Agree, and I have no idea what's the optimal way for research to be done. My claim is that the way research is done today works for fairly small impact on taxpayer burden, and without natural experiments with other countries with spending of a similar scale to the US, it will be difficult to see which mode is best.
Bell Labs was amazing, but it also was funded in large by profits from an emboldened AT&T with monopoly power. Is monopolistic profit funding more efficient than taxpayer funding? No idea.
Regardless of inflation, AT&T made way less money in the 20s than any pharmaceutical company does today. If they could afford the research budget back then, then the pharmaceutical companies of today can too. It had nothing to do with them being a monopoly.
Bell Labs was amazing, but it also was funded in large by profits from an emboldened AT&T with monopoly power. Is monopolistic profit funding more efficient than taxpayer funding? No idea.