Inhofe: Paulson used scare tactics, suggested martial law to senators

Sen. James Inhofe (R-OK) was recently on the "The Pat Campbell Show" on 1170 KFAQ, a radio station in Tulsa, Oklahoma.  During the call, he divulged details of a conference call between US Senators and Treasury Secretary Henry Paulson from mid-September.  According to Inhofe, this conference call is where the threats of economic collapse, civil unrest, and the potential for martial law originated:

"We had a conference call early on. It was on a Friday I think – a week and half before the vote on Oct. 1. So it would have been the middle … what was it – the 19th of September, we had a conference call. In this conference call – and I guess there’s no reason for me not to repeat what he said, but he [Paulson] said – he painted this picture you just described. He said, 'This is serious. This is the most serious thing that we faced.'"

You can listen to the audio of the interview here:

Clearly this is a very serious allegation. Even though the Congress, Treasury, and Federal Reserve were facing a major issue, to suggest this would ultimately lead to martial law was absolutely a strong-arming tactic.

I'm shocked Paulson or anyone else associated with the Bush administration (or the Federal Reserve for that matter) would think this approach could be used to convince senators to vote for the bailout. Even bringing up the idea of martial law, which could have conceivably postponed the election, should warrant a Congressional investigation.

What's most funny about all of this is Paulson demanded all this money to ensure the government could buy toxic assets, then no less than a week later decides the money is better spent investing into banks. So much for the sense of urgency and warnings he gave to everyone.