April 11, 1983 | Executive Memorandum on Smart Growth
The flight of the Challenger space-shuttle is A dramatic reminder of the enormous commercial potential of space in,Americals future. Yet as legislators now ponder -the FY 198'4 space budget, they must resist taking the first steps toward establishing an A m irak'in'space. Instead, they should demonstrate that'they have learned tAe lesson that the public is best served by the private developmentlof commercial opportuni- ties. Even now, NASA is not the only organization in space ., nor is the proposed sale of t he weather s'atellite'system the' first indication of private'interest in utilizing government owned space technology. Some companies are even planning to compete with'the 6huttle. Last September, for instance, Texas-based SS'I Inc. successfully tested a p rivately financed launch vehicle. 'A former NASA employeelhas formed a company to finance and market a private space carrier. A California company, Arc Technologies, is privately financing and developing its own launch vehicle service. And a consortium of Martin Marietta, Aerojet, and United Technologies is pressing the government t6 allow it to lease federal launch facilities to provide a private saltellite launch system. Yet there are indications that what may well become a-dynamic new private industry c o uld be held back, or even grounded, unless Congress and the President clearly endorse the concept ofiprivate commercial activity in space. There is a danger that the lessons of industries as diverse as telecommunications and trucking will @e forgotten, an d that instead of embarking on a policy of minimal gover1nment regulation and intervention, the federal government will suffocalte space entrepreneurs with red tape and subsidized government competition. When Cong'kess puts its final stamp on the 1984 NASA budget, and thelPresident makes his' much-awaited statement on commercial use of space, a clear signal must be given to the new industry--"All systems go.11 ! The existing maze of regulation must be rationalized, or it could become a strait-jacket to comm e rcial and technic'al innovation. At the moment, the Department of Defense, the Federal Mriation Administration, the Federal Communications Commission, and the State Department all are involved in the regulatory process; And there is a strong pressure with i n.the U.N. for an international satellite mbnitoring agency. Such a space-age version of the Law of the'Sea Treaty,would lead to U.N. control over many aspects of space commerce. The President-should direct U.S. diplomats @o oppose moves to undermine the o pportunities presented by the new1frontier of space. He should also announce that the Administration will require U.S. agencies to,adopt'a simplified regulatory regime designed to facilitate competition, markets, and innovation. Furthermore, the White Hou se should explore the possibility of parceling out most of the basic standard-setting to2
the insurance industry, whichhas.every incentivb'to.keep space vehicle s safe but economical. The role of NASA must be defined-more precisely since it is a taxpaye r financed competitor to the private launc!h systems. After all, the NASA charter limits its activities to research and development--not operations. Yet the House Science and Technolo I Committee has guietly gy agreed to change the 1958 NASA Act to expand the!agency's activities to .include the operation of a "Space Transportation"System." If this 'Seemingly minor change is included in the April i2 markup to the space budget and creeps into the final authorization, it will open the way for NASA to become a n "Amtrak in space"--government 6ubsidized space tkanspor- tation system. This would.gravely threaten priv@te, unsubsidized programs,. NASA,could price itself below the competition ana siphon off government business from private carriers. NASA could expect a cozy .working relation7 ship with the federal regulators, unlike the co4etition. Technical problems and cost overruns with the shuttle already suggest that NASA has bitten off more than it can chew. Meanwhile, the French-led 'Ariane system, using relati v ely simpl@_, expendable rockets, has cut deep into the muilti-million dollar satellite launch business. By putting so many of its eggs into the NASA basket, while frustrating private American firms, the United States is in aanger of losing-more and more b u siness abroad. Congress should remind NASA of its legitimate mission by reguiring it to concentrate on building an advanced resear6h and development knowledge base. NASA should share this technical information more readily with private industry, so that i n novations may be turned-to private use. NASA and the Air Force also.shouldimake launch facilities available to private ventures at an appropriate price. There must be limits, of course, to this op@n skies approach. National security, for instance, reguire s constrAints on the flow of 'd facility leases would technology. The price, if any, of innovations an have to be determined carefully. The goal of making these widely available would have to be balanced against the .danger of ihe possible discouragemeni o f totally private research and launch facilities' if government services were priced artificially low. From bold shoestring entrepreneurs to multi-.;,billion dollar con4lome- rates, American firms are eager to seize the commercial opportunities in space tr a nsportation, and provide new products and services. The Admini- stration must not allow this budding private creAtivity to be frustrated, in the mistaken belief that space is so exotic and expensive that it must be controlled and monopolized by the govern r Aent. The history of air travel and telecommunications demonstrates ciearly that the private sector will enter the most sophisticated fields And bring servicesto the public that had been unimaginable a few years earlier. America's future in space will be no different--unless Congress and the Administra- tion fail to give the private sector the clear gieen light it needs. Stuart M. Builer Director of Oomestic Policy StudiesF or further information: Richard Speier, "General Science, Space and Technology,"-in Eugene J. McAllister, ed., Agenda for Progress (Washington, D.C.: The Heritage Foundation, 1980). M. Smith, U.S. Civilian Space Programs, 1958-1978, Volume 1 (Washington, D.C.: Congressional Research Service). "The Second Space Race," Reason, November-198 1.