War, Martial Law, and the Economic Crisis
Peter Dale Scott
by Peter Dale Scott: The
Doomsday Project, Deep Events, and the Shrinking of American Democracy
is an excerpt of a chapter by Peter Dale Scott from the new
book by Global Research Publishers, The
Global Economic Crisis: The Great Depression of the XXI Century.
Treasury’s Financial Bailout
measures of late 2008 may have consequences at least as grave for
an open society as the response to 9/11 in 2001. Many members of
Congress felt coerced at the time into voting against their inclinations,
and the normal procedures for orderly consideration of a bill were
for bypassing normal legislative procedures was the existence of
an emergency. But one of the most reprehensible features of the
legislation, that allowed Treasury Secretary Henry Paulson to permit
bailed-out institutions to use public money for exorbitant salaries
and bonuses, was inserted by Paulson after the immediate crisis
Congressman Peter Welch (D-Vermont) the bailout bill originally
called for a cap on executive salaries, but Paulson changed the
requirement at the last minute. Welch and other members of Congress
were enraged by "news that banks getting taxpayer-funded bailouts
are still paying exorbitant salaries, bonuses, and other benefits."
In addition, as the Associated Press reported in October 2008, "Sen.
Charles Schumer, D-N.Y. questioned allowing banks that accept bailout
bucks to continue paying dividends on their common stock. ‘There
are far better uses of taxpayer dollars than continuing dividend
payments to shareholders,’ he said."
Even more reprehensible
is the fact that after the bailouts, Paulson and the Treasury Department
refused to provide details of the Troubled Assets Relief Program
(TARP) spending of hundreds of billions of dollars, while the New
York Federal Reserve refused to provide information about its own
bailout (using government-backed loans) that amounted to trillions.
This lack of transparency was challenged by Fox TV in a FOIA suit
against the Treasury Department, and a suit by Bloomberg News against
bailout legislation of September 2008 was only passed after members
of both Congressional houses were warned that failure to act would
threaten civil unrest and the imposition of martial law.
U.S. Sen. James
Inhofe, R-Okla., and U.S. Rep. Brad Sherman, D-Calif., both said
U.S. Treasury Secretary Henry Paulson brought up a worst-case scenario
as he pushed for the Wall Street bailout in September. Paulson,
former Goldman Sachs CEO, said that might even require a declaration
of martial law, the two noted.
Here are the
original remarks by Senator Inhofe:
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 named Treasury Secretary Henry Paulson as the source.
"Somebody in D.C. was feeding you guys quite a story prior to
the bailout, a story that if we didn’t do this we were going to
see something on the scale of the depression, there were people
talking about martial law being instituted, civil unrest... who
was feeding you guys this stuff?," asked host Pat Campbell. "That’s
Henry Paulson," responded Inhofe. "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 said – he painted this picture you just described.
He said, ‘This is serious. This is the most serious thing that
Rep. Brad Sherman
(D-CA 27th District) reported the same threat on the Congressional
way they can pass this bill is by creating a panic atmosphere...
Many of us were told that the sky would fall... A few of us were
even told that there would be martial law in America if we voted
no. That’s what I call fear-mongering, unjustified, proven wrong.
So it is clear
that threats of martial law were used to get this reprehensible
bailout legislation passed. It also seems clear that Congress was
told of a threat of martial law, not itself threatened. It is still
entirely appropriate to link such talk to the Army’s rapid moves
at the time to redefine its role as one of controlling the American
people, not just protecting them. In a constitutional polity based
on balance of powers, we have seen the emergence of a radical new
military power that is as yet completely unbalanced.
of Operations (COOP)
New Role in 2001: Not Protecting American Society, but Controlling
It. This new role for the Army is not wholly unprecedented. The
U.S. military had been training troops and police in "civil disturbance
planning" for the last three decades. The master plan, Department
of Defense Civil Disturbance Plan 55-2, or "Operation Garden Plot,"
was developed in 1968 in response to the major protests and disturbances
of the 1960s.
But on January
19, 2001, on the last day of the Clinton administration, the U.S.
Army promulgated a new and permanent Continuity of Operations (COOP)
Program. It encapsulated its difference from the preceding, externally
oriented Army Survival, Recovery, and Reconstitution System (ASRRS)
a. In 1985,
the Chief of Staff of the Army established the Army Survival,
Recovery, and Reconstitution System (ASRRS) to ensure the continuity
of essential Army missions and functions.
was focused primarily on a response to the worst case 1980’s threat
of a massive nuclear laydown on CONUS as a result of a confrontation
with the Soviet Union.
b. The end
of the Cold War and the breakup of the former Soviet Union significantly
reduced the probability of a major nuclear attack on CONUS but
the probability of other threats has increased. Army organizations
must be prepared for any contingency with a potential for interruption
of normal operations.
that Army continuity of operations planning is now focused on the
full all-hazards threat spectrum, the name "ASRRS" has been replaced
by the more generic title "Continuity of Operations (COOP) Program.
embodied the secret Continuity of Government (COG) planning conducted
secretly by Rumsfeld, Cheney and others through the 1980s and 1990s.
This planning was initially for continuity measures in the event
of a nuclear attack, but soon called for suspension of the Constitution,
not just "after a nuclear war" but for any "national security emergency".
This was defined in Reagan’s Executive Order 12656 of November 18,
1988, as "any occurrence, including natural disaster, military attack,
technological emergency, or other emergency, that seriously degrades
or seriously threatens the national security of the United States."
The effect was to impose on domestic civil society the extreme measures
once planned for a response to a nuclear attack from abroad. In
like fashion, ARR 500-3 Regulation clarified that it was a plan
for "the execution of mission-essential functions without unacceptable
interruption during a national security or domestic emergency."
who as a private citizen had helped author the COG planning, promptly
signed and implemented the revised ARR 500-3. Eight months later,
on 9/11, Cheney and Rumsfeld implemented COG, a significant event
of which we still know next to nothing. What we do know is that
plans began almost immediately – as foreseen by COG planning the
1980s – to implement warrantless surveillance and detention of large
numbers of civilians, and that in January 2002 the Pentagon submitted
a proposal for deploying troops on American streets.
Then in April
2002, Defense officials implemented a plan for domestic U.S. military
operations by creating a new U.S. Northern Command (CINC-USNORTHCOM)
for the continental United States. In short, what were being implemented
were the most prominent features of the COG planning which Oliver
North had worked on in the 1980s.
and Changes of Party in the White House
Like so many
other significant steps since World War Two towards a military-industrial
state, the Army’s Regulation 500-3 surfaced in the last days of
a departing administration (in this case the very last day). It
is worth noticing that, ever since the 1950s, dubious events – of
the unpublic variety I have called deep events – have marked the
last months before a change of party in the White House. These deep
events have tended to a) constrain the incoming president, if he
is a Democrat or, alternatively, b) to pave the way for the incomer,
if he is a Republican.
the first category, the following (when a Republican was succeeded
by a Democrat):
- In December
1960 the CIA secured approval for the Bay of Pigs invasion of
Cuba, and escalated events in Laos into a crisis for which the
Joint Chiefs proposed sending 60 000 troops. These events profoundly
affected President Kennedy’s posture towards Cuba and Indochina.
- In 1976
CIA Director George H.W. Bush installed an outside Team B intelligence
unit to enlarge drastically estimates of the Soviet threat to
the United States, eventually frustrating and reversing presidential
candidate Jimmy Carter’s campaign pledge to cut the U.S. defense
were events in the second category (when a Democrat was succeeded
by a Republican):
- In late
1968 Kissinger, while advising the Johnson administration, gave
secret information to the Nixon campaign that helped Nixon to
obstruct the peace agreement in Vietnam that was about to be negotiated
at the peace talks then taking place in Paris. (According to Seymour
Hersh, "The Nixon campaign, alerted by Kissinger to the impending
success of the peace talks, was able to get a series of messages
to the Thieu government" in Saigon, making it clear that a Nixon
presidency would offer a better deal. This was a major factor
in securing the defeat of Democratic candidate Hubert Humphrey.
Kissinger was not the kind of person to have betrayed his president
on his own personal initiative. At the time Nixon’s campaign manager,
John Mitchell (one of the very few in on the secret), told Hersh,
"I thought Henry [Kissinger] was doing it because Nelson [Rockefeller]
wanted him to. Nelson asked Henry to help and he did."
- In 1980
the so-called October Surprise, with the help of people inside
the CIA, helped ensure that the Americans held hostage in Iran
would not be returned before the inauguration of Reagan. This
was a major factor in securing the defeat of incumbent Jimmy Carter.
Once again, the influence of the Rockefellers can be discerned.
A CIA officer later reported hearing Joseph V. Reed, an aide to
David Rockefeller, comment in 1981 to William Casey, the newly
installed CIA Director, about their joint success in disrupting
Carter’s plans to bring home the hostages.
Both the financial
bailout, extorted from Congress and the escalated preparations for
martial law can be seen as transitional events of the first category.
Whatever the explanations for their timing, they constrained Obama’s
freedom to make his own policies. Moreover they have the consequence
of easing this country into unforeseen escalations of the Afghan
Quiet Preparations for Martial Law
Let us deal
first with the preparations for martial law. In late September 2008,
at the height of the financial meltdown, The Army Times announced
the redeployment of an active Brigade Army Team from Iraq to America,
in a new mission that "may become a permanent part of the active
The 3rd Infantry
Division’s 1st Brigade Combat Team has spent 35 of the last 60
months in Iraq patrolling in full battle rattle, helping restore
essential services and escorting supply convoys.
training for the same mission – with a twist – at home.
Oct. 1 for 12 months, the 1st BCT will be under the day-to-day
control of U.S. Army North, the Army service component of Northern
Command, as an on-call federal response force for natural or manmade
emergencies and disasters, including terrorist attacks… After
1st BCT finishes its dwell-time mission, expectations are that
another, as yet unnamed, active-duty brigade will take over and
that the mission will be a permanent one... They may be called
upon to help with civil unrest and crowd control.
followed by two weeks the talk of civil unrest and martial law that
was used to panic the Congress into passing Paulson’s bailout legislation.
Not only that, the two unprecedented events mirror each other: the
bailout debate anticipated civil unrest and martial law, while the
announced positioning of an active Brigade Combat Team on U.S. soil
anticipated civil unrest (such as might result from the bailout
Then on December
17, 2008, U.S. Northern Command chief General Renuart announced
that "the US military plans to mobilize thousands of troops to protect
Washington against potential terrorist attack during the inauguration
of president-elect Barack Obama."
The U.S. Army
War College also raised the possibility of the U.S. Army being used
to control civil unrest, according to the Phoenix Business Journal:
A new report
by the U.S. Army War College talks about the possibility of Pentagon
resources and troops being used should the economic crisis lead
to civil unrest, such as protests against businesses and government
or runs on beleaguered banks.
civil violence inside the United States would force the defense
establishment to reorient priorities in extremis to defend basic
domestic order and human security," said the War College report.
says economic collapse, terrorism and loss of legal order are
among possible domestic shocks that might require military action
within the U.S.
It is clear
that there has been a sustained move in the direction of martial
law preparations, a trend that has been as continuous as it has
been unheralded. Senator Leahy was thus right to draw our attention
to it on September 29, 2006, in his objections to the final form
of the Fiscal Year 2007 National Defense Authorization Act, which
gave the president increased power to call up the National Guard
for law enforcement:
concern us all that the Conference agreement includes language
that subverts solid, longstanding Posse Comitatus statutes that
limit the military’s involvement in law enforcement, thereby making
it easier for the President to declare martial law. There is good
reason for the constructive friction in existing law when it comes
to martial law declarations.
agglomeration of military power has not "just growed", like Topsy,
through inadvertence. It shows sustained intention, even if no one
has made a public case for it.
from Global Research.
For article with footnotes, click
Dale Scott, a former Canadian diplomat and English Professor at
the University of California, Berkeley, is the author of Drugs
Oil and War, The
Road to 9/11, and The
War Conspiracy: JFK, 9/11, and the Deep Politics of War.
His book, Fueling America's War Machine: Deep Politics and the
CIAs Global Drug Connection is in press, due Fall 2010
from Rowman & Littlefield.
© 2011 Peter