I think pretty much everything the government does should be contracted out. There is not much the government employees do that could not be done by contractors. It is much easier to terminate contractors that do not perform or are not needed anymore than it is to terminate government employees. As a bonus, we don’t have to pay them when they retire either.
When my father retired from the Navy in the mid 1980s, he went to work for a “Beltway bandit” defense contracting firm doing what he’d done for the Navy in his last years, nuclear weapons logistics. Every time a new contract was signed to manage the Sparrow missile program, the new contractor would hire the staff from the previous contractor.