Houyhnhnms are a breed of moral animal, different from the Yahoos or Europeans. We have, in fact, already seen this difference in Chapters 3 through 6. Houyhnhnm society is a rational (and, metaphorically, a bloodless) utopia. It contains details taken from Plato, as well as from More; both men proposed such societies as methods of curing people's vices. Swift demonstrates, however, that these utopias are only suitable to fully rational and totally innocent creatures; they are only inhabitable by the type of creature who doesn't need the cure.
The rest of Book IV is spent exploring Gulliver's pride — the extraordinary and perverted pride that makes him aspire to be a horse.
