I know it's a bit of a libertarian viewpoint but it is not the government's job to be my nanny. If I wish to throw all of my money down the toilet on some hopeless start-up I should be allowed to do so.
Do you want to live in a country where other people can do equivalently stupid things and you have to deal with the consequences? No man is an island - some people are better making a burden of themselves than others.
We should have a rule that prevents people quiting thier perfectly sensible jobs to work on startups. They are risky as hell and when fali founders are burden to society.
This makes sense when the only actors involved are you, the start-up, and the government. In such a case, I would agree with you. To explain why such a case does not exist, I'll ask you this:
Why is the most important piece of information Kickstarter shares with you the amount already pledged? You can see this in their page layout and in their various widgets.
I would tend to agree in spirit but, of course, no one wants to throw their money away, they get tricked into doing so. Government does have an interest in the livelihood of its citizenry.
