Th best folks I know wouldn't touch a government job, no matter the pay.

There was a period of time where it seemed (as an outsider) that they were attracting good talent. This was when Megan Smith was CTO. https://en.wikipedia.org/wiki/Megan_Smith.

Dont they usually bargain work against jailtime for domestic cyber criminals?

I applied to USDS in 2023, the process took nearly a year and ended with them just ghosting me after two interview rounds. Pay was capped (by law) below my target salary but at a level that I would accept as it would have been fully remote, but there was also a term limit on the job which meant I would have at most two years in the position.

It’s not just the pay, there’s a lot of structural elements that mean that the potential talent pool is less than desired.