> In both cases, we are left with the question: Why are we letting this country develop malware with our approval and funding?

Because Western governments are the biggest customers of these companies.

Using Israeli companies makes it much more difficult for criminal defense lawyers to challenge the findings of investigations, additionally Israeli companies aren't bound by ethics codes and whatnot. Our governments can turn a blind eye what these companies are actually doing - we pay them money and get access to a target's device, no questions needed/asked.