Comment by riskassessment

This isn't close to a monopsony but it's more directionally correct than it is wrong. Keep in mind research institutes can be funded by private foundations, state and local governments, industry (e.g. pharma), venture, or even foreign governments. The federal government is undoubtedly the largest buyer though. I do think there are other motivations to rely primarily on federal grants beyond number of dollars. In particular, funding sources other than federal grant money is often looked down on from an academic prestige perspective. Until now federal money came with very few strings attached compared to the perceived loss of objectivity that could occur when receiving money from other sources. The current situation may alter or relax the prevailing view on which sources of research money are perceived of as potentially compromising.