How does a VPN client work under the hood?

I am wondering how L2TP works internally to provide transparent IP connectivity. I understand that L2TP tunnels IP packets through UDP port 1721. However, I do not see how this provides transparent access. For example, let's say I have a VPN connection and my browser connects to google.com. Typically, this is a TCP connection with the google IP address on port 80. However, something should intercept this request and route it through the L2TP mechanism.

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In the Security Now podcast, they made 4 parts of the VPN series. The best part is that there are transcripts on the Internet, so you do not need to listen to all this if you know what to look for. here is a link to the main page http://www.grc.com/vpn/vpn.htm

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