There are many things I would like to point out, but here is one rather bipartisan issue that has been around for a while. The picture below shows the growth of federal research funding (in constant dollars, so inflation is not a concern here). You can see that the funding has essentially tripled since the mid-1970s. And the biggest jump happened during the late Clinton and early Bush years.
One may argue that the world becomes increasingly technologically advanced, more research money is needed, etc. Let's see though what this funding increase did to the US universities. As somebody who has been in the field all this time, I could witness a significant transformation. Basically, the increased amount of available federal research funding made universities shift their main focus for faculty members toward research. Not that grants were non-existent before, but there used to be more of a balance between research and teaching for tenured/tenure-track professors. And now the quality of faculty is measured almost exclusively on the basis of external research funding. Yes, there are still quite a few professors from older generations who are quite dedicated to quality teaching. But any new hires are evaluated not even on the basis of their research capabilities but on the basis of fundability of their research. Teaching can become an issue only if a candidate is so poor in this area that he or she would obviously cause many critical complains from the students. Some senior endowed professors are even hired with an explicit (though not broadly advertised) agreement that they would teach a very limited number of undergraduate courses or no such courses at all. And significant external research funding is the main essential requirement for promotion or already tenured faculty.
Yes, universities still tend to give some recognition to outstanding teachers, and those divisions of university administrations that deal specifically with undergraduate students are still concerned with the quality of teaching, but departments as such are much more concerned with the externally funded research. To speak bluntly, they view teaching as an overhead to their work. And even many colleges and universities that have been focused mainly on undergraduate teaching historically have started betting on external funding more and more in the last couple of decades.
When you have a small talk with somebody and mention that you are a university professor, they would usually ask, "What do you teach?" Many of my colleagues are offended by this (though they would not show this to their vis-a-vis), because they consider themselves researchers and not teachers. Undergraduate teaching is delivered increasingly by non-tenure track (adjunct, temporary) faculty. And, even though a professor teaching a couple of large freshmen-level classes, brings more money to his or her university than their well-funded research-minded colleague, the level of recognition (including promotion, salary, etc) is still much higher for the latter.
This is quite natural. Undergraduate students/candidates sill apply for admission, thus their tuition payments are taken for granted by universities, and the external research funding is an extra that university feel free to pursue, re-allocating their efforts to hiring researchers. There is now a generation or two of faculty who came to their positions with this new mindset. Do not get me wrong, I strongly believe that creative scientific work is crucial for a university faculty who is to teach not only a bunch of facts but also a certain mindset. And I have received more than one NIH grant during my carrier. But balance is important. Universities that disregard undergraduate teaching is a nonsense. And remember, the government can increase funding three-fold, but it cannot increase the number of able researchers the same way, thus much money becomes wasted. Moreover, as it always happens, this excess money breeds all sorts of parasites, political and otherwise. Thus all the pseudo-science topics, the highly politicized climate research, etc (I do not want spend too much time for discussing those here). The quality of undergraduate education declines, especially in STEM areas. Professors need more and more graduate students - not as future academicians, but as hired hands in the lab - and universities have to rely on foreign students more and more, as the supply of able and willing American candidates dwindles and remains available only to the universities with the highest reputation (that is often not entirely deserved, as a graduate student at places like Harvard can be a part of a 40-people lab, where the members do not even have much interaction with the PI professor). BTW, overproduction of PhD's who are not really well-developed and capable scholars is yet another issue these days, but let's not digress too much.
Moreover, university scientists develop a tremendous sense of entitlement, viewing the increased research funding as somehow being their right, regardless of the practical output of their research. There have been some drive to require more practical results lately, but the overblown system reacts largely by increasing the ability of those who influence distribution of funds to pick and chose those whose research topics they personally favor.
To summarize, the amount of federal funding available to universities has grown to levels that cannot be digested with good _real_ scientific productivity (the quantity skyrockets, but the quality does not) and that made the universities shift their focus away from their mission of teaching students toward - not even excellent research but research-related money-milking.
All right, enough for now.