I've been working for a long time in a highly political private company. I'm extremely lucky that I've been allowed to advance in my career on a technical track, but most people foolishly pick the management path. The actual work we do is really interesting and it's a fun job as long as you don't let the politics get to you, or heaven forbid, get involved in it. If you let it get to you, you're going to be miserable. If you do your work and don't step on any landmines, you're golden. It's not government IT, but the politics are very close -- think appointed VPs who can do no wrong, and whose appointments are basically gifts.
Most of my horror show IT boss stories revolve around people promoted into management positions who have no aptitude for it. I've held supervisory and management positions, and I can tell you first-hand that tech and management are completely orthogonal skill sets. I'm not sure what's different about IT, but it seems like there's just no easy way to retrain people to deal primarily with machines instead of people. Unfortunately, most organizations are built around the assumptions that the only way to advance in your career is to manage those doing actual work, and that everyone actually wants to climb the ladder. I was smart enough to realize that I wouldn't be effective no matter how much retraining I did, and luckily the company was interested in keeping someone with good technical skills as a "lead" without the political crap. I actually think it's for the best, because the company just went through its once-a-decade middle management clean-out. Moral of the story: If you want a job, keep your skills sharp and keep learning.
The other stories involve "white knight" MBAs coming in and managing departments through Excel. I worked at one place where the new CIO came in, and within 2 weeks announced that the entire department was being outsourced after a 6 month transition period. His speech basically amounted to "you're too expensive, capex vs. opex, right-sizing,..." The instant the meeting was over, every single person worth hiring was on the phone pulling the emergency cord, arranging new jobs and quitting (including me...I wasn't going to end up with the Scarlet Letter U (for Unemployed) on my record.) Instant dead-sea effect...the outsourcer ended up sucking at their job, got kicked out and the department was in-house again. Luckily the CIO got fired...that akways drives me nuts when executives keep messing up and end up at another company after getting a huge payout. Why can't we worker bees do that?