Why Isn't the US Government Funding Research?

thesandbender writes "The recent post about GM opening its own battery research facility led me to wonder why the US government is pouring billions into buying companies instead of heavily funding useful research. You can give $10 billion to a company to squander or you can invest $10 billion into a battery research and just give the findings to the whole of the US industry for free. From a historical standpoint, the US government has little experience with commercial enterprise ... but has an amazing record for driving innovation. The Manhattan Project and the Apollo moon missions are two of the pinnacles of 20th century scientific achievement, yet it seems to me that this drive died in the '70s and that's when the US started its slow decline. To be true to the 'Ask Slashdot' theme, what practical research do you think the US government should embark upon to get the most return for its citizens and the world?"