The missing part of the equation is successful businesses generate taxes, failing ones don't. So, as Tesla grows, it pays more taxes. That's how the government

The missing part of the equation is successful businesses generate taxes, failing ones don't. So, as Tesla grows, it pays more taxes. That's how the government will collect the upside. If Tesla doesn't do as well, the government will also collect the (deferred) upside through stocks. The only way the government can lose is if Tesla goes bankrupt. That way the government can make their profits on all the businesses that don't fail, rather than just 1-2 smashing successes. There's also the taxes the government collects through suppliers to Tesla, as well as sales taxes generated when consumers purchase electric vehicles, etc, taxes from capital gains and dividends of tesla stock, taxes from salary taxes. I'm simplifying here because I haven't talked about the opportunity cost of the taxes from a petrol car the consumer didn't buy or the other job employees could have held. In general, however, the government will profit as long as value of taxes from economic growth and other benefits exceed the cost of the loan. And remember, for the government, the cost of the loan isn't for taxpayers to bear, but for all holders of US dollars, which include foreign nations and other non-taxpayers, through temporary inflation; Since the government can always print money to lend, and destroy money when the money is repaid, unless the business fails, in which case every US dollar holding person suffers. Overdoing it, however, will mean displacing existing investors who are arguably better posed to select winners and negatively affect the economy. What I am saying is some level of government intervention may actually be profitable for taxpayers, even if the investment structure doesn't appear so on the surface. It's like the "Why do governments invest in loss-making airlines?" The answer of course is to bring more tourists to their country by undercharging plane tickets.