> “revealing that the government is doing bad things reflects badly on the government and damages its reputation at home and abroad.”

This is -incidentally- how the ancient English "state secrets privilege" got introduced into US law.

In the 1940's, godawful maintenance resulted in the crash of a bomber over US soil and the death of all three of the civilians on board the plane. The widows of the dead civilians sued the government and demanded the accident report. The government refused to provide the report, claiming the privilege because "national security", and courts all the way up to the Supreme Court agreed.

In the early 2000s, the accident report was declassified. Inspection revealed that the only real reason to refuse to release it was to both prevent government embarrassment and to avoid having to pay out -IIRC- nearly a quarter million in 1940's USD to the widows.

Given its enormous potential for unchecked abuse, along with the fact that the first ever invocation of it was abusive, courts should refuse to permit its use.