Trump, Musk could put U.S. at default risk: former Treasury chiefs

Five former Treasury secretaries warned Monday that recent actions at the Treasury Department by Trump administration officials and Elon Musk‘s DOGE team raise “substantial cause for concern” that the United States’ financial commitments are being “unlawfully” undermined.

“We have during our service in the Treasury Department faced moments of crisis, when the specter of an American default loomed,” the former secretaries wrote in a New York Times op-ed.

“Any hint of the selective suspension of congressionally authorized payments will be a breach of trust and ultimately, a form of default. And our credibility, once lost, will prove difficult to regain,” they wrote.

“No Treasury secretary in his or her first weeks in office should be put in the position where it is necessary to reassure the nation and the world of the integrity of our payments system or our commitment to make good on our financial obligations.”

But Kevin Hassett, a top economic advisor to President Donald Trump, dismissed the former secretaries’ concerns during an interview on CNBC’s “Squawk Box.”

Treasury Secretary Scott Bessent, he said, “has found that controls for spending of the previous [Biden] administration were unacceptable. They were sending money out without knowing where the money was going.”

Hassett also said idea that Musk was acting as, in his words, “a puppet master” at the Treasury Department was “poppycock.”

“Elon Musk is in the office next to me,” Hassett said. “He’s not in control.”

The ex-secretaries who wrote the op-ed were Robert Rubin, Lawrence Summers, Timothy Geithner, Jacob Lew and Janet Yellen, all of whom served under Democratic presidents: Bill Clinton, Barack Obama and Joe Biden.

The dueling narratives come amid escalating legal battles over access to the Treasury Department’s highly sensitive payment systems, which members of Musk’s Department of Government Efficiency team have sought and been granted.

As DOGE and other elements of the Trump administration move to slash federal spending and employee headcount, the government’s payment disbursement system, run by the Treasury’s Fiscal Service, has drawn their attention.

Their op-ed cites reporting last week by The Times that the Treasury Department’s chief of staff originally pushed for a member of Musk’s DOGE team, Tom Krause, “to receive access to the closely held payment system so that the Treasury could freeze disbursements to the U.S. Agency for International Development.”

Emails seen by the Times “undercut Treasury’s explanation” for why Krause and other members of Musk’s team were granted access to the payments system, which disburses more than $5 trillion in federal funding, the newspaper noted.

The Treasury Department has said Krause and his team “are conducting an ‘operational efficiency assessment’ that does not involve blocking agency payments,” the Times reported.

In their op-ed, the former secretaries said the access “upended” the long-standing practice of payment systems operated by a “very small group of nonpartisan career civil servants.”

“The roles of these nonpartisan officials have been compromised by political actors from the so-called Department of Government Efficiency,” the op-ed said.

“We take the extraordinary step of writing this piece because we are alarmed about the risks of arbitrary and capricious political control of federal payments, which would be unlawful and corrosive to our democracy,” the former secretaries wrote.

Hassett, who leads the National Economic Council, argued strenuously against the op-ed’s premise and claims Monday.

“Can we talk about the Treasury letter first?” Hassett asked the “Squawk Box” hosts. “There’s so much misinformation in it.”

Hassett continued, “Let’s just make it clear the Treasury secretary, Scott Bessent, is in charge of the Treasury.”

Bessent, said Hassett, “has found that controls for spending of the previous [Biden] administration were unacceptable.”

“They were sending money out without knowing where the money was going. They were sending money out without flagging, you know, ‘what it was for?’ They didn’t check before they sent the money out, whether it was appropriated,” Hassett said. “And as we go in and look, we’re finding lots of things that shouldn’t have been sent.”

Hassett said, “There’s a lot of work to be done to clear that up.”

“This idea that there’s a puppet master telling the Treasury secretary what to do, and therefore all the Treasury secretaries need to be, like, alarmed, that’s just left-wing media, you know, poppycock.”

“Why are we making up fake things about what Elon is doing, because we’re trying to just see where the money’s going,” Hassett said.

“And I think it’s probably, in the end, we’re going to find that a lot of money went to bad places.”