It’s not only one user - people are talking and one guy finding out and learning about piracy can totally bring his friends to piracy, too. There is no downside to letting your friends stream from your jellyfin or to send that cracked copy to the guy from your soccer club

It’s not really stupidity. Just think about stuff that you may buy without having the expertise to really judge the quality or if it is even possible. You might think that people are stupid when they do not know every plant. But do you know every tool, every tech gadget, every type of clothing and so on?

outlawing linux

Yes. Some countries and states have proposed laws for age verification that would make Linux illegal.