Because that is the competitive philosophy that allowed VS Code win in this space. It fits with that great quote from Bill Gates: "A platform is when the economic value of everybody that uses it, exceeds the value of the company that creates it."
By having VS Code give a priority to another MS/GitHub product that they aren't willing to give competitors, they're diminishing VS Code's value as a platform, and encouraging competitors to build their own IDEs rather than building on top of it.