I wouldn't say it was misdirected. There's just never enough to go around. Our greatest worry is that the pipeline will either slow down or empty at a time that we need to move to the next level from fundamental research.
I don't think you'd find anyone disagreeing that both are needed. But the more things become targeted, the less there is at the beginning of the pipeline. You can also make errors in deciding which technologies should leapfrog ahead of others. For example, there is a gap in design. Who would have thought it 10 or 20 years ago? We probably should have known that, but we're never going to get it exactly right.
Most of us are saying that you should get the core in place so that in the long term we have a funnel that is able to move resources into the more targeted and applied research.