Texas House Republican and former presidential candidate Ron Paul says the world could soon wake up to realize that the U.S. government is the “biggest counterfeit machine in the history of the world.”

That realization would trigger a collapse in the dollar and could quickly lead to hyperinflation, Paul warned.

The crisis is “now,” not something for our children or grandchildren to face, he said.

“It will come to an end. And when it ends with the dollar crisis, everybody loses . . . and then there's political chaos. We're not immune to that,” Paul said in an interview on MSBNC.

We’re getting away with it, at least for now, because the Federal Reserve is printing money and constantly raising the debt limit, Paul said, enabling profligate public spending.

“If the Fed couldn't monetize debt and the debt limit couldn't be increased, (Congress would say) ‘Oh my goodness, we're going to have to change policies, maybe we shouldn't be the policemen of the world, maybe we shouldn't be the endless welfare state,’” Paul said.

Everything hinges now on trust in the U.S. dollar, which is still the most depended-upon global reserve currency.

“One day people will wake up and say 'Why are we trusting this counterfeit machine?'” Paul said.

“We're the biggest counterfeit machine in the history of the world.”

President Barack Obama’s deficit-cutting commission has garnered support from two key Republicans and a liberal Democrat but remained deadlocked and short of the 14 votes need to move its recommendations forward to Congress.

Republicans Tom Coburn, of Oklahoma, and Mike Crapo, of Idaho, joined New Hampshire’s Judd Gregg in support of the plan, which would cut the deficit by $3.8 trillion over a decade.

Democrat Richard J. Durbin, of Illinois, also said he would support the plan.

© Moneynews. All rights reserved. To subscribe or visit go to:  http://www.moneynews.com