What worsens the problem is that publicly funded research often solves toy application problems (at least in CS); academics know that they need to "apply" their

What worsens the problem is that publicly funded research often solves toy application problems (at least in CS); academics know that they need to "apply" their research to get funding/citations/publications with relatively little effort, but from an industry/real-world perspective, many application scenarios hardly make sense and are hand-wavy-ly evaluated (for example, in applications of CS, too often the code is not shared so that the results are practically not reproducible). The current system simply rewards researchers who manage to get into the top venues with the least effort possible, and for many who aren't brilliant the pseudo-application approach is the way to go. IMHO, this broadens the gap between academia and industry, because it's hard for a practitioner to pick out the few relevant nuggets in a stream of half-baked applied research.