The Treasury’s Transparency Troubles: What Are They Hiding?

In recent years, there has been a growing debate over financial privacy and government transparency. On one side, we have seen aggressive pushes by the Internal Revenue Service (IRS) to gain unprecedented access to Americans’ personal bank account information. On the other, we have a Treasury Department that seems increasingly reluctant to provide details on its own spending practices. This glaring contradiction raises serious questions about the government’s commitment to transparency and accountability.

The IRS’s Bank Account Snooping Proposal

Let’s start by examining the IRS’s recent attempts to dramatically expand its surveillance of Americans’ financial lives. In 2021, as part of the Biden administration’s “Build Back Better” plan, the IRS proposed requiring banks and other financial institutions to report inflows and outflows for all accounts with more than $600 in annual transactions81. This would have given the tax agency visibility into the vast majority of Americans’ bank accounts.

The proposal was met with immediate and intense backlash from privacy advocates, financial institutions, and lawmakers on both sides of the aisle. Critics argued it represented a massive overreach that would infringe on law-abiding citizens’ financial privacy while doing little to actually catch wealthy tax cheats8182.

In response to the outcry, the Treasury Department attempted to mollify concerns by raising the reporting threshold to $10,000 and exempting wage and salary deposits80. But even this amended version faced steep opposition. The American Bankers Association vowed to fight any expanded reporting requirements, regardless of the dollar threshold80.

Ultimately, the bank account reporting provision was dropped from the final legislation. But the episode highlighted the government’s appetite for sweeping new financial surveillance powers – all in the name of enforcing tax compliance and closing the so-called “tax gap.”

Throughout the debate, IRS officials and supporters of the proposal repeatedly invoked a familiar refrain: If you have nothing to hide, why are you worried about us looking at your bank account? Treasury Secretary Janet Yellen herself made this argument, telling CBS News: “If somebody reports an income of $10,000 and they had 3 million [dollars] go out of their checking account, that tells the IRS that’s an individual you might audit.”80

This “nothing to hide” logic attempts to frame privacy concerns as evidence of wrongdoing. It’s a rhetorical sleight of hand designed to put law-abiding citizens on the defensive for simply wanting to maintain the confidentiality of their personal financial information.

The Treasury’s Transparency Troubles

Now let’s examine how this same “nothing to hide” standard is applied – or rather, not applied – to the Treasury Department’s own financial practices.

In recent years, there have been growing concerns about the lack of transparency surrounding Treasury’s spending and financial operations. The department responsible for managing the government’s finances has shown an alarming reluctance to provide detailed information about its expenditures and decision-making processes.

One glaring example is the controversy surrounding the Department of Government Efficiency (DOGE), a task force established by the Trump administration to find ways to cut federal spending70. In early 2025, it was revealed that Treasury Secretary Scott Bessent had granted DOGE representatives unprecedented access to the federal payment system, which processes over $5 trillion in annual disbursements70.

This decision immediately raised red flags among privacy advocates, lawmakers, and career Treasury officials. David Lebryk, a senior civil servant with over 35 years of experience at Treasury, reportedly pushed back against granting DOGE such broad access. He was subsequently placed on leave and abruptly retired70.

The level of access granted to DOGE remains unclear, with conflicting reports about whether it was truly “read-only” or if the team had more expansive capabilities70. What is clear is that this move potentially gave a group of political appointees visibility into highly sensitive financial data and payment systems.

When pressed for details about DOGE’s access and activities, Treasury officials have been evasive. In a letter to Senator Ron Wyden, the department claimed that DOGE’s review “is not resulting” in any payment suspensions or delays69. But this carefully worded statement does little to address the fundamental concerns about why this outside group was given such unprecedented access in the first place.

The DOGE controversy is just one example of Treasury’s troubling lack of transparency. Other areas of concern include:

1. Incomplete reporting to USAspending.gov: A Government Accountability Office (GAO) report found that 49 federal agencies failed to report spending data to USAspending.gov, the official website for tracking federal expenditures73. This massive blind spot undermines the site’s ability to provide a comprehensive picture of government spending.
2. Discrepancies in COVID-19 spending reports: The same GAO report identified significant discrepancies between COVID-19 spending amounts reported to USAspending.gov and those listed in agencies’ budget and financial reports. For example, Treasury’s reported COVID-19 obligations exceeded the amount on USAspending.gov by over $195 billion73.
3. Difficulty accessing data limitation disclosures: While Treasury has created a webpage for agencies to provide context on data limitations, the GAO found that these disclosures are often not easily accessible to users of USAspending.gov83. This lack of prominence means many users may draw incorrect conclusions from incomplete or flawed data.
4. Resistance to oversight: During the 2021 debt ceiling crisis, Treasury was criticized for not providing timely information to the GAO about its use of “extraordinary measures” to avoid defaulting on obligations84. This lack of transparency hindered Congress’s ability to conduct proper oversight during a period of extreme fiscal stress.
5. Inadequate explanation of spending decisions: A 2024 report by the UK’s Institute for Government criticized Treasury for failing to clearly articulate its spending intentions and taking decisions without sufficient information75. While focused on the UK Treasury, many of these critiques apply equally to its US counterpart.

The Glaring Double Standard

When we juxtapose the IRS’s push for sweeping new surveillance powers with Treasury’s reluctance to provide basic transparency about its own operations, a troubling double standard emerges.

On one hand, we’re told that law-abiding citizens should have no objection to the government peering into their bank accounts. If you’ve done nothing wrong, what do you have to hide?

Yet when it comes to its own finances, Treasury often operates behind a veil of secrecy. Detailed information about spending decisions, access to sensitive systems, and even statutorily required reporting is withheld or obscured from public view.

This hypocrisy undermines public trust and raises serious questions about the department’s commitment to transparency and accountability. If Treasury truly believes in the “nothing to hide” principle, shouldn’t it be leading by example?

The Importance of Financial Privacy

Before we go further, it’s worth examining why financial privacy matters – both for individuals and for government institutions.

For individuals, financial privacy is a fundamental right that protects against unwarranted intrusion, discrimination, and potential abuse. Our financial transactions paint an intimate portrait of our lives – our medical conditions, political affiliations, personal relationships, and more. Granting the government unfettered access to this information represents a serious erosion of civil liberties.

Moreover, history has shown that expansive government surveillance powers are often abused. The IRS itself has a troubling track record in this regard, from its targeting of civil rights leaders in the 1960s to more recent controversies involving the alleged targeting of conservative groups81.

For government institutions like Treasury, a degree of confidentiality is sometimes necessary to protect sensitive negotiations, prevent market manipulation, and safeguard national security. However, this need for discretion must be balanced against the public’s right to know how their tax dollars are being spent.

Excessive secrecy in government finance can lead to waste, fraud, and abuse. It can also erode public trust and fuel conspiracy theories. When citizens feel the government is hiding information about its spending practices, it breeds skepticism about the entire system.

The Case for Greater Treasury Transparency

Given the vast sums of money flowing through Treasury and its outsized impact on the economy, there is a compelling public interest in greater transparency from the department. Here are some key areas where improved disclosure and accountability are needed:

1. Detailed spending breakdowns: Treasury should provide more granular, timely information about its expenditures across all programs and initiatives. This includes not just high-level budget categories, but specific contracts, grants, and other outlays.
2. Decision-making processes: There should be greater visibility into how spending and policy decisions are made within Treasury. This includes releasing more comprehensive minutes from key meetings and providing rationales for major financial moves.
3. Use of extraordinary measures: During debt ceiling crises, Treasury should offer real-time updates on its use of extraordinary measures to avoid default. This information is crucial for Congress and the public to understand the government’s true fiscal position.
4. Access to financial systems: Any non-Treasury personnel granted access to sensitive payment or financial systems should be publicly disclosed, along with a clear explanation of the scope and purpose of that access.
5. Data quality improvements: Treasury must address the data quality and reporting issues identified by the GAO regarding USAspending.gov. This includes ensuring all agencies are reporting completely and accurately, and making data limitation disclosures more prominent.
6. Audit trail for emergency spending: For crisis measures like COVID-19 relief programs, Treasury should maintain and publish a clear audit trail showing how funds were distributed and to whom.
7. Regulatory impact analyses: When proposing new financial regulations, Treasury should release more comprehensive analyses of the potential economic impacts and compliance costs.
8. Performance metrics: Treasury should establish and regularly report on clear performance metrics for its various programs and initiatives, allowing for better evaluation of their effectiveness.

Potential Objections and Counterarguments

Advocates for the status quo might raise several objections to calls for greater Treasury transparency:

1. National security concerns: Some might argue that too much transparency could compromise sensitive operations or provide adversaries with valuable intelligence.
2. Market stability: There may be fears that real-time disclosure of certain Treasury activities could lead to market volatility or speculation.
3. Negotiating power: Treasury officials might contend that full transparency would undermine their ability to negotiate effectively with foreign governments or financial institutions.
4. Administrative burden: Implementing more robust reporting and disclosure practices would require additional resources and could potentially slow down Treasury operations.
5. Misinterpretation of complex data: There may be concerns that releasing more detailed financial information to the public could lead to misunderstandings or out-of-context interpretations.

While these are valid considerations, they do not justify the current level of opacity. Many of these concerns can be addressed through careful implementation of transparency measures, including:

• Redacting truly sensitive national security information while still providing aggregate data
• Implementing appropriate time delays for market-sensitive disclosures
• Providing clear context and explanations alongside complex financial data
• Leveraging technology to automate and streamline reporting processes
• Engaging in proactive education and outreach to help the public understand Treasury data

The Benefits of a More Transparent Treasury

Enhancing Treasury’s transparency would yield numerous benefits for both the government and the public:

1. Improved accountability: Greater visibility into Treasury’s operations would allow for more effective oversight by Congress, watchdog groups, and the media.
2. Enhanced public trust: Openness and transparency are key to rebuilding trust in government institutions, which has eroded significantly in recent years.
3. Better policy outcomes: Access to more comprehensive data would enable researchers, policymakers, and citizens to better evaluate the effectiveness of various financial policies and programs.
4. Reduced waste and fraud: Sunlight is often the best disinfectant. Increased scrutiny of Treasury’s spending could help identify and eliminate inefficiencies and potential abuses.
5. More informed public debate: A clearer picture of government finances would elevate the quality of public discourse around fiscal policy, taxation, and economic issues.
6. Innovation opportunities: Making more Treasury data publicly available could spur private sector innovation in financial analysis, civic technology, and other fields.

Practicing What They Preach

The Treasury Department plays a pivotal role in managing the nation’s finances and shaping economic policy. Its decisions and actions have far-reaching consequences for every American. As such, it has a special obligation to operate with the highest levels of transparency and accountability.

The current contradiction between the government’s push for expansive financial surveillance of citizens and its own reluctance to provide basic spending transparency is untenable. It erodes public trust and undermines the principles of open, democratic governance.

If Treasury truly believes that those with nothing to hide have nothing to fear from financial scrutiny, then it must lead by example. The department should embrace a new era of radical transparency, providing unprecedented insight into its operations, decision-making processes, and expenditures.

This is not merely about abstract principles of good governance. In an age of mounting government debt, growing economic inequality, and eroding faith in institutions, we desperately need a Treasury Department that operates in the full light of day. Only then can we have the informed debate and effective oversight necessary to navigate the complex financial challenges of the 21st century.

The American people deserve nothing less than full transparency from the guardians of the public purse. It’s time for Treasury to practice what it preaches and open its books to the citizens it serves.