The Treasury doesn't want to face the risk of higher interest ra

The answer seems pretty obvious. The reason the Treasury has never relied exclusively on short-term borrowing, and the reason it wouldn't be willing to today either, is because if all its debt were short term and interest rates subsequently go up, the Treasury could be faced with a ballooning refinancing problem that could be very hard for it to fill. The Treasury doesn't want to face the risk of higher interest rates any more than private investors do. If the Treasury were more willing than private investors to absorb this risk, then yes, by doing so it might be able to lower long-term yields. But as a practical matter, the Treasury may be quite unwilling to absorb this extra risk.