By "war is peace," Goldstein means that endless, limited wars at the peripheries of the three superpowers keep the world a stable place for those in charge. According to Goldstein, these constant, limited, unneeded small wars ensure peace and power for the ruling elite.
First, they unify the people in hate against a common enemy. Rather than using their aggressions and energy to overthrow the totalitarian regime oppressing them, the masses project these emotions outward toward a common foe.
Second, wars eat up resources that might raise the standard of living for the average person. This increasing living standard would be unfortunate from the ruling class standpoint, because having more resources would allow people more time and education. Then they would have time to think and might decide that they want a better life, which would threaten the power of the inner...
(The entire section contains 2 answers and 448 words.)