The bedrock of Keynesian economics is that depressions and recessions can be avoided by the government printing and spending a bunch of paper. We can all live in a quasi-economic boom forever by the blessed gift of government intervention.

The key mistake made here as we have discussed in this blog before is hubris. Keynesians believe they have finally found the cure to economic downturns in government power. A “new economy” they spoke of before the dot com bubble burst. The “your house will never lose value” mantra of 2002-2006.  They always think they found the key to everyone being rich forever…until all the paper wealth evaporates and the fed has to find another sector to stick it in and tell everyone to go look over there and invest.

Imagine if sleeping were considered “recession”. Then a Keynesian would suggest downing caffeine pills at 3 am and celebrate the fact that you are still awake, though drooling, zombified, and shaking. But you’ve been “stimulated” and the recession of sleep has been countered!

Until of course you run out of caffeine pills and you collapse at high noon in your factory on the assembly line and get tenderized into a car part. That’s when the bubble bursts. So they suggest more caffeine pills and slap themselves on the back with a good raise in printed money salary.

But this post was about military interventionism. Just like economic interventionism, the military kind is based on spending insane amounts of paper money and assuming, with much hubris, that the government can keep the entire world balanced by handing out varying amounts of paper to different dictators and sending in the army all the way to Borneo as needed.

Just as government spending keeps economies in a quasi state of caffeinated zombishness, government spending on the military also keeps the entire world in a piss-offish caffeinated ready-to-strangle-each-other grip until the caffeine runs out and somebody starts WWIII.

Take my country, Israel. American government intervention here has brought us the Oslo Peace Process, which has kept both sides at each other’s throats for 17 years. Or more than that. If we weren’t pressured in ’67 to stop the war, there would be no conflict now. And every time there’s a flare up it just gets worse and everyone intervenes so nobody can win.

How about you just let us go at it until somebody wins and decides what to do with the loser?

There’s some Austrian Economic Foreign Policy for ya.

Ron Paul 2012.