If your hosting provider makes similar privacy guarantees to a similar VPN provider, then perhaps. For bonus points, use a hosted VM and commercial VPN in serial.

Again though, if the US Government is a potential adversary, there's still risk here. Intelligence services could have a 0-day on your linux distro, or an operative within the hosting company. If they get access, they can turn your hosted VM against you.

I think you just have to assume there's a possibility that the infrastracture can be compromised at any moment. For both of these two options. Guarantees from providers are valid until the day they are not.

Though a point has to be made about using a hosted VM for VPN purposes, you have some level of control about which specific software, configuration and encryption schemes etc. you want to use for your stack. Only downside is that currently there isn't sufficient hypervisor protection from the host kernel afaik.

However I do agree with you that either way, the risk threshold is too high if you are concerned about high level state actors. Neither commercial VPNs nor hosting providers can solve the "anonymity" problem for you.