I'm one of those. See my book SCIENCE FUNDING: POLITICS AND PORKBARREL, Transaction Publishers., 1992. I believe I made the case that Federal funding has badly corrupted the scientific enterprise in the US. It has led to scientists chasing fads, it has frozen out innovative research (I've had that happen to me personally), and has resulted in a lot of second-rate and third-rate research being done (a full third of published scientific papers are never cited by other scientists, and these are the ones that passed peer review and were published; the stuff that's even worse never got published).
It has been said that 80% of the scientific and technical knowledge out there is in patents, not journals. I've been in academic and industrial circles and there is a very big difference between them. Two of my pet peeves are 1) seeing so-called "new" research that is really a repeat of work done in the '50s or 60's because the electronic jounrals don't go back that far and grad students are too lazy to pick up the print version of Chemical Abstracts and 2) esoteric academic work that hovers around the periphery of some major field but has no direct impact. The problem with grant agencies (and I am guessing that's where your beef is) has to do with the politics behind the science. I can remembered being lectured by colleagues about what buzz words you needed to include just to hpe to get funding. It turned into a grant writing game and I hated it. Now that I'm in the private sector, I've seen and done a lot of exciting things but just can't talk about them. At some conferences, I've even seen challeneges presented that we solved years ago. There really is a lot in the labs of privaate industry, but we do depend on university research to do the kinds of work we cannot directly invest in. What would be your suggestion for funding and/or directing non-private sector work?