The vendors may be horrible, but it's still on the shoulders of the city for choosing the vendors. This is really down to the fact that most decision makers have no idea how to understand or differentiate between options. It's been like this for decades. When a secretary of state doesn't know the risks in running a private independent email server and how to ensure those risks don't become issues, how do expect much lower level city governments to make any better decisions. Honestly, the IT workers are often underappreciated, underpaid, and underskilled. I usually don't blame the IT people. If they could work at FANG, they would. If they get into a rut where they end up not caring anymore, it sucks. But let's put blame where it belongs, it's on leadership to develop a culture where people care and on leadership to invest money and resources accordingly.
Edit: though I shall add that it unfortunately is sometimes not possible to build a new culture without firing incumbents. That one is a really unfortunate situation. It's not the fault of low-skilled IT workers if they are enabled and rewarded for poor skills and attitudes. But if an organization wants to make good cultures, it sometimes requires hard decisions. Still don't blame the workers, just like I don't blame factory workers that get automated. It's just an unfortunate thing that can happen that most people don't deserve.
I don't think it's good enough to say « it's still on the shoulders of the city for choosing the vendors ».
If I write a piece of software which is technically capable of meeting its requirements if you read the manual carefully enough, but in practice the intended users can't figure out how to do so, that piece of software is no good.
Similarly if the market is in principle providing IT vendors who are capable of providing a decent service, but in practice the purchasers can't figure out which ones they are or how to make them do so, the market has failed.
Do you have a viable method to fix the problems you describe? If not, then we're still left with it being on the shoulders of the city. Ultimately, it's really hard to police that the vendors don't make crap solutions. If the market fails to figure out which are crap, the market may have failed, but I don't have any ideas that would succeed better.
Edit: and let me say that I posited that the issue isn't market forces. The issue is lack of expertise at decision making levels. Even if there were zero market, it wouldn't stop people from doing it wrong.
Principally: start punishing the corrupt vendors; don't assume that reputation mechanisms will ensure that non-corrupt ones will eventually outcompete the corrupt ones.
Just as you have to build software for the users you have not the users you feel you deserve, we need a service industry that works for the service-commissioning agents we have.
Again... how would you do it though? Who would do the punishing? How would you enforce the punishment? Would clients build the punishment into the contract? Even if you could do that, the vendors have the advantage of how to construct the contract in their best interests and avoid punishment. Most ideas will go straight back to market forces. Again, the issue is expertise to choose good options, not the existence of market forces.
Edit: though I shall add that it unfortunately is sometimes not possible to build a new culture without firing incumbents. That one is a really unfortunate situation. It's not the fault of low-skilled IT workers if they are enabled and rewarded for poor skills and attitudes. But if an organization wants to make good cultures, it sometimes requires hard decisions. Still don't blame the workers, just like I don't blame factory workers that get automated. It's just an unfortunate thing that can happen that most people don't deserve.