Ready for some (more) unfounded speculation?
Both people and organizations tend to want to keep their data within a circle of trust; it's why there has been (and continues to be) resistance to putting sensitive data in the cloud. It's a function of human nature to keep things close -- which is why people still keep files on their desktops or laptops, use USB drives, and run servers at home. You keep your treasures in an environment that you know best, and where you feel you have the most control over them.
According to the Washington Post, President Bill Clinton had had a personal email server at home; Hillary Clinton had a server which had been in use during her first presidential campaign in 2008, and this same server was then set up for her at home when she took the Secretary of State post.
Besides this controversy with her home email server
(and yes, I commented on that on CNN, but they must not have liked most
of what I had to say), I noticed the other day that apparently Caroline
Kennedy had been using personal email as well for State Department
business. This suggests to me that they may have had a reason in common
for doing this, one that hasn't been highlighted so far:
They both have a very different risk profile from most public officials.
When you're a celebrity -- independent of the position you currently hold -- your threat modeling has to include just about everyone. Any friends you have, any staff members you hire, could turn on you at any time for some perceived advantage. Now, Hillary could have had knowledge that the State Department was bad at securing its own systems, but I don't think that was it. I think she just couldn't trust staffers that worked for the agency and not for her personally. Any of them might try to access her email for political or personal reasons -- and let's face it: she's spent many, many years being embattled. The same would go for Caroline Kennedy, as well as anyone else who was famous before they took office.
In other words, their threat model holds colleagues to be a higher risk than hackers.
If you think this is surprising, you haven't been inside the minds of most non-security people. They have seen and experienced many more threats on a personal level than they have The Notorious A.P.T, so they will defend against the threat they believe in more.
None of us really knows how secure the server ended up being (although it looks like Hurricane Sandy caused natural disasters to become a more prominent part of the threat model, which is why they finally moved it to a provider with an actual data center), so I can't comment on that. Nor am I in any position to comment on the legal or classification issues, since those seem to be changing depending on who's got the microphone at any given time. But from a threat modeling perspective, I can absolutely understand why people want to hold their staff close and their data closer.
Oh, and by the way: if you can't view things from other peoples' perspectives, you're not going to be very good at threat modeling.