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Heat the oil in a large saute pan over medium heat.
Add the diced onion and tomato to the pan and cook, stirring occasionally, until softened, about 8 minutes.
Add the ground beef to the pan and cook, while breaking up the beef, until lightly browned, about 6 minutes.
Stir in the mustard, paprika, 1 tsp salt, ½ tsp black pepper, and 2 cups of the water and bring to a boil.
Reduce the heat to medium-low and simmer, stirring occasionally, for about 30 minutes.
In a small bowl mix together the cornstarch and 1 TBSP water until the cornstarch has dissolved.
Stir the cornstarch mixture in with the beef sauce until well combined.
Continue to simmer the sauce over medium-low heat, stirring often, until thickened, about 10 more minutes.
Season the sauce with salt & pepper to taste then serve over spaetzle or noodles.