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(Forgot to respond to part about a government organization to get secure products out. Here's response to that.)

It's been done before. It was the Walker Security Initiative. It resulted in some of the most secure products the market ever produced. A combination of lobbying for insecure products to be bought and NSA's actions destroyed what little there was to the market. Bell describes it:

http://lukemuehlhauser.com/wp-content/uploads/Bell-Looking-B...

Just found a link with examples of what they were doing. I haven't read this one fully, though. Linking it mainly because it talks about CSI and how market was responding.

https://csrc.nist.gov/csrc/media/publications/conference-pap...

Here's some of the designs that came out of commercial sector of high-assurance security:

http://www.cse.psu.edu/~trj1/cse443-s12/docs/ch6.pdf

http://lukemuehlhauser.com/wp-content/uploads/Karger-et-al-A...

https://cryptosmith.com/mls/lock/

https://www.researchgate.net/publication/3504794_The_Army_Se...

http://cap-lore.com/CapTheory/upenn/

Note: I don't think KeyKOS itself came from that community. It was from capability-security field. KeySAFE extension was driven by TCSEC requirements, though.

http://webapp1.dlib.indiana.edu/virtual_disk_library/index.c...

Note: Although not first attempt, Trusted Xenix was first attempt at securing UNIX that made it to market. Available from 1990-1994 I think. Coincidentally, OpenBSD starts in 1994 to go even further.



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