Because "government research" doesn't cover mass production and all of the supply chain management. Which is where anything bureaucratic really sucks.
(Unless you need to build things badly, but fast and on large scale, mobilization-style - see Khruschev-era mass construction in ex-USSR, or, for exotic stuff, older state-built housing in Israel which isn't that much better).
Actual production rots very quickly, if centralized and bureaucratic.
I agree that research requires long-term investment and is in general a completely different thing.