Steve Forbes to Europe: Don't drag US over a cliff

Steve Forbes, chairman and editor-in-chief of Forbes Media, told CNBC on Tuesday that nobody involved in the Greek debt standoff knows what they are doing.

"They seem intent on going over the cliff. I just hope they don't drag us with them," the two-time Republican presidential candidate said in a "Squawk Box" interview.

As for the so-called troika of the European Central Bank, International Monetary Fund, and European Commission, "they're sense of austerity is: 'Don't hit the government too hard and smash the private sector with higher taxes and new regulations,'" Forbes added.

The German approach of "tighten up [and] starve to death" won't work either, he said. "So both sides in this don't have it right in terms of how you get these economies back on their feet."

Read MoreGreece needs to play by the rules: France

Forbes argued a combination of "stable money, low tax rates, [and] sensible regulation" would lead to Europe come back "pretty quickly."

The populist movement in Europe is also present in America, which could influence the 2016 U.S. presidential election, he said. "If Elizabeth Warren ran—I'm not sure she would—she would be a formidable contender against Hillary Clinton."

Sen. Elizabeth Warren
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Sen. Elizabeth Warren

Sen. Warren, D-Mass., is viewed as a champion of putting the power in the hands of the people. "The base of that party, the Democrat party, wants an alternative," Forbes said.

As for a matchup between Clinton, an ex-senator and former Obama secretary of state, and Republican Jeb Bush, former governor of Florida, he said, "I think Jeb wins."

"I think the country is in a mood" for change, he said, but added "there's keen interest in [Wisconsin Gov.] Scott Walker and other candidates."

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