True. A modest loss or break-even would be sufficient.At the same time something that is fundamentally a black hole for public funds would never get operated so would not be considered.
I am not sure that any Sleeper services could be operated with a 'modest loss or break even'. Is there anywhere in the world that has Sleeper services that do that? (apart from high end luxury trains, such as VSOE or Rocky Mountaineer, which are not really public transport). Of course, the same could be said about most day time trains too, but, per passenger, the subsidy for a sleeper train will be higher (in some cases such as the Caledonian Sleeper, spectacularly higher).
So, for what reason would there be to pay this additional subsidy for Sleeping Car passengers? Business and high end passengers are going to travel by air pretty much no matter what the price is. The genie of fast air travel is not going to be put back in the bottle - and neither should it be. Should it be more expensive? Probably, but that would not put many more of those passengers into Sleeping Cars. (I have heard of all the arguments about saving on hotel bills by travelling overnight etc. , but the railways have been pushing this ever since they had a total monopoly of this traffic, with virtually no success). I suspect that higher air fares for long journeys (+1000km) would result in fewer journeys being made, rather than a surge in anything but economy train travel.
So you are left with people travelling on holiday, or making one-off journeys for employment, study etc. Why can they not use day time trains and stay overnight en-route in the case of a long journey? Sure an overnight train may be more convenient for them, but is that a good enough reason to use extra public funds to subsidise? Perhaps there needs to be a social change that people will take fewer holidays, but for longer periods at a time, so the speed of the journey to & from is less critical, or alternatively the (more expensive) air fare is paid less often.
Much as I love travelling in them, sleeping cars are an anachronism, much like freight on canals or Ocean Liners.