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the Space Shuttle if we cannot undertake any of the large space projects for which the Space Shuttle was designed and is capable of supporting? The Space Shuttle system can place thirty-two tons of payload into near-earth orbit every week. The next time a big semi-trailer rig passes you on the highway, think of the fact that the Space Shuttle can put the whole rig tractor, trailer, and load into orbit with room and weight margins to spare. And do it every Thursday morning.
Other government policies are discouraging domestic industry from initial participation in space utilization. Domestic industry operates with a security system that far outstrips anything the federal government uses because domestic industry has plans, programs, and proprietary information existing in a highly competetive operation. Macy's doesn't tell Gimbel's, and that's not a joke but a fact. The only restriction that should be placed upon a Space Shuttle payload is the same sort of restriction that is placed upon any shipment by a common carrier. Nothing more. It's going to be an expensive payload to begin with, and the company paying the tab doesn't want to lose it any more than they want anything to happen with any earthbound shipment or activity.
Some government policies, rules, regulations, and laws also restrict or prohibit the necessary financial activities required for the concentration of the large amounts of capital anticipated.
Lest anyone believe that the policies of the federal government are the only impediments in the policy area, let me point out that some of the policies of individual companies in domestic industry may also be highly restrictive. For example, I am aware of one firm that will not undertake any new product development or introduction unless it has an excellent chance of showing a profit in the first year on the market. Most firms work with a longer period of time, and the average expected time for a return on investment is about 5 years. Some firms in good financial positions can afford to stretch this to 10 years. Obviously, when speaking of space industrialization products and services showing breakeven points 15 years in the future, most domestic firms will snort, "Buck Rogers stuff," and go do something else instead. In addition, most domestic firms have capitalization policies that will not permit them to consider such high-risk ventures as most space industrial activities now appear to be. Domestic industrial firms have well-established, well-proven, highlyrigorous, formally-structured review programs for proposed new ventures. In the absence of an absolute committment from top management, I seriously doubt whether most proposals for space industrial activities would survive these corporate venture reviews. The risks are too high and often unknown; the capital requirements are high; and the payoff seems to be too far in the future. While politicians must be responsive to their electorate, business people must be responsive to their
investors. Investors expect a return on their investment,
of the street.
Lastly, what organizations are available to work with to achieve space industrialization? Foremost in everyone's mind when the subject of space comes up is the National Aeronautics and Space Administration, NASA was established as a result of the National Aeronautics and Space Act of 1958 (Public Law 85-568), primarily to conduct the exploration of space. Since that time, it appears to be evolving into an operating agency. Fifteen of the twenty-five satellites to be launched by NASA in 1978 are reimbursible operations. NASA is on a tight budget. Is it doing what it supposed to be doing according to Public Law 85-568? Is it spreading itself too thin in an attempt to become an operating agency and thereby perhaps insure its survival? Perhaps some of the other witnesses can answer these questions. Perhaps it is time to review Public Law 85-568 and subsequent laws and executive orders.
In addition, we now find a plethora of government agencies, bureaus, offices, and departments involved in some aspect of space activity. Some have jurisdictions that overlap those of other organizations. This is a welter of confusion to domestic industry when they want to look into the possibility
of becoming involved in space industrialization.
The organizational structure of domestic industry is also extensive and complex. There are literally thousands of companies, corporations, conglomerates, syndicates, partnerships, holding companies, investment firms, and other types of financial, marketing, sales, production, development, and service businesses. Some of these are loosely banded together into trade organizations. Many operate powerful lobbying activities in Washington and state capitals. The variety of business organizations in the United States alone is staggering. One needs only to spend a few minutes glancing through the U.S. Department of Commerce "Standard Industrial Classification Manual."
But we appear to have in the United States the necessary government and industrial infrastructures that can both support and require space industrialization and that can utilize and benefit from the output of space industrialization. A nation of farmers and herders doesn't have that infrastructure, but can benefit from space industrialization because the
products and services are exportable.
This assesssment indicates that the United States has
the hardware to begin activities in space industrialization on a greater and broader level of activity than now in existence
or planned. It also shows that we are rapidly developing
technologies that will lead to even greater utilization of
space in the next ten years. It also reveals that there may have to be some changes in policies and organizations if we are to be able to do what we can do.
But why should it be done at all? Why shouldn't the United States simply continue a space program primarily characterized by scientific exploration, supported by tax revenues from other sources, and operating with less than one percent of the federal budget?
Report of a Recent Study
It appears that an active, innovative, progressive, and stimulative space industrialization commitment may well create a space program that will not only pay for itself but will also enjoy public support because of its potential for creating new jobs, new capital resources, new technology, new products, and new services.
I have been studying space industrialization for over five years. Others have been involved longer. But for the past sixteen months, I have been part of a team of consultants working for Science Applications, Inc. on a study contract about space industrialization for the NASA Marshall Space Flight Center. The primary people involved in the study and their fields of expertise were: