We didn't get a chance to really talk about the barriers to using open source in government at our panel, so I decided at least, I'd post them here for anyone who's interested.  Broadly, they fall into (1) technical issues, (2) perception issues, and (3) cultural issues.  Of the three, the last is the most difficult to overcome.  Here are some specifics:

1. Sales droids.  I could spend all day every day talking to salespeople from one company or another.  Some of them are quite useful to me from an educational standpoint and some of them aren't.  They all want to be my partner, but being a "partner" with your local sales rep is the way CIO's lose there jobs or, worse, go to jail.  But the point is, there are no open source salespeople.  They don't come knocking on the doors of the many people in my organization the way the salespeople from IBM, Oracle, Sun, and on and on and on do.  Thus, unless you're really trying, open source is not top of mind.
2. Consultants. Governments don't, as a rule, develop software.  They hire consultants to develop software.  Consultants don't make money selling me open source solutions.  They make money reselling me software and then customizing it.  So, if you want open source in government, you've got to penetrate the consultant camp. 
3. No OS culture.  As an example, there is at least one IT person in the state who started working for the state of Utah before I was born (and I'm not that young).  There are many more like him with almost the same tenure.  These people are smart and know their stuff.  May of them started out in mainframes and have made the jump to UNIX or something else.  Still, their mindset is to buy from the vendors they know---not go out on google or freshmeat and search for some open source software. 
4. Risk.  As an example, consider StarOffice.   I've been a StarOffice user for quite a while.  Still, I have to admit its a chore sometimes.  And even if I factor out the parts of the chore that would go away if all my co-workers used StarOffice, its got some bumps.  Changing a software product like the office suite causes lots of grief no matter what.  Using something like StarOffice though would likely unleash a hailstorm of blame on the decision to use something that wasn't mainstream.  No one's going to fire me or anyone else for using Office.  You can only fight so many battles and I've fought my share. 
5. IT Lobbying (or the lack thereof).  I did mention this one in the panel session.  The fact is, that IT companies as a whole are very naive when it comes to government.  They are not present in proportion to the size of the industry---not even close.  Like it or not, lobbyists serve an important educational role in government.  Legislators identify issues that are worth their time, in some cases, by lobbying action.  They learn the issues and decide to explore further.  Without this, they're unlikely to spend a lot of time.  We will lose every single important congressional and legislative battle unless the IT industry wakes up and recognizes this fact. 

I did get in a few licks for my Principals for Enabling Web Services, which I view as an important mandate for making government system interoperate and making the open, if not built on open source.  The fact is that the best tools for building open system are open source.   I made mention of the article in the Circuits section of the NY Times yesterday on privacy.  This section is particularly interesting and apropos:

Waqaas Fahmawi, 25, used to sign petitions freely when he was in college. "In the past you would physically sign a petition and could confidently know that it would disappear into oblivion," said Mr. Fahmawi, a Palestinian-American who works as an economist for the Commerce Department.

But after he discovered that his signatures from his college years had been archived on the Internet, he became reluctant to sign petitions for fear that potential employers would hold his political views again him.

He feels stifled in his political expression. "The fact I have to think about this," he said, "really does show we live in a system of thought control."

Our government is based on open records.  If these petitions aren't public, how could government work?  This is the very thing that should be public.  I'm afraid that just because someone has the expectation of privacy, we'll have to give it to them whether its right or not.   Freedom of expression is NOT the same as freedom from consequences of that expression.