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There are people who want to improve government with technology, just because it's an uphill battle doesn't mean it isn't worth doing.

Also, governments are big spenders. Plenty of incentive there.

The real motive is your latter point, to capture evergreen money through government spending. Trying to find opportunities to be the vendor of choice in new ways.

Hmm - I'd reread the RFS. YC is not interested in running the government.

I don't think this implies replacing government with private business. This could be services sold to government or tightening connections between government and the public. And don't just think of federal government. Local government frequently uses antiquated technology because better stuff is out of reach. How about helping small libraries organize their collections? Or fire departments manage procurement?

That "something" is varies widely by party.