No, the specific reasoning people are mentioning here over and over again is that we, as a people, should not subsidize businesses lighting their property on fire.
If they want to completely toss out the movie then they can. But it's insane to think the government should pay them for doing so because they say it has no value.
It's not subsidizing, government isn't paying the studio. It's just that the studio will pay less taxes because the tax is based on profit and the studio had a loss.
If they want to completely toss out the movie then they can. But it's insane to think the government should pay them for doing so because they say it has no value.