No, the point being made is that we wouldn't have been as far along as we were had we cut funding to such an impractical field.

A lot of engineering and basic research seems quite pointless until it, well, isn't.

I think ekpyrotic is suggesting that pre-WW2 Nuclear Physics would not have fallen under the category of "things with tangible, well-defined outputs." So the suggestion is that the US would not have researched Nuclear Weapons if they had decided not to fund Nuclear Physics research.

Actually US did not founded atomic research. It was kick started by French, English and to some extend Germans. Manhattan was mostly developed by immigrants from Europe.