People like Peter Thiel are right about the drought of fundamental innovation since the early 70s, but they are wrong in other ways that ultimately render their arguments void and hypocritical. Thiel backs the same right-libertarian economic policies that caused this problem in the first place. The reason we stopped going to the Moon and inventing new paradigms in computing is because we stopped funding it.
The simple fact is that only three kinds of entities can fund basic research in most fields:
(1) Governments.
(2) Gigantic corporations with entrenched monopolies so profitable that they can afford to spend like governments (e.g. the old Bell Labs). Usually deep lasting monopolies of that sort are government-granted... again Bell Labs is a good example. So this goes back to governments or alternately government can be seen as the ultimate super-monopoly.
(3) Individuals with absolutely stratospheric net worth (over one billion at a minimum). The problem is that there are few of these and fewer who really get science and care about it that much.
You can't -- and shouldn't be able to -- patent a law of nature. Discovering a fundamental principle that led eventually to practical fusion power, interstellar travel, or radical life extension (to give examples) would be among the most valuable acts in human history, but its economic value would be pretty darn close to $0. There is no way to directly monetize it. As a result, markets cannot efficiently fund basic research. There is no way to securitize it -- no marketable financial vehicle for valuing it, capitalizing it, or delivering returns on it.
Monetize-ability doesn't come in until later -- until engineers have assimilated the new scientific discovery or principle and designed practical and workable technologies based around it. Usually these are different people than the original discoverers. Sometimes this process takes generations.
Science won't come back from its present abyss until and unless we get over market fundamentalism and realize that there are some classes of human endeavor that markets just aren't very good at funding.
It's a fact that's been true throughout history too. All the wonders of the ancient world (pyramids, Roman roads and aqueducts, etc.) were built by governments. None were built by commerce. All the wonders of the modern world -- the Moon landings, the Internet, the ISS, the Human Genome Project, the harnessing of the atom -- are either wholly government funded or were set into motion by a substantial initial investment of government money. The only big set of counterexamples I can think of are mostly out of Bell Labs, which was funded by a government-backed telephone monopoly.
If you think Xerox Parc is a counterexample, go find the Engelbart demo. Parc was doing stuff that was trail-blazed by a DOD-funded SRI project a decade earlier. If you think Elon Musk's ventures are counterexamples, understand that both Tesla and especially SpaceX are built directly on massive amounts of government R&D over the past 50 years. SpaceX is basically commercializing a lot of NASA (and Soviet, and German) technology. Elon himself says this, to his credit.
Most libertarians are simultaneously pro-tech and anti-state-investment. This requires an act of willful blindness and ideologically driven self-delusion on the same level as believing that the Earth is 6000 years old and mankind coexisted with dinosaurs. There is simply zero historical evidence that you can have that cake and eat it too. This is a special case of the more general "public good denialism" of right-libertarian and conservative ideology. Market fundamentalism is, quite ironically, America's own version of Soviet dogma.
The deeper underlying reality is that to make a huge step forward like this requires enough capital to effectively insulate a group of smart motivated people from the market (and other forces and demands) long enough to enable them to try something fundamentally new. Nothing like that is ever profitable from the get-go. You can't bootstrap it. It must be a "pure act," almost Nietzschean, undertaken for the goal itself and nothing more. "We will go to the moon" or "we will build a pyramid" because... we decided to. Period. Only once the trail has been blazed can commerce come in and line the street with shops and houses. At that point you've de-risked the path enough that bootstrapping and venture funding and similar things become thinkable.
I'm not anti-market. I reject that fundamentalism too, and generally reject fundamentalism as a way of thinking. Governments can fund basic research because they can, but they stink at taking it beyond the discovery or prototype phase. I'm just saying that markets are good at some things, but not others. Market should be free to act where they are effective, but they should be part of a larger political landscape that encompasses multiple mechanisms that are (hopefully) given jurisdiction where they work best.
Everything I wrote here will remain true until someone figures out a way to profitably fund such things within a market framework. Given the monstrous challenges involved I'm not holding my breath. Patents would be a poor mechanism, since they would have the perverse effect of shutting down research in a whole area for a long time.