The trope about the benefit of "Telling truth to power is mostly" is mostly B.S.: DC edition
The West Wing TV show had an episode I saw about the importance of staffers "telling truth to power." I've never found it pays off work-wise.
Former DC Insurance Commissioner William P. White would probably say the same thing. He was fired one day after ("DC insurance commissioner fired a day after questioning Obamacare fix," Post) stating publicly that a work-around on one element of the Affordable Care Act announced by President Obama wouldn't work well for DC, which has a successful state-level health care exchange.
The Washington Post editorializes today, "Mayor Gray delivers a chilling message to D.C. officials," that this isn't a good way to manage your employees.
2. Last year, Mayor Gray fired the director of the Department of Environment for discussing with the EPA his disagreement with the Executive Branch's change in approach to dealing with EPA regulatory requirements over separating sewerage infrastructure from stormwater run off infrastructure ("Christophe Tulou fired as D.C. environment director," Washington Business Journal).
3. And there has been a lot of discussion lately in the press (e.g., "On the path to a failed presidency?," Post) about how the Obama Administration isn't very good at listening to underlings who are trying to communicate "bad news."
4. I will say that the biggest lesson I got from my brief sojourn working for the executive branch in the Office of Planning for Baltimore County, Maryland is a substantive, real, and deep understanding of how the shots are called within the executive branch.
The chief executive and there, really, the long time chief budget officer was more powerful than the County Executive, who is limited to two terms, and his office call the shots on policy. They hire agency directors who understand this, and are willing to work within the parameters and constraints that are handed down to them.
Lowly staffers like me really didn't make policy. (In fact, I worry a bit that my getting the agency director so worked up about transportation planning responsibilities coming back to the OP that he broached this with the Executive ended up getting him canned when a new administration took office. Although I am sure that because of his progressive talk--not walk--he wasn't gonna be retained in any case.)
I had a couple of instances of citizens lecturing me about the value of sustainable transportation, and I would stop them, stating that their message would have a lot more impact and carry more weight when presented to their elected officials--I wasn't the person in the way of better sustainable transportation best practice, it was the DPW...
Were I able to have worked there long term (I don't know if it was possible, even if the County budget hadn't gone in the tank, despite what I was told), it would have been difficult to deal with this reality.
5. What happens is that people who won't tell bad news, or hide it, knowing the reaction it will evince end up getting fired anyway, when s**t hits the fan, e.g., failures in administrators in not being able to carry out the promises made by the Mayor in the face of inadequate systems e.g., "District officials criticize Fenty's management of summer jobs program."
Mayor Fenty made unfulfillable promises, his staff likely didn't tell me to cool down the statements, and when they couldn't fulfill the expectations, they lost their jobs.
Also see the book Exit, Voice and Loyalty by Albert O. Hirschman. The end of this essay by Malcolm Gladwell, "The Gift of Doubt," discusses that book.
I look at the argument a bit differently. Loyalty is for the people who stay but don't say anything. That's never worked well for me either.