Contractors (and federal agencies too, to a large extent) have long since learned that the best way to get a big contract from the US government is to spread yourself out as much as you can, over as many districts as possible, in order to maximize your political pull.
Look at the supply chains of companies like Boeing, or defense contractors, and you'll see they have this down to an art.
This then leads to more and more entrenchment - there's less funding for truly innovative research because so much gets locked into those awful projects that are sacred cows and absolutely impossible to touch.
I don't really have a good solution. I strongly believe in federally funded research. Maybe something like the base closing commission should oversee all federal contracts?