Even big companies (biotechnological companies in this case) invest money only in specific research - a concrete drug or a concrete disease treatment

This isn't true. Research and development companies import most of their know-how from other RND companies with similar interests. In order to do this they have to attract scientists. This is because expired patents are hard to exploit, technical papers are difficult to read, conference gossip is valuable and elusive, and so on. The way you attract high-calibre scientists is by giving them considerable freedom to pursue whatever takes their fancy, including pure research. Otherwise they'll either be poor scientists or not interested in working for you.

Terence Kealey of Buckingham University, England, has analysed the history and economics of science funding. He has shown that every dollar of public funding displaces more than a dollar of private funding.

Government funding of science did not get going until the world wars. I hope we can agree that plenty of scientific progress had been made up till that point in history.

It's consistent to understand all this and to condemn President Bush's opposition to research which makes use of human embryos. Embryos aren't human beings. Life is valuable. It's perforce impossible to know which areas of research will yield the most fruit. These facts stand regardless of who pays your salary.