Agreed killing off Bitcoin (suppressing/starving it) would be a defensive act, and it would be incredibly stupid for a government to try and do it by building a bank of chips to 51% attack the network. There are plenty of better and drastically more efficient options available, as you point out.

The idea was to put forward the strongest possible case for Bitcoin, being as generous to it as possible, but still show that it’s fundamentally inadequate for anything important, and that its defences are extremely tenuous.