Spaghetti sauce

1 small onion, chopped
12 oz tomato paste
2 cloves garlic, minced
1 Tbsp salt
1/4 tsp thyme
2 bay leaves
1/4 tsp crushed red pepper
2 tsp basil
2 tsp sugar
1 tsp oregano
28 oz crushed tomatoes
1 quart water or red wine