Then you'll find that in many cases, these "real costs" are too high for many who need it, leading many low margin services to stop being offered and many consumers turned away. Hardly a win.

Complex subsidies can broaden the market and serve the underserved, that's a win. It's classic engineering arrogance to dismiss all complexity as unnecessary or harmful, as if the economy is a passion project that should not deign to serve those who can't or won't bear the full cost of each individual product.

If there is margin on the service, it isn't really a subsidy, it's capacity utilization (building a hospital that can do 100 surgeries a year instead of a hospital that can do 45 knee surgeries a year and filling the slots with other services).

I guess you can probably re-frame your argument using some other similar measure though.