There are other things to train people for than IT. Many times, but not always, knowing how to conduct training is as inportant as knowing the material. For the material you can get Subject Matter Experts(SMEs). My Division of my company does a lot of training stuff for the military. We don't (usually) conduct the training, but we generate the materials, everything from paper course materials such as student and instructor guides, to interactive courseware, to Web based training. The part I work in builds hardware/software simulator systems used to conduct training. Some virtual reality stuff, some "emulators" and some more basic stuff too. We have very few SME's depending on the customer to provide those. Although in some sense, I'm one of those few, depending on the system being considered.
This is exactly the kind of stuff that you can get done in India for 75% less! Your management must be nuts to do this in the United States!
But since it is for the military, I guess it is the taxpayer who is getting screwed.