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But how does wanting and craving lead to physical suffering?

A lifetime wanting and craving for this and that and especially the craving to continue to exist creates a powerful energy that causes the individual to be reborn. When we are reborn, we have a body and, as we said before, the body is susceptible to injury and disease; it can be exhausted by work; it ages and eventually dies. Thus, craving leads to physical suffering because it causes us to be reborn.