You are almost on point here, but seem to be missing the primary point of my work. I work as a researcher at a university, doing more-or-less fundamental research on topics that are relevant to industry.
As I wrote: We develop our libraries for in-house use, and release the to the public because we know that they are valuable to the industry. If what I do is to be considered “industry subsidies”, then all of higher education is industry subsidies. (You could make the argument that spending taxpayer money to educate skilled workers is effectively subsidising industry).
We respond to issues that are related either to bugs that we need to fix for our own use, or features that we ourselves want. We don’t spend time implementing features others want unless they give us funding for some project that we need to implement it for.
In short: I don’t work for industry, I work in research and education, and the libraries my group develops happen to be of interest to the industry. Most of my co-workers do not publish their code anywhere, because they aren’t interested in spending the time required to turn hacky academic code into a usable library. I do, because I’ve noticed how much time it saves me and my team in the long run to have production-quality libraries that we can build on.
Software is a tool. I develop stuff that i know is of interest to companies working with everything from nuclear energy to hydrogen electrolysis and CO2 storage. I honestly believe I can make a positive contribution to the world by releasing that software under a permissive licence such that companies can freely integrate it into their proprietary production code.
I’m also very aware that the exact same software is of interest to the petroleum industry and weapons manufacturers, and that I enable them by releasing it under a permissive licence.
The way I see it, withholding a tool that can help do a lot of good because it can also be used for bad things just doesn’t make much sense. If everybody thinks that way, how can we have positive progress? I don’t think I can think of any more or less fundamental technology that can’t be used for both. The same chemical process that has saved millions from starvation by introducing synthetic fertiliser has taken millions of lives by creating more and better explosives. If you ask those that were bombed, they would probably say they wish it was never invented, while if you ask those that were saved from the brink of starvation they likely praise the heavens for the technology. Today, that same chemical process is a promising candidate for developing zero-emission shipping.
I guess my point is this: For any sufficiently fundamental technology, it is impossible to foresee the uses it may have in the future. Withholding it because it may cause bad stuff is just holding technological development back, lively preventing just as much good as bad. I choose to focus on the positive impact my work can have.