Unfortunately, the social impact factor has been creeping in, in the form of more 'applied research' funding which is not fundamental and does not move scientific knowledge forward. The government has limited role in funding applied research, since industry is better positioned to understand what applied research is important and has a strong incentive to fund it.
Academia is imperfect, but the genius of the system is that letting scientists chase down interesting things does end up improving society dramatically in the long run.