It might seem like an odd question to ask, given the prominence of science fiction and fantasy in popular culture, and that part of the answer to the title of this piece is still "Yes." Science fiction still matters in the way that popular culture matters, as a shadow play for the popular psyche, as a common narrative language, and insofar as it provides insight into the way that people think and feel about various subjects in the conventional wisdom. It's only a short trip from science fiction to something like 24, where Jack Bauer does his duty and tortures the information about the ticking time bomb from unwilling subjects. It's relatively easy to find current SF that covers the same territory.
But in "Why Science Fiction Matters," I argued that science fiction is (or was) more than an escapist literature of popular culture, that it fulfilled a central role in the lives of at least one major segment of the post-war generation, the upwardly mobile children of working class (or agrarian) parents. For the tech oriented Baby Boom generation, plus a segment of a couple of generations before and after, SF provided a world view, including a program for the future, access to a social network, and a window into transcendence of the sort that usually falls to religion and philosophy.
The period of SF ascendance can be demarcated by the two major science fictional events of the 20th Century, the advent of nuclear weapons and the Apollo Space Man-in-Space Program. In truth, I would tend to move the starting point a little earlier, to the beginning of World War II, because that war was, in many ways, a science fictional war. New weaponry, especially radar, but also missiles, submarine technology, and so forth, played a major role in the fighting and winning of the war. Moreover, commentaries prior to the war speculated on whether or not the next war would be the end of civilization. And the savagery loosed during that war met or exceeded the most nightmarish visions of pulp literature.
At the other end, the lunar landings and the space program generally seemed to validate everything that had ever been written about space exploration, and an entire generation was sure that colonies on the Moon and Mars were just around the corner. That they were disappointed in this contributed to the anti-government backlash that occurred thereafter. To this day, there are SF fans who are sure that it was only the incompetence of U.S. bureaucrats that stood in the way of their dreams of interstellar civilization.
In fact, it was reality that nixed the deal. Space if far bigger and more hostile (and less economically valuable) than most people imagined.
That's the problem with reality. It keeps intruding and messing up our dreams. There was a time when it seemed like science and scientific authority would loom large on the political landscape. But science kept delivering bad news, like warning about environmental degradation, limitations on energy use, changes in the global atmosphere and the implications thereof.
And, in truth, SF had always been a bit anti-establishment when it came to science. Astounding, under Campbell, spent over a decade pushing ESP/PSI, to no good effect. Then there was the entirely embarrassing Dianetics episode. Toward the end, a good many SF types jumped on the SDI bandwagon, as yet another excuse for space research, just as solar power satellites (a truly silly idea), had gripped imaginations earlier, and still do, to this day.
But subsequent generations took a look at all this and saw what was basically an escapist literature that had been co-opted into a number of big budget motion pictures. Fun, but nothing to wrap your life around. Now, things like World of Warcraft take more of the escapist freight than does reading SF. For religious transcendence, people are showing a disturbing tendency to turn to—religion. And, as I say, the Authority of Science has a lot of people claiming to speak for it, or attacking it outright.
So where does that leave science fiction? The aging of the SF fan community has been much remarked upon, and it's a fact of life. To my eye, it doesn't really look like SF is currently the place where someone with something to say goes to say it (I suspect that blogging now occupies that ground), nor is it the place where people go to read what such people have to say. SF has spawned several sub-genres, like military SF, alternate history, paranormal romance, and the like, so maybe that is where the energy has gone, into smaller and smaller niches.
The center no longer holds, or at least it no longer holds that much attraction. But maybe that's just me being an old fart.