As you have pointed out, public subsidies are already the main financing source for public utilities. If you're worried about bankruptcy, you may be worried tha

As you have pointed out, public subsidies are already the main financing source for public utilities. If you're worried about bankruptcy, you may be worried that ticketing/controlling equipment and personnel has a substantial cost for transportation agencies (also: environmental cost). French law already has obligation for your employer to pay (at least parts of) your travel fees. You could also have a tax on hotel rooms and airbnbs for tourists to help finance it. There's already cities across the globe practicing free public transport and so far i haven't heard any complaining or finding unexpected difficulties. Also, specifically about quality of service, we could argue having a service orientation driven by workers and users (a sort of coop if you like) would yield better results than what David Graeber refers to as "manageurial feudalism" sucking public services dry through dehumanizing micromanagement techniques, absurd salaries for the higher-ups, and various forms of corruption such as "private-public partnerships".