Former Texas Congressman Ron Paul (R-TX) believes that the U.K.’s historic vote to pull out of the European Union will actually be marked as the beginning of the end for the union. “I think [the EU] will become nonfunctional,” the former Presidential candidate told CNBC. “It really is coming to an end. It doesn’t mean tomorrow or the next day, but people are going to be really unhappy. The end is coming, but it isn’t coming because of the breakup.” Paul argued that the breakup was actually due to terrible economic policy. The real problem was the liberal fiscal policy preferred by the socialist European leaders, “What has been preceding this situation that we have throughout the world and this country as well is artificially low interest rates that cause people to make mistakes in buying bonds and different things. So it’s the instability of the market that will respond when something like this comes out. But the concentration has been on, ‘What do we do now?’ because of the Brexit vote. But the catastrophe doesn’t come unless there’s something that precedes it, and what sets the stage is monetary policy, artificially low interest rates, zero interest rates. It makes no sense.”
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So there’s a lot of instability still out there, and this hasn’t been corrected yet. I don’t think it’s going to correct easily. I think you’re going to see a very weak market for a while to come…
The sentiment now is, especially for the British people, is they don’t want in there. And other countries will do the same too. I think if you’re really a champion of the European Union and you think that’s salvation — to have central economic planning with an European economic union as well as the European Central Bank. No, I think it’s ending. But I think this whole system of economic planning and central banking and our Federal Reserve system is under attack because we’re running out of steam. And if we go into a recession, which many people believe we will or already there, what does the Fed have left?
Ron Paul on if this is the “beginning of the end” for the EU:
It’s becoming non-functional. And I know right now they are talking about a militarized European Union.
I think in a functioning way, it really is coming to an end. That doesn’t mean tomorrow or the next day, but people are going to be really unhappy. But the end is coming, not because of the breakup. The breakup is a reflection of the bad policies that the world has been following.
We’ve never lived, in the history of the world, with pure fiat money for as long as we have. For 40-some years, since 1971, so it is a type of bubble of malinvestment and debt-ridden world that we have to deal with…
The real question is what are you going to do when it really falls apart? And currencies have fallen apart in the past and they have to do something. But right now they’re not talking about that. They’re talking about how we’re going to prop up the stock market this week…
I think the smaller nations, whatever they think is in their best interest. If they think they can get bailed out by hanging in there, sort of like what Greece did, yeah if they’re going to hang in there. But eventually it won’t work because printing money isn’t a solution.
So if they hang in there, and Scotland wants to be in there, well how are they going to continue to be allowed if the system doesn’t function? Eventually you have to produce wealth and what we’re doing is destroying wealth. You just can’t pretend and fool the people long enough. ‘A central bank creates wealth by creating money and printing it out of thin air.’ Well it doesn’t happen that way and I think the message is this system is coming to an end.