As always, Jerry Pournelle is worth paying attention to:
When most science is funded through taxes, then the peer review process takes over. Science administration is a bureaucracy, and that bureaucracy is as subject to the Iron Law of Bureaucracy as any other. The process weeds out silly grant applications and those based on truly unsound science, but it also weeds out bold challenges to the consensus, and the number of “peers” who adhere to the consensus grows. The result is concentration of resources on the popular hypotheses: often a good thing, but no formula for breakthroughs. How to fund contrarian ideas is the real challenge to government funding of science. We don’t really want to be handing grants off to the Flat Earth Society, but you know, I’d rather give them a million or so each century than beggar the country in order to enrich Al Gore.
Of course, any reasonable person would rather fund harmless kooks than fund deliberate liars (like Algore) who are out to enrich themselves by doing harm to enormous numbers of people.