There have been news of group of employees opposing this internally at Microsoft. Employees feel that they have been cheated/mis-guided my MS.
Dunno, I try to be sympathetic to concerns, but don't work for a business that is willing to do government contracts (or have the government as a customer, for that matter) if you don't want anything you work on to be used by the government.
Is this the work of some kind of extremist libertarian branch inside of Microsoft?
I don't know how you can work on a cloud provider ANYWHERE and not have this issue. I don't know how you can work on any open infrastructure, honestly.
There are worse actors than the government already in the cloud, if you ask me.