Everybody has a budget. Going red is just very bad. Sustainability is the keyword here.

A streetcar enhance economic activity and transportation, especially when built with proper urban planning, and may even make a profit.

With the profit, the public transit agency can use the fund to improve infrastructure with hopefully less political influence in order to further it missions.

You could of course make a trade off and not mandate the agency to be profitable and subsidize it, but it's a political tradeoff.

Just because a business turns a loss doesn't mean it isn't sustainable.

Public transport is unprofitable pretty much everywhere, because the explicit transactions don't offset costs of operation. However, the cost of not operating public transit is that you end up with awful car centric cities, more respiratory disease from increased traffic, lost efficiency from congestion, higher real estate prices in walkable areas, etc.

Additionally, there's a ton of positive externalities that are not factored in when judging profitability. Effective public transport increases foot traffic, which increases economic activity.

Even if public transit was 100% free, it would still be worth running. The market is awful at evaluating long-term large scale effects, and just disregards them as "externalities". You can't blindly trust markets to build your cities.

An even better one that's directly relevant is: How profitable are roads? Public roads are exclusively unprofitable and yet they get fully subsidised.