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Future of Space Program May Depend on Private Space Transportation

adam.summers@reason.org (Adam Summers) — Fri, 31 Jul 2009 22:37:00 EDT

Members of a subcommittee of the Review of U.S. Human Space Flight Plans Committee, an independent, blue-ribbon committee formed to analyze the U.S. space program, have recommended that the National Aeronautics and Space Administration (NASA) utilize private companies to transport cargo and people to and from the International Space Station. Relying on private firms for transportation services would free up NASA resources for more ambitious ventures, such as human missions to the moon or Mars.

"I think you will find out there are a lot of people who will rise and compete," former Boeing executive Bohdan "Bo" Bejmuk told the panel. "Some of them will fail, some of them will succeed, but you will have essentially created a new industry."

Private space companies like Space Exploration Technologies Corporation, commonly known as SpaceX, and Orbital Sciences Corporation have already made great strides in developing rockets and launching satellites and space probes. SpaceX won a $278 million government contract in 2006 as part of NASA's Commercial Orbital Transportation Services projects. In 2007, Orbital Sciences took over a contract worth $170 million for its Taurus 2 launcher and Cygnus capsule combination after underfunded venture Rocketplane Kistler failed to deliver on its financial objectives.

The potential cost-saving privatization recommendation comes as questions are arising about the accuracy of NASA's budget and the future of the space program. Current plans call for seven more shuttle flights through September 30, 2010, after which the shuttle fleet is to be decommissioned and new space vehicles are designed and built. The new vehicles are not expected to be completed for some time, however, leading to a "launch gap" of five to seven years. But according to human space flight review panel member Sally Ride, former astronaut and the first American woman in space, NASA's budget--which totals $18 billion for the current fiscal year--is unlikely to even meet current goals. "We have come to believe very firmly that it's important to have a realistic view of what the existing program as it will realistically unfold most likely will cost and not put any smoke and mirrors to the budget to make it look like it will fit under the budget profile," Ride said during a public meeting earlier this week. In addition, panel members noted that NASA was unlikely to complete work on the space station and retire the shuttle fleet before March 2011, which would require additional funding. "But, of course, there is no funding for that possibility," Ride noted. "That's setting you up right away for a budget problem."

William Watson, executive director of the Space Frontier Foundation, which promotes commercial space activities, welcomes private-sector involvement in, and competition for, space transportation services. "Let's have an American competition in space--to create good jobs, fuel innovation and close the [launch] gap more quickly," Watson was quoted as saying in a May 2009 FoxNews.com article. "With private funds matching government investment, we can dramatically leverage taxpayer dollars to produce breakthroughs in a new American industry-commercial orbital human spaceflight."

Aerospace consultant and retired NASA aerospace engineer Don A. Nelson similarly sees privatization as a way to stem rapidly rising costs, address the anticipated launch gap, and allow NASA to refocus on its core mission. As Nelson wrote on the nasaproblems.com blog earlier this year,

NASA is struggling with developing the Orion [space shuttle replacement] vehicles . . . one for space station crew rotation and another for the lunar mission. It is the Orion space station crew rotation vehicle problems that is causing the launch gap. Privatization of the shuttle fleet solves these problems and allows NASA the time, resources, and budget to restructure the Constellation Program (CxP) for their primary goal of returning humans to the moon and beyond. Privatization of the fleet avoids the costly and embarrassing space gap, saves critical space jobs, and insures the operation of the space station. Privatization provides avenues to regain a share in the commercial launch market, crew escape pods, and the foundation for a 21^st century reusable space based transportation system.

The government is increasingly coming to the conclusion that a successful space program will depend on a partnership with private-sector ventures. Utilizing these resources will help contain costs, leverage taxpayer dollars, take advantage of the innovation and expertise of those employed by private firms, and free up NASA to focus on its core mission.

Privatization at NASA: The End of Government's Monopoly on Space Exploration?

leonard.gilroy@reason.org (Leonard Gilroy) — Sun, 10 May 2009 08:18:00 EDT

FoxNews.com reports some big news on the commercial space flight front—NASA has announced a major privatization initiative involving procurement of rockets and crew capsules for manned flight missions:

NASA's critics have long asked: Why does the space agency need to design and build its own rockets and spacecraft? [...] NASA's beginning to agree. For the first time, after nearly a half century of building its own rockets and orbiters, it has approved the outsourcing of some of the equipment that enables its manned space missions to private contractors.

Last week, acting NASA Administrator Chris Scolese told a congressional subcommittee that the agency plans to give $150 million in stimulus-package money to private companies that design, build and service their own rockets and crew capsules — spacecraft that could put astronauts in orbit while NASA finishes building the space shuttle's replacements.

On Thursday, the White House ordered a top-to-bottom review of the entire manned space program, one that will be led by former Lockheed Martin CEO Norman Augustine, long considered a friend of private space ventures. Both developments show that the once-reluctant space agency and the Obama administration are ready to support commercial human spaceflight. [...]

"Our government space program has become over-burdened with too many objectives, and not enough cash," says William Watson, executive director of the Space Frontier Foundation, a Houston-based group promoting commercial space activities. Watson said that allowing private companies to handle routine orbital duties could free up NASA to focus on returning to the moon and going to Mars. [...]

Scolese said that $80 million of the stimulus money will be awarded to the company that demonstrates the best "crewed launch demo" — a prototype, based on existing cargo-capsule designs, modified for humans. The agency was careful to note that the competition will be an open one. [...]

The two leading contractors are building their launch vehicles from scratch. Their designs emphasize very efficient business models and low manufacturing costs. And they operate with at most a few dozen employees at their launch sites, as opposed to the space shuttle program's standing army of almost 15,000 workers. [...]

In late 2005, then-agency Administrator Michael Griffin announced that NASA was considering buying crew and cargo transportation services to the [International Space Station] from private industry. "We believe," he said, "that when we engage the engine of competition, these services will be provided in a more cost-effective fashion than when the government has to do it," Griffin said. "Let's have an American competition in space — to create good jobs, fuel innovation and close the [spaceflight] gap more quickly," he said. "With private funds matching government investment, we can dramatically leverage taxpayer dollars to produce breakthroughs in a new American industry — commercial orbital human spaceflight."

Read the whole article for a good chronology of NASA's gradual shift to privatization (something my colleague Ted Balaker reported on here and here).

Kudos to the Obama administration for laying the groundwork for what may produce a dramatic transformation in space flight. As Ted wrote back in 2005, "It's time to move past the era when governments monopolized space and celebrate the entrepreneur's return to the sky." Indeed.

Reason's full archive of space-related research and commentary is here.

Growing Jobs in Space

ted.balaker@reason.org (Ted Balaker) — Fri, 28 Oct 2005 00:00:00 EDT

Brace yourself for the "Beam me up" references, because William Shatner is headed back into space. Shatner has thrown down $200,000 to save a place on a private sector suborbital passenger service, which is scheduled to begin in a few years.

But is Shatner's Q-rating high enough for the presidential candidates to take note and throw a bone to those who care about space policy?

Sure very few voters really care about space policy, but some pundits say that in the final days of tight races candidates often make overtures to democracy's niche markets. They point to Kerry's recent urge to shoot a goose (paying attention sportsmen?) as the kind of campaign non sequitur that could show up again as candidates look to bag a few extra votes here and there.

Plus, space policy could be a key long-term component of what's typically at the top of voters' domestic worry list—jobs. It's always tricky to predict what sort of job creation figures a given innovation will yield, but if it turns out to be at all analogous to the aviation industry, the space industry gushes with job growth potential.

Over 100,000 Americans get paid to fly planes, but most of those with aviation-related jobs are not pilots, they're engineers, mechanics, airport managers, aviation educators, crew schedulers, and so on. Just one century after the Wright Brothers, the aviation industry employs 2.2 million American civilians.

And while there's much reason to be optimistic about the technology behind the private space industry, there's reason to be pessimistic about the process that controls it. In many ways, the top-down approach that governs space exploration is the opposite of the bottom-up private experimentation which invigorated aviation.

Unlike manned space exploration, aviation did not take off with a presidential declaration. It began with a great burst of decentralized experimentation, in which inventor's ambitions were stoked by more than 100 private incentive prizes. When Charles Lindbergh crossed the Atlantic alone and without stopping, he collected a privately funded purse, the $25,000 Orteig prize.

This environment produced all sorts of rickety contraptions, but the good ideas separated themselves from the pack, and the march of progress was brisk. Imagine that only 24 years separated Lindbergh's trans-Atlantic trip from the Wright Brothers' herky-jerky jaunt into history.

Still, many find it difficult to trust small groups of private people to continue such progress into space. Leaving the ground is one thing, they say, but leaving Earth's atmosphere requires the kind of might only government can muster.

Indeed, government has always dominated manned space exploration, and most people never thought to question the status quo. After all, we see the many billions of dollars that pour into NASA and assume that no private venture could drum up such funding. And what private venture would have the necessary patience? The space shuttle was intended to launch as often as every week, but decades later this goal still seems unrealistic.

Even so, it took a small team only three years and $25 million to send a private astronaut into space twice within one week. Besides fulfilling their own curiosity, the team members behind SpaceShipOne had the extra incentive of the $10 million Ansari X-Prize, offered by a private foundation.

Regardless of the specific goal, small groups of private innovators have made a habit of debunking conventional wisdom, and achieving what people previously thought could only be achieved with centralized control. The same kind of environment that fostered Lindbergh's triumph and the success of SpaceShipOne's designer Burt Rutan led to great leaps of progress in everything from food production to auto ownership. Time and again we relearn the same lesson: innovation�s best fuel is freedom, not government funding.

Some inside NASA point out that SpaceShipOne's team enjoys unfair advantages. If NASA tried to behave like a private entrepreneur, it would get slammed with probes and congressional hearings for circumventing the procurement process, for not spreading the work around geographically, and so on. Certainly, the problem isn't the people who comprise NASA, it's the process that saps their imagination, and forces them to behave like by-the-book bureaucrats. And so NASA does not just absorb money from the private sector, it also absorbs staffers whose talent would take the American space industry farther if it were allowed to slip out from under the weight of bureaucracy.

Thirty-five years after Armstrong's moon walk, mankind's subsequent giant leaps have slowed. The recently-released Adridge Report, the product of a presidential commission on space policy, notes that "today an independent space industry does not really exist."

It's time candidates paid attention to what makes innovation blossom, for while we now celebrate the birth of private space exploration, government is poised for another plunge into the dark. If we are to take him at his word, a Bush victory would mean returning to the moon, and eventually even a mission to Mars. There's a war of figures about how much the plan would actually cost—some claim that estimates of $500 million to $1 trillion grossly overstate the actual price.

But more tragic than the money spent could be the opportunities missed. If such lofty missions are pursued in the same top-down manner, who knows if exploration will be guided by what is most scientifically useful or what is politically expedient. Is going to Mars the most important thing we can do, or is Bush merely angling for ink in future history textbooks?

And just as most of us don't fly to Hawaii for a geology lesson, space exploration offers more than a growing tally of scientific achievements. It offers a new chance to expose more people to new kinds of fun and adventure. Centralized government missions would not be on the lookout for ways to allow the common man to enjoy space, and this means passing up all sorts of commercial applications and the jobs they would require.

NASA has long turned up its nose at space enthusiasts like Dennis Tito and boy-bander Lance Bass who were willing to fork over tens of millions of dollars to tag along on a shuttle trip into space. But already the private sector has dropped the price of space travel to $200,000 and found a new market. Roughly 7000 people have joined William Shatner on the waiting list, and Burt Rutan envisions a day when such trips cost about as much as a luxury cruise, meaning that the market will continue to expand.

And would a Kerry presidency be friendly to expanded private space exploration? We don't know for sure. Space policy analyst Mark Whittington argues that Kerry has no space policy, and while it's true his campaign has had little to say on the matter, buried deep within a mountain of plans and promises, the Kerry camp offers evidence that it noticed the race for the X-Prize:

[Prizes] allow the government to set a goal, while allowing researchers and entrepreneurs to pursue different strategies for reaching that goal. The private sector's X Prize illustrates the power of this approach.

The Aldridge Report dresses the prize concept with more specifics, suggesting the government could offer as much as $1 billion "to the first organization to place humans on the Moon and sustain them for a fixed period."

Indeed, if government cannot bring itself to leave space, it should at least follow the private sector model: spell-out the mission, offer a nice reward for its completion, and kick back until someone collects the dough.

Meanwhile, the private sector is already dangling new carrots. The X Prize Foundation has plans for at least six more competitions, including prizes for the highest altitude and most passengers carried. And the day after SpaceShipOne made its claim on the original X Prize by reaching a suborbital altitude of 62 miles, hotel magnate Robert Bigelow offered $50 million to the first private craft that can go four times higher and reach orbit.

Chances are the most lucrative prizes won't be announced in advance, but will be offered by investors eager to get in on a project that shows early promise. British billionaire Richard Branson has already joined with the team behind SpaceShipOne and committed over $100 million to create his Virgin Galactic passenger service. Although it's too early to tell what the future of private space travel will bring, aviation's evolution suggests that, with the right political climate, there will be plenty of private investors.

If government wrested control of aviation at its birth, who knows how the industry would have stalled. Perhaps we'd be as unmoved as we are about space policy, simply because there would be no way for us to know what we're missing.

Likewise, if space exploration remains the domain of government, we won't know what we're passing up. Will entrepreneurs offer same-day parcel delivery, super fast transcontinental shuttles, lunar honeymoon packages?

Just as the Wright brothers could not anticipate airport managers or crew schedulers, we cannot know what kind of space-related jobs will someday become commonplace. And since voters are always anxious about job creation, space policy might not be so far removed from their ground-level worries, after all. At the very least, that makes it worthy of a sound bite or two on the campaign trail.

Ted Balaker is the Jacob's Fellow at Reason Foundation.

Spaceflight in the Private Sector Will Eliminate Bureaucratic Drag

ted.balaker@reason.org (Ted Balaker) — Mon, 01 Aug 2005 00:00:00 EDT

Investor's Business Daily

On the same day NASA grounded the space shuttle program, space entrepreneur Burt Rutan and billionaire Richard Branson announced the formation of a new company that will build suborbital spaceships, some of which will be used to start a private space flight business. That these two announcements were made on the same day is more than an interesting coincidence, it foreshadows the future trajectory of manned space exploration — one dominated, not by NASA and bureaucracies, but by entrepreneurs.

Two years after the shuttle Columbia disintegrated upon re-entry into the atmosphere, killing seven astronauts, Discovery's return to flight was supposed to hush NASA's critics. Then a chunk of foam broke off an external fuel tank during Discovery's launch, prompting NASA to ground the space shuttle program until it resolves the problem. Such an announcement is hardly confidence-inspiring, particularly while seven astronauts float through space in one of those grounded shuttles. What's particularly troubling is that this is the same problem that led to the Columbia tragedy; even the dislodged foam chunks were nearly identical in size. When the foam hit Columbia's wing hot atmospheric gases funneled inside and tore the shuttle apart upon re-entry. Luckily, NASA believes Discovery avoided the kind of damage that spurred Columbia's catastrophe.

Yet we must consider the shuttle's grounding, the Challenger and Columbia tragedies, and other setbacks alongside the triumphs. All Americans look back wistfully on Neil Armstrong's moonwalk and NASA proudly points to inventions, from satellite broadcasting to smoke detectors, that our space program helped develop. Congress seems impressed. The House just voted to give NASA $34 billion over the next two years. But what will we get for the money? Now is the time to remember that innovation's best fuel is freedom, not federal funding.

Entrepreneurs like Branson and Rutan, not NASA, are the future of space travel.

Consider safety. Since humans began venturing into space, 4 percent of astronauts have died in the process. Rutan, whose SpaceShipOne was the first private manned ship to enter space, notes that you can't run a business killing 4 percent of your customers. Rutan wants as many people as possible to fly in his spaceships and that's one reason he's obsessed with safety.

Rutan's craft features a "care-free re-entry" design. It allows the ship to realign itself automatically, making it much safer to plunge back into the earth's atmosphere. When I interviewed him recently, Rutan pointed out that, after 44 years of manned space flight, NASA still hasn't achieved the kind of safety breakthroughs his small team achieved in a just a few years.

And what about scientific breakthroughs? Officials once expected the space shuttle to launch as often as every week, but decades later even yearly liftoffs are hard to come by. Meanwhile, the space station's scientific expectations keep getting pared back even as its cost swells past the $100 billion mark, more than a dozen times early estimates.

When NASA does tally up an impressive accomplishment, like crawling across Mars and beaming back intriguing findings about the red planet, it's easy to marvel at it and forget that sticking with the status quo can actually mean passing up even greater accomplishments. What if, instead of a top-down government-controlled monopoly, space exploration developed like aviation?

Aviation flourished in an environment of decentralized experimentation. Early aviators produced all sorts of rickety contraptions, but the good ideas quickly separated themselves from the pack. Imagine that only 24 years separated Charles Lindbergh's trans-Atlantic trip from the Wright Brothers' herky-jerky jaunt into history. Back then, the creativity of early inventors was stoked by over 100 incentive prizes and when Rutan's team claimed the $10 million Ansari X Prize, aimed at spurring private space travel, with two suborbital flights last year it signaled a return to aviation's entrepreneurial roots.

Indeed a presidential commission recently released a report outlining how the government could harness private creativity. Why not, the report asked, offer up to a billion dollars to the first organization that can return man to the moon?

Under that scenario we wouldn't be limiting ourselves to NASA's capabilities. As Branson put it, "Like many millions of people growing up in the Sixties who witnessed the wonder of man walking on the moon - I dreamt that one day I too would make that 'one small step...'! Unfortunately though, over the last three decades, many people gave up hope - luckily people like Burt Rutan never did. His vision has allowed people, like me, to dream again."

It's time to move past the era when governments monopolized space and celebrate the entrepreneur's return to the sky.

Ted Balaker is the Jacob's Fellow at Reason Foundation.

Focus on Air and Space Policy

Wed, 01 Jun 2005 15:30:00 EDT

Articles include:

Interview with Space Entrepreneur Burt Rutan,
Fly the Frugal Skies,
FAA Outsources Flight Service Stations, Saves Billions, and,
Airport Privatization Still Flying High, Overseas.

Other articles include: Governor Backs Private Airport for Chicago Suburbs; Will All Airport Screening Be Outsourced?; Pondering Core Functions in Colorado; Private Para-transit Helps the Disabled; Privatization Aids Rwanda's Rebirth; Break Up Violent Schools; Examining Eminent Domain; Privatization Briefs; and Who, What, Where.

Annual Privatization Report 2005 - Space Travel

Sat, 01 Jan 2005 00:00:00 EST

Space Travel

"It's Mainly Just for Fun"
After the X Prize
The Era of Personal Spaceflight

"It's Mainly Just for Fun"

Space entrepreneur Burt Rutan discusses how private space flight policy should emphasize innovation, safety—and having a helluva good time.

Lots of hard work. Big burst of publicity. Lots of hard work. That's been the pattern for Burt Rutan.

He is the model of persistent performance, averaging more than one new aircraft design per year for over 30 years. Then, last October 4, Rutan and his team at Scaled Composites grabbed the world's attention. They became the first private operation to send a man into suborbital space twice within two weeks, using the same vehicle. Rutan and company nabbed the $10 million Ansari X Prize, and proved that entrepreneurial creativity could extend beyond the earth's atmosphere. Now it'll take more hard work—both scientific and political—to make space tourism a reality.

Ted Balaker, Jacobs Fellow at Reason Foundation, interviewed Burt Rutan in April.

REASON: After the X Prize you enjoyed a huge amount of media attention. Do you think this burst of positive publicity will help improve the regulatory climate in which the private space flight industry operates?

Burt Rutan : Well, first of all we're working the regulatory climate very hard. We just had a two and a half hour meeting with an FAA administrator a couple of weeks ago, and we have a very specific regulatory plan for this new industry that we call private space flight. And it's a very specific plan on what's appropriate for, not just research testing, but also for the certification of things that will fly ticket-buying passengers.

I think that it is good that the public know what's going on. For example, FAA is having difficulty staffing their airplane certification staff with their budgets now, and for them to build additional staff to certify, not just airplanes but spaceliners, that's going to need, I think, public support in order to help their funding for this. So I think in general if you look back before May of last year, even though we developed some 36 different manned airplanes, we had never invited the press and the public to a research test flight. But starting in May of last year we had CNN, and we had print media out for one of our test flights. And then of course the big one was June 21st for the first manned private space flight where we invited the world's press and we had hundreds of print and broadcast media, and I think some 90 broadcast media video cameras.

REASON: There was that excellent documentary.

BR: Oh yeah, and the fact that we filmed in house for two and a half years and then made the deal with Discovery. They did a very good job with Black Sky (http://dsc.discovery.com/convergence/raceforspace/ raceforspace.html). They've shown Black Sky at least three times now and it's a full three hours, so we look back on that and realize that this was the right thing to do. It's not the right thing to do to bring in the public and the media for most research testing, but we realize that it is the right thing to do now, and answering your question, it really will be positive in terms of meeting the goals that we need for regulatory [policy]. It will be very positive, the fact that the public is not only knowledgeable, but is strongly behind us.

REASON: And you mentioned how you're trying to hash out a new kind of policy. What would you like that policy to look like?

BR: We've asked for a research airplane-like environment while a developer is doing his research testing in order to allow innovation, allow the test to be run with efficiency. And then we actually are asking for more regulation than the new legislation edicts. We do feel that the FAA needs to be accepting or proving the safety of the ship as it pertains to the passengers that get flown. Whereas their focus has been on only protecting the non-involved public who live on the ground below. We think that the industry will prosper only if there is some acceptance of [responsibility for] the safety of the ship as it pertains to the passengers.

REASON: What's the best balance to strike there? Because obviously informed adults already do all sorts of risky things from catching crabs off the Alaskan coast, to taking adventure vacations, or even just smoking three packs of cigarettes per day.

BR: Yeah, well for decades informed adults have taken treks to the top of Everest, even though more than 10 percent of those who've reached the summit have died on the mountain.

Now I don't object to that. I think that's fine. There should be freedoms. That people know that they have a one in 10 chance of dying by doing this and they still want to do it anyway, I'm the first one to say, hey, let them. However, I don't feel that that's the right thing to develop and sustain [for] a private space flight industry. Our goals are much more aggressive than that. Our goals are to have the same level of safety that the early airliners enjoyed, and a lot of people don't realize, but those early airliners 1927, 28, 29, 1930, 31, and so on, those were the first regularly scheduled commercial airliners. They were dangerous as hell compared to airlines today, however they were a hundred times safer than all of manned space flight. Not 10 times, 100 times safer.

Now I don't believe that it's right to say, listen, we'll let people take risks and we'll go and build the kind of systems that have been used historically for manned space flight, and somehow solve the affordability problem, and that's the only problem. We strongly feel that the biggest problem is the safety problem, not the affordability problem. If you fly dozens of people every day, you'll get affordability with almost any kind of system. The safety problem is the biggie, and that's why we think the most significant thing that came out of the SpaceShipOne program was not just showing that the little guy can fly above a hundred kilometers, without government assistance, and government technology, and government funds.

The real thing that we did here is to develop three new breakthroughs, and each one of them is going to have enormous effects on safety. The "care-free reentry" [in which the craft realigns itself automatically] is just one of those, so we think this is the right way to go and we think that we can get that level of early airline safety if we adequately do our flight tests ahead of time. We are developing a process that will not be debilitating like doing a Part 25 airline certification. That's where we're headed and I think it's the right thing to do.

REASON: Do you see the Commercial Space Launch Amendments Act as a step in the right direction?

BR: Well, it didn't address the problem that I'm discussing, getting an FAA acceptance of the safety of passengers. It doesn't address that. However, everything else in it is positive, there's nothing negative in it. It does address asking FAA to develop an experimental research category for launch licenses. However, it's not specific and we think it needs to be more specific to force FAA to regulate these tests more like airplane research rather than like they did our program.

The license process for our program actually decreased safety and it involved an enormous amount of monitoring. It forced our people to defend the product where our safety policy is to never defend it, but always question the safety. We have to get that changed.

REASON: How did the process compromise safety?

BR: We have, I think the count now is 39 new types—new airplanes from scratch—in 30 years. We have yet to injure a pilot. We've had things like landing gear failure, but we've never had a real accident. And that's a record that no one has come close to, and we maintain that a major reason we have a superb record is our safety policy, that we always require of, not just people building it, but those designing, flying, and testing it. But to never, ever put themselves in a position where they defend the safety. Once they do, you're screwed.

We always want them in a mode in which they question the safety. If you're always questioning it, you can turn around and find something better and immediately incorporate it. For example, if you had turned in last week a report to a government agency in which you've told them the product, as it is, is safe, if you discover something better next week, you have two choices.

One, you can go an write an addendum to that report and essentially tell the government, that, gee, I was wrong last week, it wasn't the safest that it can be, and now it is because I've discovered this new thing. And then you'll find yourself debating that with them and losing your credibility with them. We make changes almost every day when we're in a research mode. So you can see you get into this big back and forth in which they see you making changes after you defend the safety to them. Now the solution there is to never tell anybody that it's safe, but always question it, which then allows you to immediately incorporate safety features and go on. And, instead of firing somebody who designed something unsafe, you reward whoever found a better way and congratulate him.

The other choice that people have is they'll see something safer and they'll realize they just told the government that it was safe last week. And then they make the decision that, well, you know, last week's configuration—it's safe enough. Another thing too is that we're a small company. We don't have a big safety department that works with the government regulators. We have the people that are there testing the product and we can only afford to have the team that's there. And now we get our team, instead of focusing on the job of making it as safe as possible, they're distracted to write reports and provide data for the government.

Another thing too is it forced us into flying trajectories and glide paths back over the airport that weren't the safest ones to fly because they, the government, was only interested in the best safety for people on the ground. Now if you look at it, for many decades, you go back to the 40s and you find that all the research flight testing done up here in this desert, there's been hundreds of accidents with research airplanes, but nobody's ever been hurt on the ground. So why would you compromise the safety of the test pilot in order to make it more safe for people on the ground?

REASON: Let me read you something from a recent interview in Wired magazine with [then NASA Administrator] Sean O'Keefe. He's addressing the SpaceShipOne launch, and says yes it was amazing, "but let's put this in a relative context. Mike Melville went half the altitude that Alan Shepard did, for a fraction of the amount of time, did it 40 years later, and flew in a plastic airplane fueled by laughing gas. From a technical standpoint, this was a modest objective, except for one major point: They did it themselves. It's like a bunch of guys doing this in their garage."

BR: And what he didn't say is that we developed three new breakthrough technologies, which will allow us immediately to launch a commercial spaceline industry in which people can fly at the same safety level of the early airlines. What Alan Shepard flew in was an expendable booster with a parachute recovery, and for 44 years of NASA manned space flight, they have not made significant improvements in concepts that will allow safe access to space.

REASON: For those interested in space policy, it seems like there were two camps when the question was—what's the biggest barrier to private space exploration? Some people said it was a regulatory, government-imposed barrier, and others said it was a perception barrier, that people could not imagine a small group of people doing what you did. How do you see it?

BR: People may interpret the regulatory barrier as the government won't let you fly something that is safe enough to fly. That's what people may think the regulatory barrier is, and I want to make it very clear that that's not my opinion at all, and this is true with airplanes, too. The regulations for light planes, which is called Part 23, there isn't anything there [that doesn't let] you fly something that otherwise should be safe. In fact, if you make an airplane that just barely makes Part 23, it'll be a lousy airplane that in my opinion is not very safe.

But it's a process that [involves] working with naïve, and sometimes inexperienced, regulators who won't make a quick decision, so it drags your program out. I don't see anything in the regulatory rules that's restrictive. I think it's too early to regulate because they don't know what new ideas will come out. For example, if you assume that something is like a V-2 Rocket or something is like a Mercury Redstone, you can regulate that, and they have been regulating things like that for 10 years under the Office of Commercial Space Transportation. However, for them to apply those rules for something that flies to space like an airplane does not work. So they can't sit down and write regulatory rules for things that will happen in the future because you can't know what's going to happen in the future.

I have a solution for that, and that's what I'm working on right now. The developer himself [should] define the testing that is needed for his system to show that it is safe, and he negotiates that test plan with the FAA, and they approve the fact that he did it. I think that it's the only way to do it. You can't regulate spaceships like you can airplanes because every one of them is different.

REASON: Let's talk about the possible job creation effect of the private space flight industry. Because you look at, for example, the Wright brothers. They couldn't have anticipated professions like airport manager or flight attendant, and yet today the aviation industry employs millions of Americans.

BR: When people think of the Wright brothers they think of 1903. I think a more important thing to look at when you make the point you're making is 1908 to 1911, early 1912. We're talking about only a three and a half year time period that started when only 10 people had flown, and ended three and a half years later when thousands of pilots flew hundreds of airplanes in 39 countries.

Those people were doing it just for fun because they weren't developing airliners yet, developing the World War I airplanes yet, or even the mail planes yet. What happened later were the applications, but people wanted to fly. People the world around wanted to fly with a barnstormer, people wanted to go to air shows and see them do loop-the-loop. You know, this is all kind of fun.

Go back to 1977 when you could first buy an Apple computer. This was a big deal that people could have computers, but the personal computer was mainly for fun. Most people used them for games, and balancing our checkbook with a personal computer really wasn't why we bought personal computers. I mean, people said, well that's why we need them, but if you think about it, until we had the Internet, we didn't know what computers were really for. Now it's our communication, it's our commerce, it's our—everything.

I like to think that's what suborbital space tourism is; it's going to be a big industry. Just like personal computers. But it's mainly just for fun.

You've got to have thousands, tens of thousands, of people enjoying it in order to figure out what to do with it. We never would have invented the use of the Internet, the communication, and the commerce, and everything if you had just a few dozen people with computers. So I look at this suborbital phase that we'll go through, and I think we'll always have suborbital space flight, but I think the main thing is, is that people are going to flat enjoy it. And it's going to be absolutely thrilling. They're going to be floating their bodies around big cabins. It's not going to be just like the SpaceShipOne flights. There's going to be a lot more things you can do for the experience.

To answer your question, I think it's going to be a huge industry. And it's going to be competitive very early in the game, and ticket sales will come down to the point where hundreds of thousands of people will fly.

REASON: And I think the concept of fun you mentioned is hugely important and at NASA it's very different—they can't justify something on the basis of fun.

BR: No, and they don't understand the concept of taking risks in order to find breakthroughs. I hate to say that because we send billions to them for what we think is research but they don't do research, they only do development. They won't reach out and look for new concepts.

The same thing is happening with this Bush initiative, the Crew Exploration Vehicle. NASA's going to award multi-billion dollar contracts in September for the primes, and the primes are going to go out and they're going to fight to make sure that they win the next phase after spending billions, and because of that, they're not going to try new, innovative stuff. They're just going to just build some new capsules, and they're going to get launched by expendable boosters, and they won't go out and solve the safety problems that are preventing us from having resort hotels in orbit.

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After the X Prize

Will space exploration return to aviation's freewheeling roots?

Who could have imagined that a small team would need only three years and $25 million to send a private astronaut into space twice within one week. Besides fulfilling their own curiosity, the team members behind SpaceShipOne had the extra incentive of the $10 million Ansari X Prize, offered by a private foundation. But however inspiring SpaceShipOne's story might be, it is hardly unprecedented.

Aviation began with a great burst of decentralized experimentation, in which inventor's ambitions were stoked by more than 100 private incentive prizes. When Charles Lindbergh crossed the Atlantic alone and without stopping, he collected a privately funded purse, the $25,000 Orteig prize.

Indeed space exploration has proceeded differently than aviation. A presidential declaration spurred Neil Armstrong's moon walk, and space exploration has always been dominated by top-down government control. The recently released Aldridge Report, the product of a presidential commission on space policy, notes that "today an independent space industry does not really exist." However, the same report suggests changing course, recommending that:

NASA recognize and implement a far larger presence of private industry in space operations with the specific goal of allowing private industry to assume the primary role of providing services to NASA, and most immediately in accessing low-Earth orbit. In NASA decisions, the preferred choice for operational activities must be competitively awarded contracts with private and non-profit organizations ...

Recalling the spirit of the early days of aviation incentive prizes, the reports suggests that the government could offer as much as $1 billion "to the first organization to place humans on the Moon and sustain them for a fixed period."

NASA has long turned away would-be space tourists like Dennis Tito and pop singer Lance Bass who were willing to fork over tens of millions of dollars to tag along on a trip into space. Already, the private sector has dropped the price of space travel to $200,000 and found a new market. Roughly 7000 people have joined actor William Shatner on the waiting list, and Burt Rutan envisions a day when such trips cost about as much as a luxury cruise, meaning that the market will continue to expand.

A larger private-sector presence in space could also mean more jobs. It's always tricky to predict what sort of job creation figures a given innovation will yield, but if it turns out to be at all analogous to the aviation industry, the space industry gushes with job growth potential.

Just as the Wright brothers could not anticipate airport managers or crew schedulers we cannot know what kind of space-related jobs will someday become commonplace.

With the right legal framework, perhaps some day entrepreneurs will offer same-day parcel delivery, super fast transcontinental shuttles or even lunar honeymoon packages.

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The Era of Personal Spaceflight

When people look back in the history books, 2005 might be known as the beginning of the era of the Space Entrepreneur. Tremendous progress has been made since this report was last published. The X Prize has been won, the X Prize Cup has been established, and new space ventures were announced. Progress in privatizing space is dependent upon overcoming emerging policy issues and increased investment in entrepreneurial endeavors.

On October 4, 2004, Scaled Composites became the first private manned spacecraft to exceed an altitude of 328,000 feet twice within the span of a 14-day period, thus claiming the $10 million Ansari X Prize. Just as Charles Lindburgh won the Orteig Prize in 1927 to usher in the era of commercial air travel, the X Prize has ushered in the era of commercial space travel.

Granted, Space Adventures was the first to charge a tourist to go into space and it should be recognized for its landmark achievement in helping found the Space Tourism industry. The fundamental difference between the two is that the X Prize was focused on a sub-orbital flight that lasts a few minutes while the first space tourists took an orbital flight lasting a full week. With the price of an orbital experience still around $20 million, it is out of reach of almost everyone. To contrast, the initial cost of a sub-orbital experience is around $200,000 and is projected to go down as more flights and providers launch service.

Most importantly, this has demonstrated to the whole world that the space industry is most productive when privatized and placed in the hands of entrepreneurs. The use of prizes and competition has ignited a market for people to push the envelope and achieve something most people only dream of.

In a move of marketing brilliance, Virgin Galactic sponsored the historic flights and has subsequently licensed the Scaled Composites design and related technology to develop the world's first privately funded spaceships dedicated to carrying commercial passengers on space flights. According to testimony given at a hearing of the House Science Committee's space subcommittee on April 20, Will Whitehorn, president of Virgin Galactic, the subsidiary of Richard Branson's Virgin Group, said as of the date of the hearing that "29,000 people have said they're willing to pay deposits of up to $20,000 for spaceflights within a range of prices of up to $200,000." He expanded upon that comment saying "100 people have signed contracts with Virgin Galactic to pay the full $200,000 up front."

According to testimony given at that same hearing, Burt Rutan said, "By the twelfth year of operations 50,000 to 100,000 astronauts will have enjoyed that black sky view." This is amazing since as of the date of this publication, only 500 people have traveled into space. With flights scheduled for 2008 and new competitors preparing to launch service, we can confidently say that the "Era of Personal Spaceflight" has begun.

NASA Still Having Problems

Over the past year, NASA has seen a change in leadership with the appointment of Dr. Michael Griffin as the new administrator. He is coming into an organization that is still suffering the effects of the Columbia disaster and as of this date, the Space Shuttle sits on the launch pad waiting to go. This "analysis paralysis" has placed the future of the program and much of the organization into a position that it must fight for its relevance. From this fight emerged what is called "The Vision." "The Vision" or "Vision for Space Exploration" is based on the conference President Bush gave on January 14, 2004 and was covered in detail in the previous edition of this report. The essence of "The Vision" is to focus the goal of NASA on purely exploratory missions. This means more missions like the extremely successful Mars Rover, Cassini-Huygens (Titan) and Deep Impact (Comet Tempel 1). Other essential goals are to send a robotic mission to the moon by 2008, laying the groundwork for the return of astronauts.

In 2010, they plan to retire the shuttle and build a new spacecraft, the Crew Exploration Vehicle (CEV). The plan is to send astronauts to the moon no later than 2020, and establish a moon base similar to what they have got down in Antarctica. They plan to keep the Space Station on an exploratory mission but there is a serious gap because Russia doesn't have any obligations to transport U.S. crew members to and from the ISS after the return of Main Expedition 12 in April 2006. As of the date of this publication, Russia's obligations toward NASA for the training of crews and their delivery aboard Soyuz spacecraft expire in 2006.

This game of "space chicken" is set to hit a critical point next year as all missions by NASA that leverage the Soyuz program must be paid for out-of-pocket. This is compounded by a stickier policy problem: U.S. law forbids NASA from paying the Russians any real money, except under specific conditions that have not been met. In an attempt to squeeze the Russian government into enforcing existing nonproliferation agreements, the Iran Non-Proliferation Act or INA was signed in 2000. This act forbids NASA to send any money to the Russian Space Agency until the White House has certified that technology transfer to "rogue states" has stopped. Since no certification has been made, there is a deadlock looming on the horizon.

This shift of NASA as a pure exploration organization and the need for orbital flight alternatives leaves a large gap in the final frontier. One perfectly suited for the new "Space Entrepreneur."

The New Space Entrepreneur

The Internet boom of the last decade created many new millionaires and billionaires. With this new-found wealth, many of these tycoons are dipping their toes in the pool by creating space ventures. Many of these are close to bearing fruit because the same innovation these smart people applied to the Internet is working for the space industry. However, there are many opportunities emerging that are not the exclusive realm of the ultra-wealthy.

Privatization of space relies on those daring individuals to take monetary risk, but it also leaves room for early adopters with good ideas that have a good return on investment. For the most part, this is dedicated to the realm of angel investors that share the passion and understand the vision an entrepreneur has for their venture. There are some space companies one could start now (12-24 months) and some in the near future (five to eight years). Let's break down the categories of space entrepreneurship:

Launch Entrepreneurs—These companies are focused on the launch process, which includes the traditional use of rockets or moveable platforms. The use of rockets is not new, but companies like SpaceX are currently rethinking all aspects of this method to dramatically lower the cost of delivery by a factor of four. This means that all types or increased frequency of missions are now within economic reach of government agencies and corporations. They already have contracts and are launching their first rocket in 2005.

Looking a little farther out are moveable platforms, or what is being called the "Space Elevator." A space elevator is a physical connection from the surface of the Earth via an ocean- or land-based platform to a platform located in geostationary Earth orbit. The goal is to move people, payloads, power, and gases between the surface of the Earth and space. Current Space Elevator ventures like LiftPort and education foundations like Elevator:2010 are working hard to push through the technology barriers (i.e., carbon nano-tubes, beam power) by 2010 to place a Space Elevator into use by 2020.

Tourism Entrepreneurs—The space tourism market is not new; it is just getting tremendous press these days with the X Prize won by Scaled Composites. There are companies like Space Adventures that have been around since 1998. They designed trips as simple as visiting Cape Canaveral for a shuttle launch to brokering the flights of Dennis Tito and Mark Shuttleworth to the International Space Station. Another company providing service is Zero-G founded by Dr. Peter Diamandis, Chairman of the X Prize Foundation. Zero-G offers parabolic flights to experience weightlessness and has appeal for adventure travel, movie companies and government agencies.

What the X Prize has done is made people open to the possibility and opened up a whole new world of tourism opportunities that most people just dreamed about. In the next 12-24 months, Virgin Galactic will launch service and charge the general public for sub-orbital flights. There are many competitors preparing their own craft and over time, cost will come down and these companies will make the leap to orbital flights bridging the gap from early adopters to everyday space travel services.

Once companies do provide orbital service, space hotels will start to be built. Already, visionaries in the travel industry, like Robert Bigelow of Budget Suites, have started companies with a practical approach to creating destinations in space. So it won't just be about the fun of getting up there, there will be fun things to do when you get there. When you tie this into technologies like space elevators to deliver supplies and new launch vehicles to take passengers there it doesn't seem so out of this world.

Data Service Entrepreneurs—This is an interesting area because these companies are repurposing existing data services and building software for the current marketplace. EarthSat and DigitalGlobe are examples of service providers that use government or privately owned satellites to collect the data and do just that.

These companies then sell the data and related services to government agencies and private companies that have requirements in the areas of Geographic Information Systems (GIS), Agriculture, Weather Services, Geological Surveys, National Security objectives and much more.

Some of the more prominent examples where these services are used by the general public are TerraServer from Microsoft which leverages data from USGS or Google Maps which leverages data from EarthSat and DigitalGlobe.

Communication Entrepreneurs—These companies are focused on leveraging the communication aspect of space systems. They are usually grouped into two areas: media entertainment and space communications systems. Companies in media entertainment are launching new communication services, opening up a whole new media channel. Primary examples of these companies are XM and Sirius radio. Both are pioneering the XM band of radio and looking to add real-time GPS traffic services, data services and video feeds as the service grows in popularity.

The space communications systems segment is a mix of companies that provide monitoring software, GPS hardware, and mobile device communications. In monitoring software space, Deimos Space is an example of companies that provide parallel computing and database systems to control and monitor satellites. Global Positioning Satellites (GPS) is one of the most popular technologies companies leverage to provide hardware-related mapping software. There are many companies in this segment, the most popular being Garmin and Magellan. In the mobile communications area, cellular phones are the dominant path, but entrepreneurs are leveraging satellites to provide something as straightforward as satellite phones (i.e.,Iridium, GlobalStar) to accelerating the delivery of digital content and making information access more ubiquitous.

The new space entrepreneur is working now to uncover new opportunities that create jobs for communities and generate wealth for shareholders. As for those entrepreneurs working on longer-term (5-10 years) enterprises, they are currently making breakthroughs in areas such as materials and propulsion. While these breakthroughs have far-reaching implications, there is an immediate upside for technology transfer and licensing opportunities. This allows space entrepreneurs to make a very big business out of innovation to enable their long-term vision. The only things standing in their way are the policy roadblocks that hinder trade and free enterprise in this global economy.

Overcoming the Red Tape: Policy Issues

We discussed earlier in this report the issues NASA must deal with regarding the Iran Non-Proliferation Act of 2000. However, there are broader policy issues that impact the privatization of space. These come from improving export controls handling private space launches, providing incentives to accelerate the privatization of space.

Export Controls: Problems still exist from the 1998 Strom Thurmond National Defense Authorization Act, which transferred export licensing from the Department of Commerce to the State Department. As of this report, controls are tightening and jeopardize future collaborations from entrepreneurs from various countries.

However, its distant cousin, the International Traffic in Arms Regulations or ITAR has become a serious problem. The recent launch of a Chinese rocket with a European-built satellite did not have any U.S. components. Also, Virgin Galactic is having serious problems getting access to Burt Rutan's designs for the next generation of suborbital vehicles, which they have financed. These two recent events are signs that the ITAR process is doing more and more serious harm to the U.S. space industry.

Congress has heard the cries and not answered them, so alternatives to resolving the problem must be found.

Private Space Launches: In Washington, some of the regulatory hurdles for the industry were removed with the passage of HR 5382, the Commercial Space Launch Amendments Act, in the final hours of the 108th Congress.

The press surrounding the SpaceShipOne flights accelerated its passing, which establishes the process for private citizens to fly on spacecraft launched from the United States. The Act is not perfect, but it is a solid beginning, and aerospace companies at least now know where to go for licensing. Ironically, the only critique of the law comes from SpaceShipOne's designer, Burt Rutan.

He has been a harsh critic of the office of the associate administrator for commercial space transportation, known as the AST. AST's stated mission is to "ensure protection of the public, property and the national security and foreign policy interests of the United States during a commercial launch or re-entry activity, and to encourage, facilitate and promote U.S. commercial space transportation." Mr. Rutan stated at the April 20^th House Science Committee's space subcommittee that the policy of the AST "resulted in cost overruns, increased the risk for my test pilots, did not reduce the risk to the non-involved public, destroyed our 'always question, never defend' safety policy, and removed our opportunities to seek new innovative safety solutions."¹

He believes that craft like SpaceShipOne should be regulated like aircraft. He noted that "the airline experience has shown us that it is not just technology that provides safety but the maturity that comes from a high level of flight activity". His contrarian views place him in a controversial position that goes against the Commercial Space Launch Amendments Act, which leaves the regulation of suborbital spacecraft within AST.

While he supports the other parts of HR 5382, the certification process for "SpaceShipTwo", the vehicle under development for Virgin Galactic, is forcing the FAA and AST to work together. The results of this new working relationship are still to be determined.

Incentive and Relief Programs: The attention-grabbing events of the X Prize and President Bush's "Vision for Space Exploration" reinvigorates a timeline for companies to explore the stars to chase that entrepreneurial spirit and create new space ventures. As mentioned earlier in this report, there are many new types of space entrepreneurs emerging. Some have an eye on making money in the next 12-24 months and some have a 10-20 year vision.

What they share in common is what the government does to foster innovation and growth. Right now, the U.S. government has treaties in place that prevent them from offering land grants on the moon or securing monopolies for companies that develop and build new, low-cost and reliable space transportation systems. This means finding a starting point for incentives and various relief options.

In last year's report, the book "Space: The Free-Market Frontier" by Edward L. Hudgins was mentioned because of innovative tax policies suggested by former Rep. Bob Walker (R-PA).² This 25-year tax holiday is intriguing, but we must make small steps to accelerate change. We are optimistic with a new vision put forth and a reinvigorated interest in space that new legislation will move forward to increase the incentive for privatization.

One of those core legislative moves is the push to eliminate tax burdens. A few years ago, Rep. Dana Rohbacher (R-CA) proposed a "Zero-G, Zero-Tax" incentive. This has been reintroduced to the House as the "Zero Gravity, Zero Tax Act of 2005." This bill includes capital gains exclusions and investment credits to create an enterprise zone in orbit similar to the advantages Internet commerce has with a tax-free zone.

Another alternative is to be more earth-based and follow some states motivating companies with tax credit awards. A perfect example is the state of Oklahoma awarding Rocketplane $18 million to fund its space plane program and transform the former Clinton-Sherman Air Force Base into the Oklahoma Spaceport. This is also happening in New Mexico and in California at Mojave Airport where Scaled Composites, builder of SpaceShipOne, is located. These "Space Incubators" could be the focal points necessary to share resources and promote this emerging industry.

Conclusion

This has been a landmark year with the X Prize won and the beginning of the era of the space entrepreneur. Privatization of space seems more and more potentially profitable by private industry, which motivates government agencies and business to innovate and meet this emerging market opportunity. However, with all of the advancement and enthusiasm, there must be the will to overcome regulatory and policy disagreements that hinder our progress. As we move forward, new policies will be introduced and old treaties updated to fit the needs of the global economy. This is our chance to answer the call for a new future where all of humanity has the opportunity to go to the stars.

By Steven J. Fisher, founder and CEO of SlipStream Air.

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Endnotes

1 See Rutan's statement at: http://www.house.gov/science/hearings/space05/Apr20/Rutan.pdf.

2 The proposal calls for a total tax holiday of 25 years for any business or non-governmental organization that could build a permanent base on the moon.

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The Final Frontier of Tourism

bob.poole@reason.org (Robert Poole) — Fri, 04 May 2001 00:00:00 EDT

The Wall Street Journal

It took Dennis Tito $20 million and Russia's newfound capitalist instincts to get into orbit as the world's first commercial space tourist. But what will it take for the rest of us to be able to book passage into space?

The National Aeronautic and Space Administration's incorrigible opposition to Mr. Tito's plan had little to do with its expressed concerns about safety and much to do with its central planning mindset. Since its creation by President Eisenhower in the post-Sputnik panic, NASA has been imbued with a we-know-best approach to space. That was evident from the early days of the Apollo program, when NASA leaders and President Kennedy opted for the brute-force, direct-to-lunar-orbit approach — against the advice of its scientific advisory commission, which recommended a slower and more evolutionary approach.

Modus Operandi

The latter would have involved successive upgrades of existing launch vehicles, to assemble the moon lander in earth orbit. The former required developing the massive Saturn V rocket, able to lift the entire mission in a single launch. It was riskier and more costly, but because it worked in that case, the gargantuan one-best-way approach became NASA's standard modus operandi.

Thus, once the moon landings wound down, instead of evolving the Saturn rockets and building on the early Skylab space station, NASA scrapped both and aimed for two massive new programs along the same lines: a reusable shuttle and an all-new space station.

Both have suffered massive delays and huge cost overruns. The cost per pound of lofting payloads into orbit on the shuttle is actually higher than on the 1960s-era Saturn rockets. This supposed all-purpose launch vehicle is so costly to refurbish and relaunch that it has never come close to its initial promise of being a "space truck," launching routinely once a week. Unfortunately, by attempting for many years to make the shuttle America's sole launch vehicle, NASA stifled what might have become, by now, a viable private-sector launch industry.

But NASA never seems to learn from experience. Its attempt to develop a shuttle replacement was Lockheed-Martin's X-33, another one-best-way attempt to develop "the" next generation reusable launch vehicle. After the X-33 ran several years behind schedule and well over budget, NASA pulled the plug in March — after having spent $1.3 billion. And now, instead of admitting the underlying mistake, NASA has embarked on a second attempt at a shuttle replacement, the $4.5 billion Space Launch Vehicle.

Thankfully, U.S. policy toward the fledgling aviation industry was never this single-mindedly wrong-headed — or else air transportation might still be a government monopoly with millionaires bidding for a seat on the first transcontinental flight in the National Jetliner, a $5 billion cargo/passenger/reconnaissance transport, for both military and civil uses.

Instead, government carried out basic aeronautical research and made the results available to the private sector. This role was played quite successfully by NASA's modest predecessor, the National Advisory Committee for Aeronautics. The result was an ongoing burst of private-sector creativity, as hundreds of firms tried out various combinations of structures, powerplants, and layouts to figure out what worked and what didn't in making aircraft suitable for different purposes.

That trial-and-error process led, eventually, to a progression from early barnstormers to the Ford Trimotor, the DC-3, the Constellation, the 707, and today's modern jetliners. And a dazzling array of planes specialized for sport, business, cargo, defense, and other purposes.

The other benign government policy was airmail contracts. At first the U.S. Postal Service attempted to get into the airmail business itself, buying planes and hiring pilots. A series of crashes led to the decision to purchase airmail services, at a set rate per pound between points A and B. That policy left entrepreneurs free to experiment and innovate, eventually creating the predecessors of many of America's leading airlines.

If President Bush wanted truly to revitalize U.S. space policy, he would seek a NASA director willing to make a fundamental paradigm shift. NASA would reinvent itself along the lines of its NACA ancestor, becoming the equivalent of the National Institutes of Health for aerospace research. For international political reasons, it might be forced to continue developing and operating the International Space Station, but it might be able to outsource its management to a consortium of research universities open to partnerships with commercial firms, to cover some of the costs.

To provide transportation to and from the station, NASA (or its successor as station operator) should contract for the required space transportation services — not seek to design a "shuttle replacement." As the Russians long ago figured out with respect to their Mir station, one does not need a hugely expensive man-rated shuttle to transport cargo. That can be done at far lower cost via expendable cargo rockets, competitively procured on the basis of dollars per pound of payload, delivered to low earth orbit.

A far smaller passenger carrier could likewise be developed on a competitive basis, with NASA indifferent to whether the winning vehicle was expendable or reusable. The only real criteria should be the outputs — highly reliable delivery of people to low earth orbit at an acceptable cost.

All the government's other space launch needs should be met the same way. Whether it's NASA or the Defense Department or the National Oceanic and Atmospheric Administration, the general principle should be the same. Don't spend years of effort defining reams of launch-vehicle requirements. Simply spell out the payload needs to particular orbits, the reliability target, and the acceptable cost/pound range, and let rip the forces of competition.

Trial and Error

What would such a policy mean for space tourism? Apart from an occasional Dennis Tito, there will be no real space tourism until launch costs come down by an order of magnitude or two. And the best way to get from here to there is not NASA's failed one-best-way approach. Rather, it's the competitive, trial-and-error model that has produced today's global air-transport industry.

Besides the government research and procurement policy changes outlined above, another factor that could help is a system of prizes for those who attain space-launch milestones. The X-Prize Foundation, based in St. Louis, is pursuing just such a model, offering $10 million for the first team to launch the same reusable vehicle into space twice in two weeks without government assistance. Over a dozen companies are currently pursuing this goal.

One can envision a commercial progression from low-risk suborbital (Los Angeles-to-Hong Kong?) same-day package delivery, followed by suborbital passenger trips (mostly business, but some tourism), to be followed eventually by the first orbital passenger trips.

That's how markets develop. Not by a central plan, managed by the best and the brightest, but by the messy, gritty, trial-and-error approach of entrepreneurs pursuing a dream.

Robert W. Poole Jr. is director of transportation studies and founder of the Reason Foundation.

Meeting Space Launch Needs Economically

info@reason.org (Joseph P. Martino) — Sat, 01 Jan 1994 00:00:00 EST

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