>For a short while, VC investments paid out as bonuses to the participants, and just the novelty of the thing might keep both sides happy. But eventually there has to be a balance found between "I want to pay less" and "I want to earn as much as before" and "government wants as much taxes as before".

Eventually, a "business" has to actually create value and earn a profit somehow. If VCs actually intend to support neat stuff on charity, they can just write checks to the National Science Foundation.