I think the way China approached this is probably the better way -- heavily support companies in the commercial sector that can quickly iterate, invest heavily to improve the tech, and scale up manufacturing. They'll always have the latest and greatest since they need to be on the edge for consumer tech, and if a conflict begins they can just produce some extras or worst case shift all production to defense.
For the US, which has effectively zero consumer drone companies, we must massively subsidize defense-specific drone manufacturers to keep them up to date, build millions of basically useless military drones that quickly become outdated unless there's actual war, and fail to control our own supply chain in the event Chinese parts are cut off.
It doesn't say if a million drones are going to be purchased from a defense contractor. Hopefully it goes to a commerical US drone company that makes drones for consumers, film, inspections, etc with an order of million military-harden drones from the Goverment. There would an expection they could tool up to many millions in a time of conflict.
Defense contractors already cover small batches of super-specialized drones.
San Fran historically saw a ton of investment from the Navy, not the Army. The article provided -- which has wayyyy to many underlined links, hideous article -- only goes back to the ~60's, but the USN and USMC were heavily involved in Cali developments long before.
The general point -- the DoD puts a lot of money into Silicon Valley research -- stands, however.
This misses a very important point, which is that civilian manufacturing can be pivoted easily to defense manufacturing during wartime. Absent civilian manufacturing, you have no choice but to invest in dedicated defense manufacturing, which is not useful in peacetime (beyond deterrence).
The deindustrialization that creates this reality has nothing to do with the military-industrial complex. They benefit from it but they didn't create the context.
For the US, which has effectively zero consumer drone companies, we must massively subsidize defense-specific drone manufacturers to keep them up to date, build millions of basically useless military drones that quickly become outdated unless there's actual war, and fail to control our own supply chain in the event Chinese parts are cut off.