Front Page Titles (by Subject) 1.: War and the Market Economy - Interventionism: An Economic Analysis
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1.: War and the Market Economy - Ludwig von Mises, Interventionism: An Economic Analysis 
Interventionism: An Economic Analysis, Edited with a Foreword by Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011).
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Interventionism was written by Ludwig von Mises in 1940 and is here translated from the original German by Thomas Francis McManus and Heinrich Bund. Editorial additions and index © 1998, 2011 by Liberty Fund, Inc. Interventionism was originally published in 1998 by Foundation for Economic Education, Inc.
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War and the Market Economy
Democracy is the corollary of the market economy in domestic affairs; peace is its corollary in foreign policy. The market economy means peaceful cooperation and peaceful exchange of goods and services. It cannot persist when wholesale killing is the order of the day.
The incompatibility of war with the market economy and civilization has not been fully recognized because the progressing development of the market economy has altered the original character of war itself. It has gradually turned the total war of ancient times into the soldiers’ war of modern times.
Total war is a horde on the move to fight and to loot. The whole tribe, the whole people moves; no one—not even a woman or a child—remains at home unless he has to fulfill duties there essential for the war. The mobilization is total and the people are always ready to go to war. Everyone is a warrior or serves the warriors. Army and nation, army and state, are identical. No difference is made between combatants and noncombatants. The war aim is to annihilate the entire enemy nation. Total war is not terminated by a peace treaty but by a total victory and a total defeat. The defeated—men, women, children—are exterminated; it means clemency if they are merely reduced to slavery. Only the victorious nation survives.
In the soldiers’ war, on the other hand, the army does the fighting while the citizens who are not in the armed services pursue their normal lives. The citizens pay the costs of warfare; they pay for the maintenance and equipment of the army, but otherwise they remain outside of the war events themselves. It may happen that the war actions raze their houses, devastate their land, and destroy their other property; but this, too, is part of the war costs which they have to bear. It may also happen that they are looted and incidentally killed by the warriors—even by those of their “own” army. But these are events which are not inherent in warfare as such; they hinder rather than help the operations of the army leaders and are not tolerated if those in command have full control over their troops. The warring state which has formed, equipped, and maintained the army considers looting by the soldiers an offense; they were hired to fight, not to loot on their own. The state wants to keep civil life as usual because it wants to preserve the taxpaying ability of its citizens; conquered territories are regarded as its own domain. The system of the market economy is to be maintained during the war to serve the requirements of warfare.
The evolution which led from the total war to the soldiers’ war should have completely eliminated wars. It was an evolution whose final aim could only be eternal peace between the civilized nations. The liberals of the nineteenth century were fully aware of this fact. They considered war a remnant of a dark age which was doomed, just as were institutions of days gone by—slavery, tyranny, intolerance, superstition. They firmly believed that the future would be blessed by eternal peace.
Things have taken a different course. The development which was to bring the pacification of the world has gone into reverse. This complete reversal cannot be understood as an isolated fact. We witness today the rise of an ideology which consciously negates everything that has come to be considered as culture. The “bourgeois” values are to be revalued. The institutions of the “bourgeoisie” are to be replaced by those of the proletariat. And, in like vein, the “bourgeois” ideal of eternal peace is to be displaced by the glorification of force. The French political thinker Georges Sorel, apostle of trade unions and violence, was the godfather of both Bolshevism and Fascism.
It makes little difference that the nationalists want war between nations and that the Marxists want war between classes, i.e., civil war. What is decisive is the fact that both preach the war of annihilation, total war. It is also important if the various anti-democratic groups work in cooperation, as at present, or if they happen to be fighting each other. In either event, they are virtually always allied when it comes to attacking Western civilization.