Mentioning well-heeled research establishments that don't produce results brings up an interesting question: is there a negative correlation between funding and productivity?
You might think so, given the example cited in the previous post, and given the cases cited in Robert S. Root-Bernstein's Discovering. There have been many great scientific feats performed with what seemed like substandard equipment for the time. But does that imply causality, or does it mean that a first-rate scientist is capable of great work even under poor conditions? (A special case, perhaps, is Alexander Fleming. One time in his later years, he was being given a tour of a more up-to-date research site, and someone exclaimed "Just think of what you might have discovered here!" Fleming looked around at the gleaming work surfaces and said "Well, not penicillin, anyway.")
I'm not arguing for poverty. I think that a certain minimum level of funding is necessary for good science - below that and you spend too much time in grunt work, the equivalent of digging ditches with kitchen spoons and mowing the lawn with scissors. But once past that, I don't think the correlation of budget and results is all that good. There's perhaps a broad trend, but nothing you'd want to stake your career on.
That said, note that there are many ways to spend huge amounts of research money. You can lavish all sorts of new facilities and state-of-the-art equipment on people, or you can spend equal amounts by running a larger effort and trying to run many more projects at the same time. The people in the first case will live in a rich environment, while those in the second can feel rather deprived. Overall budgets aren't necessarily a good indicator.
I'd argue that you want people to feel reasonably comfortable, but not luxurious. If you have to scramble a bit for resources, you end up being more, well, resourceful. I'm not talking about redistilling your wash acetone (that comes under the spoon and scissors heading.) But if you have an idea which would require, say, a completely new hundred-thousand-dollar piece of equipment, you might be able to think your way out of that if it would be hard to get. While, on the other hand, if you just have to wave your hand and the stuff appears, you might get in the habit of not thinking things through.