Right. There are many things the government could possibly do, and it could theoretically do them as well as private sector does, and in many case even better than private sector (as governments enjoy many privileges that private companies don't). However, this is upper bound of what we could get from governments running things. Most of us need to settle with governments as they actually exist, and the actual outcomes. The track record does not seem encouraging, and arguments of the sort "this time it will be different, we'll just put our people in charge, who are better than people who were previously in charge" aren't particularly appealing.
You are missing the point entirely, the state or the market are fine, each approach has it's strengths.
Deals like this one are unacceptable because they are a Frankenstein monster - state guarantees profit, so the state bears all the risk. The normal market mechanisms don't work, inefficiencies and wastefulness is not punished, but profits are still private. It encourages the worst possible behaviour.
