Is this the end of the E.U.?

Police investigators arrive outside the Bataclan concert hall the morning after a series of deadly attacks in Paris, November 14, 2015.
Charles Platiau | Reuters
Police investigators arrive outside the Bataclan concert hall the morning after a series of deadly attacks in Paris, November 14, 2015.

It's always the things you don't expect that get you. After banking scandals, currency issues, and a Greek/Portugese/Spanish debt crisis just about every six months, the economic and political partnership that is the European Union seems much more likely to fall apart for an entirely different reason after all.

That reason is ISIS.

The direct cause is actually an extremely divisive and growing dispute about open borders, immigration, and refugee resettlement. But that conflict just became a lot more serious thanks to the horrific ISIS terrorist attacks in Paris Friday night. Now, this discussion has grown and migrated, (pun intended), from a political debate among E.U. elites to the #1 pressing issue on the streets of Europe. When relatively smaller economic nations like Hungary began closing their borders to migrants and Syrian refugees last month, it could be written off as perhaps an isolated incident. But all bets are off now that France is closing its borders in response to the attacks, even if it is just temporarily. That's because in so doing, President Francois Hollande has unambiguously connected the border issue with the effort to fight the spread of terror. It's so obvious that even the most politically uninterested person can see what it means. And just in case the message still isn't entirely clear to everyone, one of the major stories in Europe today is about how the alleged mastermind of the Paris attacks, Abdelhamid Abaaoud, boasted in videos about how easily he crisscrossed the borders of the E.U. for years.

Read MoreDid this guy just give the GOP the White House?

This is a political nightmare for the statist bureaucrats who have been working for decades to reduce true representative democracy all for the goal of a unified and monolithic economic entity without worrying about being hindered by annoying little things like the will of the people. Before these attacks and the border response, the E.U. simply glossed over dissent and most attempts to challenge its un-elected sovereignty. Its best weapon in that fight has always been using the accusations of racism and xenophobia against those who refused to integrate and obey the E.U. fully and quickly enough in all matters of economics, immigration, and tax law. With a mostly compliant state-sponsored news media on its side, the "racist" and "xenophobic" label has been used the most against Britain's anti-E.U. UKIP party more and more in recent years. UKIP does keep gaining in popularity in the U.K., but it still has to fight very hard to beat back those scare tactic accusations.

But what do the people who spread accusations of racism and xenophobia do now that more Europeans than ever believe their governments are sacrificing their safety in favor of remaining compliant with E.U. immigration dogma? The simple answer is that they're in trouble, and no amount of sanctimonious shaming or economic threats will do much good when the majority of the public doesn't feel safe anymore.

The economic aspect of this discussion is important, because attacks like these should humble those who think better economic opportunities are not only the best answer to anti-E.U. activists but also the best way to beat back the causes of terrorism. Even with the cases of the very wealthy Osama bin Laden and the very upper middle class "Underwear Bomber" at our fingertips, most of us continue to foolishly think that homicidal terrorists are really just angry about bad job prospects and all we have to do is get them some welfare and a spot in a housing project and everything will be okay. The truth is evil people who commit evil acts transcend economic trigger points, which is why you can get mugged by a poor person the same day that a billionaire banker cheats you out of your retirement savings and a rich terrorist tries to blow up an airliner with a bomb in his pants.

Read MoreCan the private sector beat public transit?

Meanwhile, the E.U.'s constant refrain of, "only a unified and less democratic Europe can compete in the changing global market," is just as tired and demonstrably false. No one's going to care about that if people don't feel safe in their own homes or at concerts and cafes. Keeping all of Europe in line on restructuring Greek debt every few months is one thing, but maintaining a consensus on border security and immigration laws is starting to become impossible. And without uniform border and immigration laws, a unified E.U. cannot continue. That's something everyone from Angela Merkel to a low level currency trader understands.

And as this process unfolds overseas, the questions multiply about what the United States is doing for refugees from Syria and immigrants overall. Like the Europeans today, more Americans are wondering why it's racist, selfish, or xenophobic to ask whether a sovereign nation has the right to err on the side of safety when it comes to controlling its borders. And if the federal immigration agencies continue to tell us that they cannot properly vet all incoming refugees, why is it wrong to limit their entrance based on the number of people the federal government can properly screen? The refugee question won't bring down the American federal government, but it could significantly diminish its power to unilaterally dictate where and how refugees and even future immigrants enter the country.

Read MoreYour government or your life

Back in Europe, if ISIS and ISIS-like threats and attacks continue the E.U. could end up morphing into a far more useful and manageable multinational counter-terrorism force. Or it may just disintegrate altogether as each nation decides it doesn't want to rely on another nation's security efforts and priorities. The funny thing about all of this is that the most anti-freedom entity in the Islamic world, ISIS, is serving to destroy one of the most anti-freedom entities in the Western World, the E.U. To be fair, no matter how bureaucratic and doctrinaire the E.U. has been even it doesn't deserve to go down in such a horrific and violent manner. But unless ISIS and the other terrorists suddenly decide to leave Europe alone, the E.U. will likely go down just the same.

Commentary by Jake Novak, supervising producer of "Power Lunch." Follow him on Twitter @jakejakeny.