But the US military wanted high capacity...and that meant a 9mm.
That's not quite right. The US military was
required to adopt the 9mm, and since it was going to be a 9mm no matter what, they decided they wanted a high capacity pistol.
And it's hard to say that the decision was political when Beretta had to actually build a factory here to win the contract.
I can't say just what, if any politics was involved in the choice of the 92, but I can tell you Beretta had no choice
but to build a factory in the US, if they wanted a shot at the contract.
The US is still one of the nations that requires our military arms to be made at home, "made in the USA". Actually, the arms for testing can be made anywhere, but the winner has to make the production guns in the USA. And, while I don't recall exactly, I wouldn't be surprised to learn that there is a time limit between winning the contract, and providing the production guns to the military.
IF so, waiting to build a factory in the US until after you win the contract might mean delays, which might mean loss of the contract, or at the least some kind of penalties. Even though it's a gamble, putting up a factory here before you win means IF you win, you will get to keep the contract.
And there is more than just the money for the contract involved. Think of the loss of prestige a major arms maker would suffer if they won a US military contract, and then could not meet the terms, and on time, simply because they "cheaped out". That loss of face could (and likely would) affect all their sales, military and civilian, worldwide. And that, is BIG money.