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Space Economy: The New Commercial Frontier

The power of imagination is what makes humans different from other species. From the depth of their imagination, they write fiction. And these fictions allow them to do the unimaginable. When Jules Verne wrote his novel “From the Earth to The Moon,” for him, it was just a work of fiction, but for his millions of readers, it was a source of inspiration to go where no man had ever been to. Where writers like Jules Verne created a dream of a voyage in space, H.G Wells saw expansion to another celestial body as an inevitable task to save humanity. With that, scientists started to calculate the ultimate doomsday. They approximated a day, thousands of years from now when the sun will be dying, and there will no longer be any trace of human civilization. However, this distant future did not seem so distant during the Cold War anymore. Human civilization was at the mercy of two egoistic regimes who could wipe out the entire face of the earth by just clicking a red button. In the post-nuclear context, writers like Isaac Asimov and Stephen Hawking imagined a way to safeguard humanity. And the solution is to create “interstellar” humanity that will help us to go beyond the fragility of our lives on earth. As the days pass and we face new global crises like climate crises, conflicts, pandemics, etc., the prospect of expanding beyond earth seems like a better option to many elites.

However, the elites initially belonged to the public sector and were funded by national states. No private sector was responsible for space exploration because it was thought to be an area of national interest. When the Soviet Union launched its Sputnik satellite in 1957, the U.S. government felt a new sense of insecurity. So, they decided to transform the National Advisory Committee for Aeronautics and build a more expensive and bigger institution called the National Aeronautics and Space Administration. The rivalry between the former U.S.S.R and U.S.A. has changed the whole game. The launch of Sputnik was a surprise for everyone- the first man-made object that made it to space. However, it wasn’t a pleasant one for the U.S.A. because space was the next frontier, and it was crucial not to lose too much ground to U.S.S.R. But to its dismay, the former U.S.S.R advanced a few steps further by sending the first human into space. In April 1961, Soviet cosmonaut Yuri Gagarin became the first human to orbit the earth in the spacecraft Vostok 1. One month later, America sent its first astronaut into space. Desperate to win the ‘space war,’ President John F. Kennedy boldly claimed that America would land a man on the moon before the decade’s end. From 1961 to 1964, NASA’s budget was increased by 500 percent. 34,000 NASA employees and 375,000 industrial and university contractors were involved in the lunar-landing program. Things were not going well on the other side of the iron curtain. After the untimely death of Sergey Korolyov in 1966, the Soviet lunar-landing program was proceeding tentatively. On July 16, 1969, NASA’s Apollo 11 set off to do what human beings have been imagining for decades, what Jules Verne and H.G. Wells wrote fiction about. They were set off to land on the moon.

Neil Armstrong, Edwin “Buzz” Aldrin, and Michael Collins successfully landed on the moon on July 20, 1969. After becoming the first man to walk on the moon, Neil Armstrong famously recalled the moment by saying, “one small step for man, one giant leap for mankind.” With that, the U.S.A won the so-called ‘space war.’ Former U.S.S.R’s attempt at lunar landing was met with catastrophic events like the explosion in1969. In the post-Cold War era, the U.S.A and the Soviets came together to make the whole space exploration process more united and sustainable. In 1975, the famous “handshake in space” during the joint Apollo-Soyuz mission signified a new era in space exploration, an era where the goals related to space were more inclusive and international in nature.

Today’s space scene is very different from what it was during the Cold War. Space strategy is no longer about getting leverage over another country or national security. Space has become commercialized and, as a result, privatized. It is now the next commercial frontier. But how did it go from a nationalized sector to a privatized one? One thing that can be attributed to such a turn of events is the lack of national competition. After the Cold War, the U.S. had no incentive to compete and further develop its space program. Moreover, the huge budget that NASA had during the ‘space war’ era was becoming unbearable, and the public sector did not see any use for such a high budget anymore. Naturally, the space program became stagnant. Buzz Aldrin said, “After the Apollo lunar missions, America lost its love of space—there was no concentrated follow-up and we didn’t have any clear objectives” (as quoted in Sunyer 2014). This centralized approach to the space programs stunted the overall growth. Liberal economists explained this phenomenon in terms of the market. They visioned space as any other market system and identified the vulnerabilities of a state-controlled market system, such as weak incentives for the efficient allocation of resources, resistance to innovation due to reduced competition, etc. After NASA’s shuttle program failed and they were unable to find any replacement for the program for thirty years, it was clear that NASA was losing its grip and several private space companies and start-ups emerged to fill the gap.

The decentralized set of space companies is generally known as the ‘New Space.’ Jeff Bezos’s Blue Origin and Elon Musk’s SpaceX are the most famous private space companies. There are different types of private companies working actively towards the commercialization of space. The ‘space access’ companies focus on launching people into space. The ‘remote sensing’ companies provide images of the earth, and the ‘habitats and space station’ companies offer secure facilities for manufacturing, research, and even tourism in the low Earth orbit. The ‘beyond low earth orbit’ companies have purposes ranging from manufacturing to asteroid mining to colonization of the moon and mars.

All these ambitious projects would not have been possible if one thing was not playing a huge role, and that is capitalism. Capitalism is rapidly increasing consumerism which eventually leads to the commodification of space. However, it will be wrong to assume that billionaires like Elon Musk or Jeff Bezos are responsible for commodifying space. Space has always been a commodity, either as an object of fiction or pop culture. Humans have always commodified space, but for the first time, they have the resources to physically explore it and utilize the vastness it offers. That’s why today’s space economy is a 450-billion-dollar ecosystem we all interact with daily. But with great power comes great responsibility. The need to be more mindful about utilizing space is evident with the ever-growing debris in orbit. Space debris is a problem that can increase further with space tourism, and it is expected to expand rapidly, just like commercial air travel. And it is likely to grow on the whimsy of the billionaires.

– Nayeema Nusrat Arora

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