"All animals are equal, but some animals are more equal than others"

In class we say that the whole society is a single body as an effect of terror in totalitarianism. I don't quite understand how this works. If the whole society is a single body, then where does this terror come from? Does the terror come from others or from oneself? If the society is a single body, does it necessarily imply that others and self are the same? If everyone knows that he/she is a potential victim of others, wouldn't he/she try to avoid accusing others?

"All animals are equal, but some animals are more equal than others" This is a quote from Animal Farm by George Orwell. Is there a superior secret power that is "more equal than others" to exert this terror among men?