You talked yourself into nonsense.
On waste in DoD, sure, but not the parts I was talking about. Some of the big waste was, say, getting AC working in Iraq and now getting Diesel fuel and jet fuel to Akrapistan. And the cost of the black oil to send a destroyer across the Pacific would really set one back.
> Also you appear not to have any idea how much waste exists in Pentagon contracting.
Nonsense. All my early career was in DoD work, mostly in research, especially in applied math. E.g., I saved a project to improve the system that keeps an SSBN at the right depth in rough seas (and, thus, got my company a nice development contract). I found a solution to a problem of global nuclear war limited to sea, apparently later sold to a place near Langley, VA. I reduced to simple Lagrangian relaxation and the Kuhn-Tucker conditions a problem in non-linear, integer, max-min for evaluating the SSBN fleet. I know my way around the DC beltway, out to Vienna, VA, down Shirley Highway, up to Howard County, etc. very well, thank you.
What I saw in DoD spending was quite efficient, amazingly so.
For academic research, it takes some effort to understand it and how it can connect with entrepreneurship. Much of academic research is too far from real products for my tastes, and I complained about that when I was a grad student and, by accident for a while, a prof.
Still, the best of academic research is by far the best stuff, including for entrepreneurship. But it is crucial to pick and choose. And how to connect from academics to entrepreneurship is not so easy to see at first glance, varies across subjects, easy in some fields of engineering, super tough in some other fields, has varied across time, especially in recent years, but, net, in many cases can be quite easy, efficient, and effective.
The idea that the academic research is just generalized abstract nonsense and Greek chicken tracks is dangerously misinformed: In simple, blunt terms, for the technical areas of research, it is funded for essentially one purpose from essentially one source. The source is Congress, and the purpose is US national security. E.g., that's where Silicon Valley came from. Along with microelectronics. And the Internet. And the last I heard, the Department of Energy funded the BSD effort at Berkeley, and Congress funds that department also mostly just for national security.
In funding this research, Congress is quite correct, amazingly so. The beginning of the movie on Nash was correct: Essentially math research won WWII. No joke.
You are correct that SV would not be able to deploy the results of the research the way the DoD often does, but you are wrong to assume that there is nothing that SV could do. First, notice that much of the best research, especially for 'information technology', is done dirt cheap, typically by one person with paper and pencil. Second, notice that now with current computing, in a major fraction of cases, such research can be deployed at shockingly low cost. Not all research has to be as expensive to deploy as the B-2 bomber or GPS satellites.
There are many ways to waste money, and for SV to waste money. And PG's essay indicated some serious struggles in project evaluation. And there are plenty of posts, e.g., by Mark Suster, that on average VC ROI over the past 10 years sucks. So, SV is wasting money now.
But there are also some ways to make money, and I gave some rock solid ideas for how, based on research.
Long ago I guessed that no one would believe me short of my having a 300 foot yacht in Long Island Sound. By then I'm not sure I'll still give a sh!t about telling people things they so much don't want to hear.