And if you believed in your code enough to want to go through that
for one project - in groups that create lots of little scripts and
pieces of software that could be considered individual projects, it
would take up a fair amount of time writing up the paperwork and
justifications. Enough that you'd likely soon be doing more
paperwork than code, which kind of defeats the whole purpose in the
first place.

Got the above quote forwarded to me, the source apparently an academic listserv where the possibility of open-sourcing faculty code was raised.

Look, let's cut to the chase. The LGPL is a perfect license for all academic work, and I can't think of any good reason to use one that's any less open. MIT, Berkeley, etc. all seem like good substitutes. (GPL is not a good fit, I don't believe, if only for the sorts of negative connotations the project members could develop for open source once they figured out what GPL really means. If the university and its partner(s) were fully aware of what GPL means going in, or the university instated a generic GPL exemption for faculty as an alternative to automatic university copyright, however, I'd be all for it.)

Any sort of closed partnership between a publicly funded institution and a corporate interest is inappropriate, and this is luckily still largely the conventional wisdom in the subset of publicly funded institutions which includes universities. The LGPL allows a corporation to freely continue work enabled by their partnered research without being forced to hand over one iota of their later, independent work -- work they later, independently complete from the end of the project until the end of time. Flip side, the LGPL ensures that everyone has equal and open access to the fruits of each partnership's labours, at least from the project's code's point of view (social connections are a little more difficult to manage). Ensuring code-specific fruits are accessible to all is a good place to start.

But what if we're talking issues of national security, like nuclear testing? Makes me being to wonder if public universities should be contributing directly to those issues, honestly.

Look, if universities are going force their faculty to enter into contracts stating that research for their personal, monetary gain is against the spirit or mission of that institution, the university better dammed well follow suit. Otherwise, the university (and other incorporated entities) are becoming the backbone of a [not so] new [but growing], increasingly sinister sort of bourgeoise.