I have the opposite opinion. US funding sources for science and engineering tend to be very government-heavy rather than industry-based; but in my experience those government grants, particularly DoD, emphasize research with specific practical ends. The obvious exception is NSF, but Europe also has similar obvious exceptions at about the same rate.

The big difference between the US and Europe, however, is that universities in the US depend on grants to fund PhD students. Many (most?) European countries have national funding programs for their PhDs, which frees up both the students and their advisors to work on whatever fancies them regardless of practicality. France is particularly notorious for this. US academics do not have this luxury.

In my field, by far the lion's share of impractical (Fun! I love it! But impractical) work comes from Europe.

Yeah this is specific to Europe, in particular Germany, where companies such as BMW would send engineers to work on a defined research project at a university, and then adopt the research if it pans out. In the US there’s far more leeway, and part of being a good PI is stealthily inserting yourself own agenda into the DOT grant proposal, and those in the DOT will give you the leeway knowing that’s “how it works”

I guess this varies a lot. To my shame I don't have hard numbers (! I really should have.)

Personally I've worked on a half dozen global research network projects bringing together both public and private funding and 10-15 organisations, mixed universities, research institutes, and small to behemoth companies.

The target is always some wide ranging new radical technology platform and they spawn a bunch of startups and spin off projects.

Some targets can turn out to be too difficult, or simply wrong, but I've never seen a project that hasn't lead to at least one startup / product / new technology.

From what I've seen, this is mainly a European thing. Chinese and US funding is designed to produce practical value, at least in theory.