In a weekly column, Libertarian and former Texas congressman Ron Paul echoed the words of economist Nouriel “Dr. Doom” Roubini, who has warned that the massive debt held by individuals, businesses, and the government will soon lead to the “mother of all economic crises.”

A former member of President Bill Clinton’s Council of Economic Advisors, Roubini was one of the few mainstream economists to predict the collapse of the housing bubble and his predictions bear repeating, according to Dr. Paul.

“Roubini properly blames the creation of a debt-based economy on the near-or-at-zero interest rate and quantitative easing policies pursued by the Federal Reserve and other central banks,” Paul wrote in a Dec. 12 column for his Ron Paul Institute for Peace and Prosperity. “The inevitable result of the zero-interest and quantitative easing policies is price inflation wreaking havoc on the American people.”

Paul, 87, is a critic of U.S. federal government fiscal policies, especially the Federal Reserve and tax policy. He is also not a fan of the military–industrial complex, the war on drugs, the war on terror, and mass surveillance. A former Texas congressman who served in the House for 25 years, Paul is seen as the “intellectual godfather” of the Tea Party movement. Currently aligned with the Libertarian Party, Paul has also served as a Republican. He ran for president in 1988, 2008, and 2012.

The Ron Paul Institute for Peace and Prosperity is a project of Paul’s Foundation for Rational Economics and Education, founded in the 1970s as an educational organization. The institute expands Paul’s public advocacy for a peaceful foreign policy and the protection of civil liberties at home.

Roubini has a history of making pessimistic — but often correct — economic forecasts. In a Dec. 30 column for Project Syndicate, he predicted that an inflationary-debt disaster is inevitable and could last for years.

The Fed’s efforts to eliminate price inflation with interest rate increases have not worked so far, Paul wrote, because interest rates remain at historic lows. By comparison, in the 1970s, inflation rates were high and interest rates rose to nearly 20 percent.

Recent rate increases have led to lower demand for new homes. “Increasing interest rates make it impossible for many middle- and working-class Americans to afford a monthly mortgage payment for even a relatively inexpensive home,” Paul said.

The Fed can’t raise rates to “anywhere near what they would be in a free market,” Paul wrote, because it would affect the government’s ability to manage its debt.

Interest on the national debt is already on its way to consuming 40 percent of the federal budget by 2052 and will exceed defense spending by 2029, Paul wrote, citing the Congressional Budget Office.

Exacerbating the debt problem, Medicare will begin to run deficits by 2028 and Social Security by 2035, Paul wrote. If the Fed “raises rates to the levels needed to really combat price inflation, the increase in interest payments will impose hardships on individuals and businesses, as well as raise federal interest payments to unsustainable levels. This will cause a major economic crisis including a government default on its debt causing a rejection of the dollar’s world reserve currency status. Also, if the Fed continues to facilitate federal deficits by monetizing the debt, the result will be an economic crisis caused by a collapse in the dollar’s value and rejection of the dollar’s world reserve status.”

Paul predicts a crisis leading to social unrest, violence, and increased popularity of authoritarian movements. This will lead to government crackdowns on civil liberties and increased government control of the economy, he wrote.

There is no historical precedent for an economic crisis in the U.S. leading to social unrest and violence, according to David Muhammad, an expert in violence intervention and criminal justice policy for 15 years.

“Despite our natural instinct to think that downturns in the economy produce an increase in crime and violence, that’s not the case,” said Muhammad, executive director of the National Institute for Criminal Justice Reform.

Muhammad was quoted speaking about the aftermath of the covid pandemic in City Monitor, a publication devoted to urban policy from the New Statesman Media Group. 

“The other great economic cataclysms of the past 100 years, the Great Recession of the 2000s and the Great Depression of the 1930s, did not see huge spikes in violence either,” Muhammad said. “Even the trough of the Reagan administration’s recession in 1982 saw a decline in killing from the elevated rates of the previous three years. This flies in the face of the popular myth that as people get more desperate and unemployment mounts, murder and mayhem spread as well.”