"In a speech on Thursday Oct. 2, 2009, Congressman Brad Sherman (D-CA) told the House that several fellow Congressional representatives said they were threatened with the prospect of ‘Martial Law’ should they vote in opposition to the $700 billion bailout. Congressman Sherman’s revelation came after multiple claims that this threat was being ramped up to aid the bailout through the House.

According to numerous Congressional testimonies, the stark panic atmosphere which gripped both Congress and the US media was intentionally created in order to ‘fast-track’ a financial bailout bill. Several members of Congress were told before the vote that martial law might be instigated in America if the legislation failed.

During his speaking time, Sherman stated explicitly, “Many of us were told in private conversations, that if we didn’t pass this bill on Monday, the sky would fall, the market would drop two or three thousand points, another couple thousand the second day, and a few members were even told that there would be Martial Law in America if we voted no.”"

Earlier, Congressman Michael C. Burgess (R-TX) went public stating that House speaker Nancy Pelosi had declared House Rule 136A, effectively putting the House under “Martial Law” rules, a dictatorial measure only activated during times of national emergency.

On Thursday, November 20, 2008, Speaking on Tulsa Oklahoma’s 1170 KFAQ, when asked who was behind threats of martial law and civil unrest if the bailout bill failed, Senator James Inhofe (R-OK) named Treasury Secretary Henry Paulson as the source, having made such warnings during a conference call on September 19th, around two weeks before the legislation was eventually approved by both the Senate and House. He said, ‘This is serious. This is the most serious thing that we faced.’” Inhofe said that Paulson told members of Congress the crisis would be “far worse than the great depression” if Congress didn’t authorize the bill to buy out toxic debt, a proposal “which he abandoned the day after he got the money,” added Inhofe. Inhofe is referring to the controversy when it emerged that the bailout money was not going to buy up toxic debt but instead Paulson, the former CEO of Goldman Sachs, had pulled a bait and switch and ordered the money be injected directly into banks. Senator Inhofe has slammed the secrecy surrounding the destination of the bailout money, saying that Hank Paulson could have given it to his friends and that the “blank check” must be cancelled.

On January 30, 2009 (C-SPAN Washington Journal), Representative Paul Kanjorski (D-PA) reveals some facts that have not been captured by the media previously.

At 2 minutes and 20 seconds in the video, Kanjorski explains how the Federal Reserve told Congress members about a “tremendous draw-down of money market accounts in the United States, to the tune of $550 billion dollars.” According to Kanjorski, this electronic transfer occurred over the period of an hour or two. And it gets worse. Kanjorski paraphrases the following disclosure by Bernanke and Paulson:

On Thursday (Sept 18), at 11am the Federal Reserve noticed a tremendous draw-down of money market accounts in the U.S., to the tune of $550 billion was being drawn out in the matter of an hour or two. The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn’t be further panic out there. If they had not done that, their estimation is that by 2pm that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it. We are no better off today than we were 3 months ago because we have a decrease in the equity positions of banks because other assets are going sour by the moment.

How did this happen? Was it Adam Smith’s “Invisible Hand” or was it something more sinister?

Is our economic/political system so fragile that it could collapse in a matter of hours?

Congressman Kanjorski says that it was the truth as Secretary Paulson told it to him. You’ll note, however, that this threat of a global meltdown was left out of official stories at the time. Was Paulson telling Kanjorski the truth? If so, what are the chances that it could happen again?