Comment by whakim

Why is the NIH going to be less effective than the private market at allocating research funding? Funding scientific research is a great example of a problem markets don't solve well for the exact reasons you describe. Most research doesn't lead to tangible progress (or financial reward) not because the researchers are all idiots, but because you have to try a bunch of things and a lot of them won't work, especially with poorly understood novel phenomena. Markets will instead allocate funding to the least-adventurous surest bets. That argument aside, when you allow wealthy people to dictate the direction of scientific research, you're essentially subsidizing their individual research preferences using public money (the wealthy get to take a tax deduction for contributions to their foundations).