Yet the scientific elite of the former USSR lived rarefied privileged lives of the very few.
Only the very top-top elite. My father was a very talented man that I would count among the scientific elite judged by his achievements and publications. But we were very poor. He got a regular salary.
But it is true that there were several scientific satellite towns, such as Dubna, that enjoyed a very high standard of living by Soviet standards. People live in Western-style houses, as opposed to small apartments, and could buy very good food, including delicacies, cheaply, while everywhere else there was a shortage of food, very poor quality and selection, and people had to stand in line every day just to buy basic items. But there science cities were very well supplied. However, Manch, this is not why people worked there - it was just an extra perk. My father is an example that it's not about money. I'll just repeat myself: scientists become scientists because 1) these are people naturally born with hyperactive curiosity (you know, how there are people with hyperactive sexuality, for example) and they must find an outlet for it, otherwise they'll explode; 2) because there are periods when science is prestigious in a particular society, which doesn't mean that scientists earn a lot of money, but rather they are treated by everyone as the most respected and valuable members of the society; people tip their hats when they see a scientist, as opposed to Bill Gates, for example. Today science is not prestigious, and this is why it's going to the pits. Science will never be prestigious in a truly democratic society because of human nature - human tendency to envy and resentment. An average can swallow that the highest honors will be given to people like Bill Gates because he can hope to become like Bill Gates himself one day, if only he gets one good business idea. But an average person can never hope to become a great scientist or artist because, to develop into one, you need not only to work very hard for very many years but you also need to be born with a special and rare talent. This is why those who are plebeians at heart will never stand for an elitist system. This is why a democracy never works in the long term - the standards in school education, science, art eventually collapse. (Yesterday I helped my son, who is in the 9th grade, with math. The problems they were solving were the ones I was doing in the fourth grade - elementary algebra. Talking about school education! No wonder the Chinese are taking over
).
All in all (to return to the original comment), I think it is important not to fall in, what I call, a free market fallacy. Free market is absolutely
indispensable to a well functioning economic system. It is what allows it to stay flexible and gives an outlet to natural human competitiveness and desire to stay at the top. But it needs to be supplemented with other mechanisms, because free market is a strictly short term solution. It will not solve a problem of an alternative fuel while the oil is still flowing. Somebody with a vision and ability for long-term thinking and planning must make an executive decision to allocate money to a long-term research. The same is true for basic research. My support for free market stems from my knowledge of the human nature. But my support for alternative, non free-market, mechanisms to stimulate the robust development of basic science (and art and philosophy, I might add), also comes from my understanding of human nature. There are different categories of people and they need to be stimulated differently.