It’s Paul Kanjorski, no stranger to blabbing about unpleasant truths, regaling C-SPAN last month with the economic equivalent of the Stanislav Petrov story. Remember the reports that trickled out in mid-September about a harrowing briefing Paulson and Bernanke had given to Congress? The specifics were never revealed, but whatever they said scared the hell out of attendees:
“When you listened to him describe it you gulped,” said Senator Charles E. Schumer, Democrat of New York.
As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”
Mr. Schumer added, “History was sort of hanging over it, like this was a moment.”
When Mr. Schumer described the meeting as “somber,” Mr. Dodd cut in. “Somber doesn’t begin to justify the words,” he said. “We have never heard language like this.”
Take a drink of something hard and watch from 2:20 to 3:45. Now you know the specifics. This Journal story from that week described the financial turmoil through Wednesday afternoon, at which point $144.5 billion had already been yanked out of money markets, and then skipped ahead to Paulson and Bernanke meeting with Congress on Thursday night without a mention of what happened in between. That’s how closely guarded this secret must have been.