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Randolph Bourne
In my essay "The Herd Mind," I explained how "War is the health of the State," according to Randolph Bourne: in particular, how war causes a country to regress from a diverse civilization to a uniform herd locked in fight-or-flight mode, and easily driven by the government.

As I mentioned in my talk "How the Fed Feeds War," this propensity is not lost on those in government, which explains why so many of them are so wont to start and expand wars. War is a pressure point on the body politic which the government strikes to disable resistance and obtain submission. By repeatedly striking that nerve, and thereby inducing war fever and triggering fight-or-flight, a government continually renews its subject population's sense of alarm and dependence, its pliability and support.

Thus it has ever been, for as I propounded in my essay, " War is the Birth of the State," government owes its very origin to this effect. As Herbert Spencer wrote:
"...Government is begotten of [martial] aggression. (...)

...at first recognized but temporarily during leadership in war, the authority of a chief is permanently established by continuity of war; and grows strong where successful war ends in subjection of neighbouring tribes."
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Herbert Spencer
This is the tribe transforming from a community of families into a ravaging horde and a stampeding herd under the direction of its chief as herdsman.

And the subjected "neighbouring tribes" are also brought into the fold. Interestingly, according to Franz Oppenheimer, the conquering people who become herders of beast-like men, in general, are previously herders of literal beasts. The primordial rise of the conquering State was largely the story of nomadic herdsmen first marauding, then extorting, and then finally ruling settled agricultural populations.

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Franz Oppenheimer
With these conquered peasants too, it was "foreign threats" that transformed them from proud, resisting men into docile herd animals. It was war and the threat of war that transmuted naked exploitation into "government." A settled plunderer will naturally fend off rival plunderers, just as a shepherd will ward off wolves: not for the sake of his flock per se, but for the sake of his wool and mutton. And so, as Oppenheimer wrote:
"The peasants become accustomed, when danger threatens, to call on the herdsmen, whom they no longer regard as robbers and murderers, but as protectors and saviors."
Thus, thanks to the panic of the spooked herd, "plunder" becomes "tribute" becomes "patriotic taxes for national defense" under that first of all protection rackets called the State.

In a sense, war sustains the State during "peacetime" as well. This is especially true for modern welfare democracies ("welfare" being defined so as to include corporate welfare). Earlier States, like the primordial ones discussed above, were characterized by what Frédéric Bastiat called "limited legal plunder," under which "The few plunder the many." Modern States, on the other hand, are characterized by what Bastiat called "universal legal plunder," under which "Everybody plunders everybody." As Bastiat explained:
"Men naturally rebel against the injustice of which they are victims. Thus, when plunder is organized by law for the profit of those who make the law, all the plundered classes try somehow to enter — by peaceful or revolutionary means — into the making of laws. According to their degree of enlightenment, these plundered classes may propose one of two entirely different purposes when they attempt to attain political power: Either they may wish to stop lawful plunder, or they may wish to share in it.

Woe to the nation when this latter purpose prevails among the mass victims of lawful plunder when they, in turn, seize the power to make laws! Until that happens, the few practice lawful plunder upon the many, a common practice where the right to participate in the making of law is limited to a few persons. But then, participation in the making of law becomes universal. And then, men seek to balance their conflicting interests by universal plunder. Instead of rooting out the injustices found in society, they make these injustices general. As soon as the plundered classes gain political power, they establish a system of reprisals against other classes. They do not abolish legal plunder. (This objective would demand more enlightenment than they possess.) Instead, they emulate their evil predecessors by participating in this legal plunder, even though it is against their own interests."
Bastiat concluded:
"The present-day delusion is an attempt to enrich everyone at the expense of everyone else; to make plunder universal under the pretense of organizing it."
And elsewhere, Bastiat wrote:
"Government is the great fiction through which everybody endeavors to live at the expense of everybody else."
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Frédéric Bastiat
Rather than "live and let live," which according to Bourne, is what individuals do in a true state of peace, most people in a welfare democracy (including especially crony capitalists), corrupted as they are by access to the State machinery of compulsion, are bent on subsisting extractively on each other. As Bastiat characterized it, the modern State is a plundering, Hobbesian "war of all against all" sublimated into a seemingly genteel, orderly process. The law of the jungle is instituted and regularized under the mantle of the rule of law.

Just as military foreign wars do, this "war by other means" against domestic enemies causes the people to regress toward herd-minded animality. In order to attain the strength in numbers necessary to achieve fleeting victories in this war, people flock together as "interest groups", or "herds within the herd," which the government mobilizes against each other in the reciprocal pursuit of legal plunder and coercion. Decency and goodwill toward those outside the sub-herd go by the board as people embrace what Ludwig von Mises called " warfare sociology": the belief that those within a herd cannot gain except at the expense of another herd.

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Ludwig von Mises
In Oppenheimer's terms, "the economic means" of acquiring wealth (production and exchange) give way to "the political means" (coercion and plunder). In Mises's terms, "social competition" gives way to "biological competition." People look upon those outside their herd, less as fellow human beings and potential partners in commerce and friendship, and more the way a lion looks at a zebra (something to feed on) or a jackal looks at a lion (something to snatch from).

By presenting them with easy access to the bestial means of aggrandizement, as well as the necessity to defend against those who use those means against them, the government makes people prone to fight-or-flight responses toward out-group others: like a predator transfixed with hunger at the sight of its prey, or like that prey transfixed with terror at the sight of a predator.

The herd mind manifests vividly, not only in war rallies, but in political rallies, where rival herds low and bray against each other. At these rallies, fevered minds are filled, not only with "foreign menaces," but various domestic ones: "welfare bums," "selfish businessmen," "the gay agenda," "bigoted shopkeepers," "droves of 'illegals,' "gentrification," "urban thugs," etc.

Through the government, each herd/horde plunders and persecutes by proxy, and is plundered and persecuted in turn. As the sole apparatus for legal plunder, the government takes a cut of the loot for itself for each theft it facilitates. And anger more properly directed at the government is diverted toward domestic enemy herds. In fact each herd becomes deeply wedded to the government as its chief implement for attacking and defending against its foes. And in order to achieve the unity necessary to realize its numerical strength, each herd rallies behind its "champions" in government and the political class.

Thus, this kind of sublimated war is also the "health of the State." The herd mind that reaches its apogee in times of international military conflict is continually activated even in "peacetime" by the modern government keeping its subject populace in a managed, chronic state of low-grade civil war.

This analysis fits well with Bourne's broadest definition of the State. At one point he defines it as follows:
"The State is the organization of the herd to act offensively or defensively against another herd similarly organized."
What is war but the mobilization ("organization") of multitudes ("herds") against each other in offense and defense? So Bourne's definition may be fairly rephrased as simply: "The State is war."

War is the birth, the health, the very essence of the State.