The Narrator assists Tyler during his work as a waiter in a hotel. Tyler urinates in a dish of soup, and he targets the dishes that’ll be served to particularly rich, powerful people.
The passage is very unclear about whether or not the Narrator is also a waiter at the hotel (more foreshadowing of the Narrator’s connection to Tyler). Tyler is presented as someone both “wise” and childish, both aggressively confident and condescendingly cruel.
At another point, the Narrator recalls, Tyler worked as a waiter at a fancy dinner party; afterwards, he left a note saying, “I have passed an amount of urine into at least one of your many elegant fragrances.” Tyler admitted to his coworkers that he wrote the note, but didn’t actually urinate—he just wanted to punish the wealthy owners of the house for spending so much money on so many useless things. After the dinner party, the hostess, Nina, accused her husband, whom she addresses as Walter, of urinating in the perfume and then smashed all the bottles to the floor, cutting herself.
Tyler uses “psychological warfare” to attack spoiled, rich people. Such people, Tyler claims, are out of touch with life: they’ve distanced themselves from reality (i.e., the same reality of pain, sacrifice, and death that Tyler has tried to pass on to the Narrator). Also notice that the host’s name is Walter, the same name as the Narrator’s coworker. It’s not clear if these are two different Walters, or the same person (Palahniuk might be suggesting that “Walter” is a stereotypical name for an ordinary, unassertive man—as in James Thurber’s short story, “The Secret Life of Walter Mitty”).
The scene returns to the hotel, where Tyler is urinating in soup. Tyler and the Narrator serve the soup to a convention of dermatologists. One of the doctors, very drunk, is talking about how hepatitis viruses can survive for half a year. The Narrator asks the doctor where he can find some hepatitis “bugs,” (i.e., viruses) and the doctor replies, “everything goes to the medical waste dump.”
Tyler seems to be using his position to get information on how to gain tools to sabotage society: later on in the novel, “hepatitis bugs”—viruses that spread a serious disease—will be mentioned again.