For example, just enabling additional supply can create second order effects in terms of perverse incentives to overproduce creating all sorts of knock-on effects. We can stimulate the supply of corn and end up with distorted food markets and high-fructose corn syrup as a near-ubiquitous food additive. All I’m saying is we need to be mindful of these systemic effects and creating a false dichotomy tends to turn a blind eye towards them.
Any mechanism with the explicit intent to increase supply is tantamount to a subsidy. Tax breaks are an informal “subsidy” to spur business, with a cost incurred by other societal goals. Decreasing environmental regulations are an informal subsidy to increase energy production with externalities borne by others. Etc etc. The broader point is that defining the utility function that captures these societal costs/benefits is complex and your false dichotomy misses all that nuance.
We should not equate rent seeking and genuine innovation as the same things.