A major moment for the new Trump administration came when in the first week the employees of DOGE gained access to the Treasury Department’s payment systems. They could not change anything. They could only look at what was happening, provide new mappings, and generally figure out what was going on behind the scenes.
The headlines on all legacy media registered an implausible level of alarm about this, as if barbarians had invaded the holiest of holies. It was hard to understand the high dudgeon about this. Would it not be a normal and routine thing for a new administration to have access to and knowledge of payment systems in the government it now led?
Apparently not. Who knew? In a system of government controlled by the people, a new administration voted in by the people should have access to the books in order to serve the people well and assure high standards. It seems extremely strange that such would not be the case.
If you had any doubt about how shocking this was to D.C. elites, five former secretaries of the Treasury have written an article for the New York Times. Their names are Robert Rubin, Lawrence Summers, Timothy Geithner, Jacob Lew, and Janet Yellen. All five served in Democratic administrations, but what they reveal pertains to every administration since the end of World World II.
“The nation’s payment system has historically been operated by a very small group of nonpartisan career civil servants. In recent days, that norm has been upended, and the roles of these nonpartisan officials have been compromised by political actors from the so-called Department of Government Efficiency. One has been appointed fiscal assistant secretary—a post that for the prior eight decades had been reserved exclusively for civil servants to ensure impartiality and public confidence in the handling and payment of federal funds.”
I had to read that several times to believe my eyes. Did you know that presidents and their appointments have not had access to payment systems since 1946? I did not. Did you know that the entire nation has been dependent on “a very small group” of career bureaucrats to manage the multiple trillions coming and going without oversight from anyone who voters have elected? I did not know that.
This is a tremendously alarming fact and it explains perhaps why the nation’s debt is out of control, why no one seems to be able to manage the budget, why the voters have had so little real influence, and why we’ve had so little transparency.
Maybe that is also why close to a quarter of the nation’s spending is estimated to be drained away in waste, fraud, and abuse, and why so many agencies of the federal government, including the Pentagon, cannot pass a normal audit. Many agencies have never faced an outside audit of the sort that is wholly normal in the corporate world.
This announcement is so shocking to me that I’m still working through in my mind what possibly this could mean. Maybe that accounts for the tremendous alarm that came when DOGE managed to break through and see what is going on. Apparently this has never happened before.
Consider the implications.
All experience in business suggests the following rule. If you do not have access to the accounting books, in order to verify the comings and goings over the funds, you are not really in control of the company.
Imagine if you had a new CEO and he appointed a new CFO and so on, along with an auditing team. He was suddenly told that there are people who manage the books and he and his team cannot have access. He is further told that this has been going on for 80 years with no change. What would that imply about the CEO himself? It would mean that he is not really in charge. I doubt that any competent business would accept such a deal.
It would make no sense for someone to be accountable for results in any institution but, at the same time, have no real access to the beating heart of the institution, which is the accounting books.
There are times when the headline person responsible does not have access but this is a troubling situation. I once had an idea for a startup business and sought out funding which I obtained. In order to make the deal possible, however, I had to give up most of my shares of the company to the venture funding sources, as one does.
I did not know the implications of this at the time. It meant that I had no real control over the finances and thus no real control over the future of the company itself. I was in the position of being the face of the company and nothing more. This became frustrating for me over time but anyone with experience should have known about this problem. I just didn’t have the experience.
One lives and learns. One of the things I learned is that if you are not watching the coming and going of every nickel in a company, or in principle cannot readily access that information, there is a word for you: you are an employee. You might have lots of decision-making power day-to-day but, in the end, you are not really in charge.
I can recall that as a young employee in a clothing store in my teens, we all met in the backroom after closing and looked at the sales for the day. They were even put on a chart and the employee records made public. It created an invigorating atmosphere of competitiveness. We all liked it and it gave us a sense of having a stake in the future of the company. That’s great and wonderful and we all appreciated the transparency. But it was different knowing the daily sales figures from knowing the deeper cost structures, overall revenue flows, the liabilities, and the prospects. None of that information we knew. We did not need to know.
Every company works this way: the finances are the inner sanctum and available on a need-to-know basis. When in the United States you take your company public and have ownership stakes listed on public markets, it’s an absolute requirement that you have completely open books for all stockholders to examine. This is just the way business is done. Outside auditors are there to assure the integrity of all the data too.
Why doesn’t government work this way? This is a profoundly good question. I’m not sure that this question has really been asked often in the American political context. In retrospect, it is obviously the most salient one.
What happened here with the Trump administration and DOGE is that it was beginning the process of opening the books, starting with data access about payments coming and going, a reorganization of the databases, and a modernization including possibly a public listing on a blockchain. This was the essential precondition for bringing in the auditors to give a full accounting of what precisely is going on.
Sure enough, a federal judge interfered, essentially siding with the “very small group of nonpartisan career civil servants” over the people elected to oversee the executive branch. It seems incredible but that is what has happened. We now await appeals and judgments from higher courts to decide whether and to what extent elected officials can have access to the beating heart of the government’s finances.
I hope you can see the stakes here. Apparently, for the better part of 80 years, government financial operations have been undertaken largely in secret, outside the purview of the people and their elected representatives. Once you fully understand the implications of that, and the desire to open the books to the public, you gain greater insight into the controversies now roiling public life in America.
