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