Much is often made of the free market as a force for innovation, and rightly so. The constraints of the market have proven to be a great impetus for progress. Many are looking at the emergence of Virgin Galactic and Boeing’s announcement of a commercial space business as proof that the private sector is the best avenue for progress in space travel. But the same constraints that make the free market such a powerful environment for change are not ideal for the long-term planning necessary for space travel. That is why when it comes to space, the government agency NASA is better suited for innovation and progress.
In terms of innovation, the private sector is not suited to long term projects. This is because corporations are based on quarterly reporting. If a project takes 20 years to complete, or even just to show some progress, that project is less likely to receive continual funding. Managers will see money flowing into a program every quarter but with no return on investment. Often, this will lead to a program being cut. This is, of course, why the free market is such a force for innovation; only the most efficient programs or ideas survive under this system.
But this strength is also a weakness. Because long term projects aren’t ideal in a private enterprise, innovation can become forced along paths that are not as effective in the long term. This can lead to path dependency, where a set of decisions made in the past can limit future options. The cost of going back to the other option can be prohibitive, leaving the group stuck with a less than optimal system. After all, an organization may have built an entire infrastructure around the first option.
Creating path dependencies is easier in the private sector, as cost and quarterly reports are added constraints. A company might develop a less expensive idea to ensure a quicker return on an investment. This is where government agencies such as DARPA have an advantage over the private sector: they can afford to be more concerned with results than with costs. They still have to worry about path dependency, but fewer factors push them in a particular direction. Without a quarterly schedule and pressure for a return on an investment, agencies like DARPA can pursue seemingly outlandish ideas. And they do.
Of course, this same strength is also a weakness. Cost overruns are common on government contracts. NASA is no exception, as the Webb telescope, the successor of the Hubble, has fallen behind schedule and gone over budget. Congress has continued to fund the project, as representatives are loath to cancel such projects for fear of losing jobs in their respective states. Many see the continued life of the Webb telescope as evidence that space programs should be handled by the private sector. But these critiques don’t recognize that building technology that has never been built before is incredibly challenging. Estimating costs becomes almost impossible, especially on a 30-year project like Webb.
But that is precisely why space is best left with NASA. Had the Webb telescope been a project in a private company, funding would have stopped years ago. NASA continues to pursue this project not because they hope for a return on their investment, but because they see the social utility in such a project. With the Webb telescope, they hope to unlock the mysteries of the universe and find life on other planets. These are not goals that translate well into quarterly reports, but they are worthwhile goals nonetheless and can lead to unexpected breakthroughs. And such advancements are cumulative, so there is a long term benefit in funding projects that seem to offer little tangible benefit.
Moving from telescopes to space travel the same holds true. Even moving at the speed of light it would take decades, even hundreds of years, to reach an extra-solar planet. This kind of investment of time makes it highly unlikely that the private sector would pursue the research to undertake such tasks. Add on top of that the potential for calamity to befall such a vessel along the way and the picture looks even bleaker. There needs to be some form of government involvement, whether it is to pave the way or provide government contracts to private corporations. The free market alone isn’t going to be enough.
To illustrate this point Virgin Galactic wouldn’t exist if not for help from NASA. In 2007 Virgin and NASA signed a memorandum of understanding with each other. This memorandum set forth that NASA and Virgin Galactic would work together, with Virgin Galactic gaining invaluable resources in the process. Without the help of NASA’s cumulative research on hypersonic vehicle concept maturation, computational fluid dynamics, and simulation support Virgin Galactic might not exist. So before we decide that space is best left in the hands of the private sector let us remember they are standing on NASA’s shoulders.
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