If it wasn't for censorship, democracy wouldn't have survived the 20th century. There are concrete, non-hypothetical secrets democratic states did keep during the 20th century which safeguarded their continued existence and the reestablishment of democracy throughout much of the world.
Everything you say can and has been applied to every power of the state--the power to make war, the power to collect taxes, the power to enforce law, you name it. Each of these powers has been abused. Each of these powers--including the power to keep secrets--needs to be restricted and kept in check, but not abolished. That way lies anarchy, a fundamentally untested system when applied conscientiously to a modern society and a violent nightmare when applied haphazardly anywhere we've observed it in settled societies.[1]
"A more open society is a more equal society, and where there are fewer power imbalances you will get fewer abuses of power. For sake of clarity, I am not including private information; medical records, etc, unless there is good justification."
Privacy and secrecy are two names for the same thing.
[1] Whether hunter-gatherer societies were fundamentally anarchic is an interesting but, in this context, irrelevant anthropological question.