The Department of Government Efficiency (DOGE) knew exactly where to look on the evening of the inauguration. They went where no one has been in almost 80 years: the payment systems of the U.S. Treasury Department. That’s the forbidden zone, and their entry caused five former Secretaries of the Treasury to melt down in a panic, protesting that no one but a handful of career civil service employees are allowed in there.
The headlines the following day registered panic, and it was not obvious why. Aren’t the government’s books always opened to the new administration? Is that not a normal feature of an executive transition? The answer, to the amazement of many, is no. They are never available to any administration. They are the private reserve of a tiny number of careerists.
In the days that followed, we saw more protests, objections, and a temporary restraining order from a federal judge. The general claim is that access to payment systems threatens to compromise long-held systems, violate privacy, put data in danger, and otherwise disrupt a system built over every presidential administration since Franklin Delano Roosevelt.
The judge’s order has been partially reversed, permitting DOGE to map and audit several departments at which they had been looking. But even now, DOGE is being denied full access to the payment systems, the portal from which $193 trillion has flowed since World War II that has never been examined by elected officials or their appointees, much less subjected to an independent audit.
We need to consider the implications and the justifications for this policy, by reference to the world of finance.
Back in the 1990s and early 2000s, Bernie Madoff’s high-flying hedge fund mysteriously beat all the markets for a full 17 years before it all came tumbling down with the big shift in financial markets in 2008. It turned out that he had been running a Ponzi scheme the entire time.
Madoff himself was a famous financial innovator and a well-connected former chairman of the Securities and Exchange Commission. He enjoyed huge credibility and a large network of investors, who poured in billions. No one had any reason to think he was up to no good.
The problems in the fund began early on, perhaps as early as the 1960s when the fund was founded, as Madoff covered minor losses in some accounts with new infusions from new accounts. It worked well and he gained a reputation for remarkable financial prowess. He would rebalance in good times and cover losses in bad times. Mostly this worked, and he gained confidence in the model.
It was widely believed that he was a genius with proprietary trading models that were consistently better than anyone else’s on Wall Street. He made frequent appearances at events and on television shows. He could certainly talk the talk. Everywhere he went, deep pockets begged him for an opportunity to invest.
Of course his strategy was hugely illegal. He knew it too but it kept working so he simply could not stop doing it. Throughout his career, he had seen many shady things and never intended to become the shadiest of all but market conditions began to deteriorate to the point that the coverage systemically swamped the earnings. That’s when the Ponzi scheme became the normal way of doing business.
Gradually, the account books and trading records slipped further and further away from public view, restricted to ever fewer people and finally only to a few. Not even Madoff’s own sons, slated to inherit the financial empire, were granted access, though they begged often to see what was behind the curtain.
The excuse for the privacy was always the same. He had proprietary models. He had confidential customer data. Outsiders could not look because that would risk the security of the entire firm. The fewer people who had access, the fewer people who could get blamed if something goes wrong. In time, the doors were locked.
The SEC was suspicious but ultimately did not press the issue. After all, Madoff had an impeccable reputation. Trust in him and his company took care of the rest.
At some point, outsiders became suspicious and started sounding alarms. It only took a bit of pressing around the edges to get him to cough up the truth. It was all a fiction. There were no gains but only losses to the tune of $64.8 billion. No one could believe it, least of all his friends, employees, and family. He had hid the secret from them all for decades.
One would think that this would be a lesson. The more companies generate excuses for outsiders never to look at the books, the more reason there is for suspicion. This is why every public company has regular outside audits.
Even the Founding Fathers figured this out, which is why Article I, Section 9, Clause 7 says: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.”
Doesn’t government do that? Many agencies face public audits but most fail most of the time. Congress passes budgets and gets reports on revenues. Myriad publications report on spending, debt, and deficits. It seems like we know what is what.
But do we really? Thanks to the work of DOGE, we are now aware that no one in almost 80 years has had access to the Treasury Department’s payment portals. We only know what we are told but nothing has ever been verified in any detail that can be checked against conventional methods and accounting standards that are just part of doing business in the private sector.
In the days following the penetration of the holiest of holies, we have heard every excuse for why DOGE or anyone else can’t have access. They say that outsiders will steal the data, that there are all sorts of secrets in there that cannot be seen, that Musk and so on are up to no good, as if there were any possibility that he could get away with anything sneaky with this level of public attention.
All the excuses are identical to those given for two decades and more by Bernie Madoff. With the U.S. Treasury, the stakes are slightly higher. Nothing has been fully subjected to normal standards of transparency since 1946, which means that some $193 trillion has come and gone from the federal government without verifiable accounting standards to which every single business adheres as a matter of daily operations.
And now judges are trying to stop it from happening. That too raises eyebrows and questions such as, what are they trying to hide and why? The best way to eliminate suspicions is transparency. The federal government has not exactly been a model when it comes to frugality and scrupulosity in finance. The only way to end this is to open the books, fully and with all professional standards.
If the Trump administration achieves this, it could be its finest hour, and change everything.
