Those who could have helped each other through voluntary transactions had no cause to come together. They remained strangers and, in time, were even led to consider one another enemies. Government intervention, which begins by distinguishing between domestic and foreign goods and producers, leads in time to a policy of economic nationalism which actively discriminates in favor of domestic products to the disadvantage of imported goods. This hurts not only foreign producers, whose goods are excluded from the domestic market. It also harms domestic consumers and producers.
Production costs rise so that fewer goods can be produced and sold.
With fewer goods and services available for everyone, living standards decline. The sure way to turn local disputes into widespread conflicts is for outsiders to interfere. Officials of one nation offer to help defend a weaker country against the threats of stronger neighboring states. But by taking sides in this way, neutrality is abandoned. U.S. involvement in the Middle East undoubtedly began with a sincere sympathy for Jewish refugees who wanted to establish a homeland in Israel.