From a business perspective, it makes sense. I assume they're spending time on the security aspects. But a cloud-based datacenter managed by a 3rd party will no doubt be cheaper than one built and maintained by the government. The only problem is, if they change their mind in 5 years, good luck!
Like any other site, Amazon has its uses. I wouldn't say I'm an Amazon "hater" but I've had good and bad experiences with Amazon. One experience was handled right away and another took some time and was resolved eventually.