Even in the defense industry, a cost-plus contract with a 10% margin is a lot. And it’s a federal crime to include costs in the overhead amount that aren’t traceable to the actual project.
The overhead simplifies this to a large extent in that the PI only needs to account, as a "direct" expense the cost of his team (salaries, and things not covered by the university such as compensation to human subject volunteers, etc.)
One clarifying point. Indirect is normally charged on top whatever the PI gets. So they don't "take out" 50% the total. They add 50% to the original grant. So if a researcher gets a $500k grant, 50% indirect would be $250k, and the total allocation is $750k.
The corporate equivalent would be a fixed price contract, which has overhead built in and far exceeds university rates.