an information age.
His childhood bypassed the system entirely. “I was raised by a single mom in New York, and she used the local library as a daycare center… So I used to basically live in the library, and I read everything”. The library became his education. No curriculum. No tests. Just pure intellectual leverage driven by interest. This created compounding knowledge because he followed genuine curiosity.
Schools exist for the wrong reasons now. “Schools come from a time period when books were rare. Knowledge was rare… Now we have the Internet, which is the greatest weapon of knowledge ever created”. The old infrastructure is obsolete. The abundance of information means the scarcity-based model of education no longer works.
“The most interesting things cannot be taught. But everything can be learned”
This is Naval’s core insight about intellectual ownership. Credentials focus on what can be taught in classrooms. But specific knowledge can’t be taught. “If they can be taught like in a school, then eventually you’re gonna be competing with someone who’s got more recent knowledge, who’s been taught, and is coming in to replace you. Credentials become commoditized”. This explains why formal credentials lose economic leverage over time.
Real learning happens through rapid iteration. “To the extent that specific knowledge is taught, it’s on the job. It’s through apprenticeships”. The best careers are “apprenticeship or self-taught careers, because those are things society still has not figured out how to train and automate yet.” This creates personal monopolies that can’t be replicated.
Business schools are negative-sum games. “A lot of what goes on in business schools… some of the things taught in business school are just anecdotes. They call them ‘case studies.’ Credentials over experience”. You learn more running a lemonade stand than reading textbooks. “Running a lemonade stand will teach you better accounting than a textbook”. The lemonade stand teaches real accountability - you win or lose money based on decisions.
Naval would rebuild education around first principles. “If I’m running a grade school curriculum for children, ignoring credentials, I would probably optimize happiness, nutrition, diet, exercise”. Teach mental models, relationships, inner peace, basic business, public speaking, persuasion. “I’d probably eliminate chunks of geography, history, and honestly even second or third languages”. Focus on skills with infinite leverage, not information.
He studied economics and computer science but learned what creates lasting value. “Microeconomics was incredibly useful. Macroeconomics was mostly useless”. The foundational theory lasted. The specific programming languages faded. “I would have focused on theory and principles over facts. Facts fade or facts can be looked up. Credentials focus on the wrong things”. Timeless fundamentals compound; temporary facts decay.
Traditional education creates reputational fraud: the overeducated person. “You’re going to be like that person that went to university: overeducated, but they’re lost. They try to apply things in the wrong places”. Nassim Taleb calls these “intellectual yet idiots”. They know facts but lack practical judgment. They have credentials but no capability.
The problem is learning without skin in the game. “Life is lived in the arena. You only learn by doing”. If you’re not doing, “all the learning you’re picking up is too general and too abstract.” You don’t know what applies where and when. Real feedback loops only exist when consequences matter.
Naval’s approach to raising his son reveals his deeper insight: “I don’t want to send him to school”. He wants to preserve natural curiosity because it’s the source of all future leverage. Schools teach compliance. The library taught him freedom. The difference determines whether you become sovereign or replaceable.