The government is expecting something in return for these breaks rather than them being some kind of gift, though.

The government is not monolithic and politicians might except other things than what their constituents want. It's a bad test of the value of an investment.

For sure, and it may well have been a terrible investment with terrible returns, but selling to the government and responding to government incentives is an entirely legitimate thing to do, rather than some kind of inherent weakness in a company’s model. A company being “saved” by a government contract is a company being saved by making sales to its largest customer.

And the government got it, in the form of a cost effective usa-based launch solution.

Expecting, perhaps, but in general there's little to no penalty if those expectations are not realized.