This afternoon, CNBC Europe asked Peter Schiff about the effects of low oil prices on the European economy. Peter used the opportunity to explain why the governments of Europe, the United States, and Japan are all playing the same game: claiming inflation is good for the economy, when in fact it just allows politicians to escape the responsibility of giant national debts. The truth is that higher inflation equates to a lower standard of living.

Follow along with this transcript of Peter's answers:

“First of all, falling oil prices are a good thing. They're good for the European economy. The only problem is, the low prices aren't going to last. I think it's temporary. The idea that Europe needs inflation is complete, utter nonsense. Economies benefit from falling prices. Imagine if oil were free. What if Europeans could have all the oil they wanted and it didn't cost anything? Wouldn't that be fantastic?

“I think the drop is temporary, because people are still factoring in a stronger US dollar. Because they think the Fed is out of the QE business, and they think the Fed is going to be raising rates in 2015. I think the Fed is going to be launching a much bigger quantitative easing program than Europe and Japan combined. I think that when all the money printing returns in the United States, you're going to see a big increase in oil prices for everybody.

“The idea that deflation, or low inflation, is a problem – again – is wrong. If the cost of food is down, that's a good thing. If the cost of healthcare goes down, that's a good thing. As the cost of living goes down, the people benefit. It's just government that wants inflation, because politicians don't want to cut government spending. They don't want to deal with all the deficits they ran up to buy votes. So they want to bail themselves out by creating inflation. But the people will suffer from the inflation the central banks are creating.