It's impressive to compare five percent and some small fraction, but the total budget also expanded a lot since then. While in constant dollars the current NASA budget is indeed smaller than it was then, it is only about half.
At the end of the day, the kinds of things they spend that budget on make sense to me for a research organization, and it makes sense to me that retracing the moonshot steps happen in the private sector.
5% today would be more than $1tn - a government-funded industry bigger than the entire military budget, comparable to the biggest tech companies.
It made sense in the 60s because the spinoffs from the green field R&D, especially in electronics and computing, are still paying a dividend.
Today? It's hard to see a moon base paying for itself any time soon. There's plenty of science to be done on the Moon, but direct dividends for industrial development are less clear.
The original number "5%" refered to NASA spending as a proportion of the federal budget.
These baselines currently differ by approximately a factor of 4.
Were those dividends clear in the 60s? Or are they only clear now that we look back on the venture 50 years later?
The exploration directorate, on the other hand, with their billion dollar rocket to nowhere…