Not all developers are equal. Government work pays a third or less what private industry pays. You’re never going to get extreme competence from a government software employee.
Never? You don’t think NSA or Israeli 8200 has preeminent software developers? I think your assumption hinges on people being motivated solely by money. That may be largely generalizable, but I suspect there are relatively large exceptions to that rule.
I think they have the benefit of mystique. I don’t think you’d find their code quality any better than the average. I also think you’d find the same rush to market mania that plagues the rest of the software industry.
Not all competent people are driven by pay. I'd say the most competent usually are not. There are a lot easier and safer ways to get paid well than competence.