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you. Edward Jones, member SIPC.

0:23

This is Planet Money

0:25

from NPR. This unfathomably large

0:28

hose through which hundreds of

0:30

millions of dollars flow every

0:32

single day. At least, that's how we

0:35

think of it. More officially, at

0:37

the treasury, it's known as the

0:39

secure payment system. The federal government

0:41

basically runs through that money

0:43

pipe. Almost 90% of all

0:45

federal payments flow through it.

0:48

Payments to Medicaid and Veterans

0:50

Affairs and Customs and Border

0:52

Protection. Payments to the Library

0:54

of Congress, the SEC, the

0:56

FCC, the FCIC, the FCIC,

0:58

the FCIC. That's the Federal

1:00

Crop Insurance Corporation. Congress allocates

1:02

trillions of dollars to go

1:04

to specific parts of the government,

1:06

and when those parts of the

1:08

government need a chunk of their

1:10

allowance, they request it. and Treasury

1:12

sends it through the old money

1:14

pipe. And then, a few weeks ago,

1:16

the pipe, what's the way to

1:18

put this? Got frozen, I guess,

1:21

partially frozen? The Trump administration

1:24

ordered a pause, a freeze on

1:26

a huge chunk of federal spending

1:28

on federal assistance, grants and loans

1:31

and subsidies, that kind of thing,

1:33

saying basically, do not request your

1:35

funds. All of those need to

1:38

be reviewed. Then the courts blocked

1:40

that freeze, but then, reportedly, some

1:43

parts of the government were still

1:45

not getting their money. Nobody seemed

1:47

to know what was happening.

1:49

And there have been enormous

1:52

consequences amid all this confusion.

1:54

Hundreds and hundreds of people

1:56

lost their jobs. Clinics and

1:58

daycares across the country. don't

2:00

know if they will have

2:02

money to operate. Retirees fretted

2:04

about getting their payments. But

2:06

the United States is a

2:08

country of transparency. And if you

2:11

know where to look, there is

2:13

a way to cut through all

2:15

the confusion and peer deep into

2:18

the giant money pipe for answers.

2:20

Hello and welcome to Planet Money,

2:22

I'm Erica Bares. And I'm Mary

2:24

Childs. Today on the show, we

2:26

go where to look, to that

2:28

one place with the tiniest bit

2:30

of information, of facts in this

2:32

chaotic stretch of federal action and

2:35

freezes and unfreezes. We get

2:37

a strikingly clear look inside the

2:39

big money pipe through which most

2:41

federal spending runs, and at some

2:44

of the people and the programs

2:46

on the other end of that

2:48

pipe. Plus, a tool you can

2:51

use right now if you want

2:53

to follow along at home as

2:55

this gigantic federal spending story continues

2:57

developing and developing. This

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Branch, terms and more at applecard.com.

3:51

at applecard.com. When everybody

3:53

was running around trying to figure

3:56

out what was happening with federal

3:58

government money, apparently folks at the

4:00

Brookings Institution, well, they were kind

4:03

of running around too. Did they stop certain

4:05

things? Did they restart things? It

4:07

just got very confusing, and we

4:09

didn't know what the answer was.

4:11

Lauren Bauer works for something called

4:13

the Hamilton Project within Brookings. They're

4:15

a nonpartisan group. They do policy

4:17

research. And you know, pretty tough

4:20

to do policy research when you

4:22

have no idea what is happening

4:24

with federal spending. But Lauren

4:27

remembered something. another chaotic moment

4:29

when she'd also wanted to

4:31

check government spending. And so I

4:34

had experience from COVID with

4:36

something that's called the Daily

4:38

Treasury Statement. The Daily Treasury

4:40

Statement, the DTS if you

4:43

want to sound really cool, is

4:45

just one of a gazillion documents

4:47

put out by the federal government.

4:50

In terms of popularity, it gets

4:52

googled way less than the harmonized

4:54

tariff schedule, but maybe slightly more

4:57

than the short-term cash investment report.

4:59

So you know, not popular. But

5:01

what the Daily Treasury statement

5:03

does is show how much

5:05

money flows through the giant

5:07

government money pipe every single

5:10

business day. And Lauren thought

5:12

the Daily Treasury statement might

5:14

be the key to... everything

5:16

to understanding this present moment

5:18

of spending freezes and unfreezes

5:20

and confusion. You can imagine

5:22

when there's this empirical

5:25

question, did the Trump administration

5:27

stop the flow of funds

5:29

that we had a resource here that

5:31

nobody really knew about? Can we look

5:34

at the thing together and you like

5:36

tell me about it? Sure. Let

5:38

me show you what the actual

5:40

website is. To be clear, the

5:42

Daily Treasury statement is not a

5:44

secret document. You don't need Treasury

5:46

clearance. You don't need to be

5:48

a researcher requesting special access. Real

5:50

Treasury heads? They'll probably know about

5:52

this PDF. But it is easily

5:54

overlooked. It's like the digital equivalent

5:56

of a piece of paper under

5:58

a giant stack of... papers on

6:00

your desk. Okay, great. So this

6:02

is fiscal data dot treasury.gov. Love

6:05

it, beautiful. And this is a

6:07

home page for you, basically. This

6:09

is like a commonly visited site.

6:11

Yeah. It is. So what you see here,

6:13

so if you click it, it opens. Look,

6:15

I've already done it once today.

6:18

You can get the Daily Treasury

6:20

statement. And that's it. You click it.

6:23

download. It's a PDF. It's

6:25

like 80 kilobytes, not even

6:28

close to a full megabyte.

6:30

There's a new one every

6:33

business day at 4 p.m.

6:35

So we opened it up

6:38

together and there's a very

6:40

fancy official-looking treasury insignia at

6:43

the top? And it shows

6:45

the cash balance of the

6:47

US's like a two-column

6:49

ledger. And on the left-hand

6:51

side is the deposits. So

6:53

like when you pay taxes

6:55

into the treasury, your taxes

6:58

get totaled on that day

7:00

into an incoming line item.

7:02

But what is important for

7:04

this moment is the withdrawals.

7:06

And so... It varies in

7:08

level of detail, but we

7:10

have on the withdrawal side,

7:13

all of the outlays that

7:15

Treasury is making to departments,

7:17

to the other branches of

7:19

government, to programs. Imagine it

7:21

like a daily Venmo feed

7:24

for the government. $191 million

7:26

to NASA? Rock-a-chip emoji.

7:29

$249 million to the

7:31

Department of Agriculture. I don't

7:33

know, cow, pig, corn, corn, corn,

7:35

corn. Every dollar rounded to the

7:38

million dollar that comes out of

7:40

the government's checking account posted at

7:42

4 p.m. in this Daily Treasury

7:44

statement. Now, it is not an

7:46

accident that this document exists. This

7:48

beautiful, awkwardly hyperlinked, Daily

7:51

Treasury PDF. The United States

7:53

government is of course a

7:55

prodigious generator of paperwork. And

7:58

decades ago, lawmakers realized... they'd

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spectrum.com slash business. That

20:59

would not be ideal. Now, of

21:01

course, it's not like there's some

21:03

line item saying Steve's grant. This

21:05

is just showing when the money

21:07

is flowing or not flowing out

21:09

of NSF. Is the line going

21:12

up or down or just laying

21:14

there flat at zero? But yeah,

21:16

Steve says, if this is the

21:18

best we got, more than nothing

21:20

is better than nothing. Especially in

21:22

an age when, yeah, there is

21:24

a lot of misinformation around. You

21:26

know, it's nice to have an

21:28

actual source that shows you the

21:31

numbers, yeah. Even though the money

21:33

seems to be flowing to NSF,

21:35

Steve hasn't hired his summer student,

21:37

he'll spend the money if and

21:39

when it shows up. Okay. Our

21:41

third and final use case is

21:43

what we might call, is there

21:45

a reason to be worried about

21:47

a gigantic mistake that might affect

21:49

one of the most important financial

21:52

instruments in the American and also

21:54

global economy case? Yeah, so some

21:56

background on this one. A concern

21:58

that has developed over the last

22:00

couple of weeks has to do

22:02

with access to the giant money

22:04

pipe. Late last month, Elon Musk's

22:06

doze team was granted access to

22:08

federal payment systems as part of

22:11

what they say is an effort

22:13

to suggest cuts to wasteful spending.

22:15

There has been reporting that this

22:17

team has a kind of access

22:19

that would allow them to change

22:21

computer code in the federal payment

22:23

systems. Treasury initially denied this claim,

22:25

but then they were like, oh,

22:27

yes, whoops, that was true, just

22:30

for one person, but not anymore.

22:32

But nonetheless, if someone makes the

22:34

wrong changes to the giant money

22:36

pipe, it might could... cause seismic

22:38

problems. Notably to the famously reliable

22:40

drip of interest paid on U.S.

22:42

government debt. Treasuries. And so for

22:44

our final stop, we called up

22:46

someone who was expecting lots of

22:49

these regular interest payments. His name

22:51

is Guilaba. He lives in Philadelphia.

22:53

The Eagles had just won the

22:55

Super Bowl. Go Birds. Gui volunteered

22:57

that he did not climb any

22:59

lamp posts to celebrate. I didn't.

23:01

I'm going to leave that to

23:03

the 20-somethings. Okay, so you're doing

23:05

that risk-reward analysis and you're like,

23:08

it's not for me. Yeah, I

23:10

mean, I am a fixed-income portfolio

23:12

manager, so we're not usually the

23:14

most exciting types in the world.

23:16

He buys and owns bonds professionally

23:18

for clients, and once a month

23:20

on the 15th, he gets interest

23:22

payments of millions of dollars on

23:24

US treasuries. How do you know

23:26

when you've gotten an interest payment

23:29

payment into your portfolio? it arriving?

23:31

Well that's a really interesting question.

23:33

You know we do track interest

23:35

payments for riskier bonds but our

23:37

systems are all built around assuming

23:39

that payments just come in when

23:41

it comes to treasuries. And the

23:43

line item on interest paid on

23:45

treasury securities securities is my personal

23:48

favorite thing to look at on

23:50

the money pipe tracker. So we

23:52

pull it up together. Here we

23:54

go. I'm about to dig around

23:56

a little bit but it seems

23:58

like a cleverly programmed widget. What

24:00

this graph looks like is just

24:02

these massive steadfast steady spikes. They

24:04

represent... the quarterly big interest payments

24:07

the Treasury Department makes. And they

24:09

cover payment on trillions of dollars

24:11

of outstanding securities that are used

24:13

across the global financial system. Treasury

24:15

is seen as the safest investment

24:17

in the world. The US has

24:19

never missed a payment in modern

24:21

history. Well, except for the one

24:23

time in 1979 when we were

24:26

accidentally a little late, one study

24:28

found that just that tiny bit

24:30

of uncertainty wound up costing the

24:32

US government like $12 billion just

24:34

for that tiny risk premium. But

24:36

other than that, so reliable. And

24:38

Guy admits if the US truly

24:40

truly truly missed a payment, it

24:42

would probably ruin his day. That

24:45

day would look like lighting my

24:47

hair on fire and running around

24:49

in circles for the most part.

24:51

Yeah. Not ideal. Not what we

24:53

want, Frinky. But if you are

24:55

worried about that, you can pull

24:57

up the old money pipe monitor

24:59

widget tracker thing and look for

25:01

that reassuring spike, spike, spike. So

25:03

a very large problem would show

25:06

up on the CKG. A very

25:08

large problem, meaning a missed interest

25:10

payment on billions and billions and

25:12

billions of securities. I find that

25:14

scenario among the least likely. And

25:16

hopefully I still have that opinion

25:18

three months from now. So, meaning

25:20

you don't think that they will

25:22

miss a payment? I really do

25:25

not expect the Treasury Department to

25:27

miss a payment. So, third and

25:29

final use case, watching Treasury interest

25:31

payments, if that's what helps you

25:33

sleep at night, does for me.

25:35

Lauren Bauer from Brookings Institution has

25:37

been frantically trying to keep track

25:39

of who is using this and...

25:41

for what? It is still a

25:44

work in progress and Lauren apparently

25:46

is also open to ideas. Now

25:48

do you have a mechanism for

25:50

if a line item disappears? That's

25:52

a really good question. I'm going

25:54

to write that down as a

25:56

thing we should do. Good

26:00

job. Thank you. It would

26:02

be hard to find someone

26:04

who loves the Daily Treasury

26:06

statement more than Lauren Bauer,

26:08

and she is delighted to

26:10

be elevating the plucky little

26:13

PDF, getting it more and

26:15

more attention. But with some

26:17

government websites flickering on and

26:19

off, and with some public

26:21

information getting pulled down, we

26:23

asked her, is it possible

26:25

to draw too much attention

26:27

to our precious Daily Treasury

26:29

statement? Lauren says, no. if

26:31

that little PDF disappeared for

26:34

some reason, she thinks that

26:36

would attract even more attention

26:38

to it. I am not

26:40

worried if someone pulls my

26:42

access to this, because if

26:44

they do, then that is

26:46

actually a paradigm shift of

26:48

lights out into the public's

26:50

insight into how much money

26:53

the treasury has and where

26:55

it's coming in and where

26:57

it's going. And so I

26:59

actually feel quite proud that

27:01

we've pulled something. that I

27:03

dare you to remove the

27:05

public's access to the federal

27:07

government's balance sheet. Do you

27:09

double-dog, dare? Not really. If

27:11

you would like to follow

27:14

the giant money pipe for

27:16

yourself, you can find that

27:18

at the Hamilton Projects website.

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