A Twinkle of hope: Obama has moved space policy in the right direction, but we still have a long way to go.

• Author: Simberg, Rand
• Position: President Barack Obama

BY ANY REASONABLY objective measure, U.S. human space-flight policy is an awful mess. We have spent hundreds of billions of federal taxpayer dollars during the last half-century, with little to show for it in terms of significant human expansion off the planet. In some ways, we have gone backward.

The United States sent a dozen people to the surface of the moon more than four decades ago, at horrific cost. Next December it will be 40 years since the last man kicked up the dusty lunar regolith, with only a few hundred people going into space in the ensuing four decades, at an average cost of about $1 billion each. We have spent $100 billion to deploy a space station that we cannot support without purchasing rides and lifeboat services from the once-feared Russians, who have accordingly been jacking up the price. Every time the National Aeronautics and Space Administration (NASA) renews the ferrying contract, Congress must waive the Iran/North Korea/Syria Non-Proliferation Act, which bans purchases of goods or services from countries who aid any of those countries in developing missiles or nuclear weapons, since Moscow continues to help Iran do both.

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There are near-term, cost-effective solutions to our space problems, but the people who guide policy in Congress aren't interested in them, insisting instead on pouring further tens of billions into a giant rocket that probably will never fly and that internal NASA documents show is unneeded. Maintaining existing aerospace jobs-"the seen" in Frederic Bastiat's famous formulation--trumps the unseen jobs and wealth that won't be created due to the forced misallocation of resources. And none of this gets us any closer to the moon or Mars.

Whether the federal government should be sending humans into space at all is a legitimate question, but not for the purposes of this article. Instead, our question is this: Given that human expansion into space is a good thing for both preservation of the species and for the future of freedom, what federal policies would best accelerate that outcome in a market-oriented fashion and at a reasonable cost to the taxpayer?

Space Policy Takes a Wrong Turn

To answer that question, we have to diagnose the problem by examining the historical roots of current policy dysfunction. Human spaceflight in America got off on the wrong foot, born as it was in the national Cold War panic over Sputnik and the space race with the Soviet Union. In our rush to beat the godless commies, instead of focusing on the steady long-term establishment of a competitive launch industry that would eventually make spaceflight affordable, Americans used unreliable ballistic missiles to transport people into orbit. With the "success" of Apollo, false lessons were cemented into place. We achieved John F. Kennedy's goal of landing a man on the moon and returning him to Earth before the decade was done, but in doing so we created a space policy monster.

The problem is that sending people into space was an urgent national priority for a decade at most. Since the late 1960S, it has no longer been a pressing issue for most people or their elected representatives. The spending persists because Americans have a vague sense that it is important to have a space program, but few can articulate why. The result is policy inertia: Since NASA has always sent people into space (as far as Americans with limited historical knowledge are concerned), and no one else has done it, NASA must always send people into space, even if in reality the agency fails at even that.

This mind-set helps explain the overreaction to the Obama administration's 2009 announcement that it would pay commercial providers to get astronauts into Earth orbit so that NASA could focus on getting them beyond Earth orbit. When the sense that the United States should rule space combined with partisan revulsion at Obama, the result was unhinged commentary about "the end of American human spaceflight" and other canards.

There was a third, more powerful source of pushback against the new policy, one that shouldn't surprise anyone familiar with the economic theory of public choice. President Dwight Eisenhower famously warned the American public about the military-industrial complex. Less familiar is the Apollo-born iron triangle of the human spaceflight industry, NASA, and Congress, an arrangement that has lived on through the space shuttle and space station programs.

The model was that NASA would dictate requirements and design, then hire contractors to develop, test, and operate the system. This would be accomplished via cost-plus contracts, in which bidders were reimbursed for labor and materials, with a fixed fee for profit, plus overhead that funded...