It will never be allowed to happen in UK, but my ideal railway would be free at the point of travel, funded entirely from national taxation. The aim would be to discourage the use of private cars as much as possible, at least to/from big towns & cities. To meet that aim, free park/ride stations would be provided at key locations, and served by frequent train services.
I have wondered how viable this would be, in that is likely to be quite a bit cheaper to run as you'd not "have to" (although you may want them for other reasons) keep any of the gatelines, gateline staff, guards/RPI's for ticket enforcement purposes, ticket offices, delay repay, and probably several other staff rules.or procedures. There's also going to be some other costs savings (in theory there'll be less need for as many Twitter staff as well as lower energy costs from not having to run TVM's) and the potential for other income (renting out the space taken up by ticket offices).
The rail unions would be a little grumpy about the job losses so might try striking, but how they would play out is another debate.
Given that staff costs are about 1/3 of TOC costs, it's likely that we could see about 20% cut from the costs.
As such rather than the subsidy being £25bn (total costs) it would be £20bn, should that really be all that unaffordable for a country such as ours?
It would certainly reduce carbon emissions from transport, if it resulted in them halving then arguably the carbon cost per tonne would be about £350 (for the whole cost, although to justify the extra subsidy only about £180) and whilst quite a lot higher than the carbon cost used for value for money calculations, it's likely that it would have other benefits.
People may be fitter - as it maybe harder to justify car ownership so may walk or cycle more (the roads are likely to be less busy and so that becomes more attractive). As such could save the NHS money.
There could be reductions in road building and road maintenance costs.
There could be an economic boost as people aren't so limited in their ability to get about, opening up business opportunities the ability to do a better job, etc.
There's probably others, however there's also going to be issues. For example trains would likely be full and standing all the time and if staff levels are cut too far there may be anti social behaviour issues.