From my personal experience, this is not far from the truth.
Just speaking from an IT perspective, they love to hire contractors or to outsource projects to vendors for which they pay way to much for both and select on average (not all the time, just most time) people/vendors who over promise and under deliver and basically can't do the work.
This is made worst by the management not really knowing what they are managing or really 'caring'. They like to 'outsource' so if it goes bad, they blame the vendor, if it goes well, they take the credit.
A few examples, I got a quote for hardware, it was a rip off. I demanded a requote without all the crap I didn't need (support etc) and this dropped the price by 40%. The director got annoyed with me and said 'just pay it, if we run out of money for the project, the government will just give us more money'. Woah! What made it worst was I later found out she used to go drinking with the sales manager from the company I got the quote from.
One more for the road, I was invited to a large infrastructure kickoff. I went to the meeting and basically told them that what they wanted to do would not work the way they were going to try and do it. This caused all kinds of emotional responses. Essentially, I didn't get invited to any more of the meetings. 9 months later, the same project manager who kicked me out of the project turned up to the desk and demanded to know what I did to make sure the project didn't work. I re-explained that what they wanted to do was never going to work so he dragged me into a conference call with the vendor. Long story short, I got the call escalated from the first level tech through to senior level management who when challenged after their little spiel, paused and replied, 'yes, it will not work for the exact reasons you mentioned.' The look on the PM's face was priceless but I still got stuck cleaning up the mess.
That was the proverbial straw and I got out of government paid work not long after that last one.