After the Rebellion, the pigs reveal to the other animals that they have been preparing for this day by learning to read. They have done this by studying a children's book that was thrown in the trash.
Snowball, who is the best reader and writer, because he is the most intelligent pig, organizes classes to teach the other animals to read. While Snowball organizes many committees that are not successful, the reading classes are a great success. By the fall, we are told, all of the animals are literate to some degree.
However, there are various levels of reading that emerge, based on the intelligence of the breed of animal in question. The pigs are the best readers. Muriel, the goat, and Benjamin, the donkey, learn to read fairly well, as do the dogs, but the dogs have no interest in reading anything but the Seven Commandments.
Clover learns the entire alphabet, yet Boxer can only learn a few letters. Other animals cannot get past the letter A. Therefore, it is ironic to say that all of the animals have a "degree" of literacy, for most of them are functionally illiterate to a high degree. Snowball, to get around the literacy problems, has to boil down the Seven Commandments to a simpler formula.
This difference in reading capacity foreshadows the fate of the less intelligent animals.