Necessity and Incentives

Opening the Space Frontier

Testimony before the House Subcommittee on Space

by James Bowery, Chairman

Coalition for Science and Commerce

July 31, 1991

Mr. Chairman and Distinguished Members of the Subcommittee:

I am James Bowery, Chairman of the Coalition for Science and Commerce. We greatly appreciate the opportunity to address the subcommittee on the critical and historic topic of commercial incentives to open the space frontier.

The Coalition for Science and Commerce is a grassroots network of citizen activists supporting greater public funding for diversified scientific research and greater private funding for proprietary technology and services. We believe these are mutually reinforcing policies which have been violated to the detriment of civilization. We believe in the constitutional provision of patents of invention and that the principles of free enterprise pertain to intellectual property. We therefore see technology development as a private sector responsibility. We also recognize that scientific knowledge is our common heritage and is therefore a proper function of government. We oppose government programs that remove procurement authority from scientists, supposedly in service of them. Rather we support the inclusion, on a per-grant basis, of all funding needed to purchase the use of needed goods and services, thereby creating a scientist-driven market for commercial high technology and services. We also oppose government subsidy of technology development. Rather we support legislation and policies that motivate the intelligent investment of private risk capital in the creation of commercially viable intellectual property.

In 1990, after a 3 year effort with Congressman Ron Packard (CA) and a bipartisan team of Congressional leaders, we succeeded in passing the Launch Services Purchase Act of 1990, a law which requires NASA to procure launch services in a commercially reasonable manner from the private sector. The lobbying effort for this legislation came totally from taxpaying citizens acting in their home districts without a direct financial stake -- the kind of political intended by our country's founders, but now rarely seen in America.

We ask citizens who work with us for the most valuable thing they can contribute: The voluntary and targeted investment of time, energy and resources in specific issues and positions which they support as taxpaying citizens of the United States. There is no collective action, no slush-fund and no bureaucracy within the Coalition: Only citizens encouraging each other to make the necessary sacrifices to participate in the political process, which is their birthright and duty as Americans. We are working to give interested taxpayers a voice that can be heard above the din of lobbyists who seek ever increasing government funding for their clients.

Introduction

Americans need a frontier, not a program.

Incentives open frontiers, not plans.

If this Subcommittee hears no other message through the barrage of studies, projections and policy recommendations, it must hear this message. A reformed space policy focused on opening the space frontier through commercial incentives will make all the difference to our future as a world, a nation and as individuals.

Americans Need a Frontier

When Neil Armstrong stepped foot on the moon, we won the "space race" against the Soviets and entered two decades of diminished expectations.

The Apollo program elicited something deep within Americans. Something almost primal. Apollo was President Kennedy's "New Frontier." But when Americans found it was terminated as nothing more than a Cold War contest, we felt betrayed in ways we are still unable to articulate -- betrayed right down to our pioneering souls. The result is that Americans will never again truly believe in government space programs and plans.

Without a frontier, for the past two decades, Americans have operated under the inevitable conclusion that land, raw materials and wealth itself are fundamentally limited and therefore to be hoarded and controlled -- rather than created. Out of this post-Apollo mentality, a deeply rooted cynicism has led young people into careers as lawyers and financial manipulators rather than farmers, inventors and engineers. It has led to an environmental movement which loathes humanity's natural capacity to transform hostile environments with technology. It has led to cartels, wars over energy and a devastatingly expensive arms race. It has led businesses and investors to remain averse to high risk technology development even as they issue billions in high risk debt vehicles for corporate take-overs. It has led to a preference for real estate speculation over job creating investments, making it nearly impossible for most of those born in the mid-to-late baby boom of the 1950s to establish stable careers, homesteads and equity for retirement, even with two incomes.

In short, the lack of a frontier is leading us away from the progressive values of the Age of Enlightenment, upon which our country was founded, and back to the stagnant feudalistic values of the middle ages. We look to the Japanese for cultural leadership. We forget the rule of law and submit to the rule of bureaucracy, both corporate and governmental; for in a world without frontiers, the future belongs to the bureaucrat, not the pioneer.

No where is this failure of vision more apparent than in our space program where the laws of human nature and politics have overcome the laws of nature and the space frontier as in "Take off your engineering hat and put on your management hat."

First Apollo failed us. Then the shuttle raised and dashed our hopes by failing to provide easy access to space. We now look forward to the proposed space station as the last vestige of a dying dream written of by Werner Von Braun in Collier's magazine during the 1950's, even as its costs skyrocket and its capabilities dwindle into a symbolic gesture of lost greatness.

The pioneering of frontiers is antithetical to bureaucracy and politics. The greatest incentive for opening frontiers is to escape from calcifying institutions. We betray our deepest values when we give ownership of our only frontier to such institutions.

Therefore, these hearings on incentives to open the space frontier are among the most hopeful events in recent history. Those responsible for holding these hearings and acting to create pioneering incentives to finally open the space frontier, are to be commended for their insight, courage and leadership. They are earning for themselves and our entire civilization a place of honor in history.

Incentives Open Frontiers

Over the past few years the Coalition has worked with Congressman Ron Packard and a broad spectrum of other Congressional leaders to introduce and pass a bill providing the most significant incentive for opening the space frontier to date: The Launch Services Purchase Act of 1990. Similar to the Kelly Act of 1925, which created incentives for pioneering aviation, the LSPA seeks to synthesize a commercially reasonable market from existing government demand for launch services. Lowering the cost of access to space through incentives for commercial competition is the most important goal in our space policy because launch costs dominate all others.

Although extensively amended from its original language, the LSPA remains a symbol of pioneering spirit, democracy in action and American values in the one place it counts the most: The Space Frontier.

Congressman Bob Walker's Omnibus Space Commercialization Act of 1991 contains two important provisions which will expand and empower the incentives of the LSPA. The first provision is the return of language in the LSPA to cover the Department of Defense as well as NASA, and to cover all space transportation, not just orbital launch. The second is the substantial funding authorization for launch and payload integration service vouchers under the Department of Transportation. The independence of the Department of Transportation's Office of Commercial Space Transportation creates exactly the kind of checks needed to avoid conflicts of interest. Private investors can trust their capital with such carefully constructed incentives.

Another important provision of the Omnibus Space Commercialization Act is the encouragement of many Federal agencies to participate in space activities. Such variety of funding sources further inhibits the politicization of space by replacing political competition for centralized programmatic control with incentives for performance in technical and commercial competition.

These incentives are helping to open the space frontier because they discriminate on the basis of actual achievement rather than political savvy and psychological appeal. By acting as a market instead of a monopsony or as a source of capital, government funding ceases to control or compete with the initiatives of our citizenry. Instead government rewards viable citizen initiatives with the profits needed to further capitalize space services, while punishing failed management and technology with bankruptcy; conditions virtually impossible to replicate within the space paradigm of the past.

Profit and bankruptcy are as essential to technical progress as mutation and selection are to biological evolution. They are the "invisible hand" that guide private investors to create viable solutions to our needs. Just as mutation and selection led life from water onto dry land, so profit and bankruptcy will remove the earthly limits on life and open to life the limitless ecological range of space.

Distribution of funding in peer-reviewed grants to scientists which patronize commercially competitive companies not only utilizes market forces to optimize infrastructure design and operations, but it also spreads space dollars out to all Congressional districts without multi-year authorizations, technical prejudice or political gamesmanship. This apolitical cashflow creates commercial incentives and it builds solid justifications for the use of our space dollars with a hard-core nation-wide constituency.

But robust justifications and hard-core political constituency pale in significance when compared the explosive energy of Americans challenged by the incentives and freedoms of a frontier.

Americans can best be challenged by the following policy measures:

* Distribute space funding to multiple independent agencies for the funding of unsolicited scientific proposals.

* Require that the experiments be designed to fly on existing commercial services.

* Expose the proposals to review by a patent examiner to ensure the work is genuine science, as defined under intellectual property laws, and therefore not in competition with private sector technology development.

* Require that the principle investigator make the primary procurement decisions free from Federal Acquisition Regulations.

* Minimize abuses and avoid multiyear authorization by keeping grants relatively small.

* As commercial companies establish space operations, support their property rights.

Comprehensive legislative language drafted for discussion by Dr. Andrew Cutler details many of the Coalition's ideas on procurement, property rights and transitional policies. This legislative language is available on request.

Stated simply:

Fly lots of scientific missions using commercial services. Base them on fresh ideas. Let unfashionable ideas find funding. Decentralize procurement decisions. Avoid competition with the private sector by focusing on research rather than development. Enforce new property rights in space as they are defined.

Give Americans a challenge and trust them to react with the resourcefulness and courage of our ancestors who risked everything to cross the oceans to settle a hostile continent. We won't disappoint you.

Conclusion

The space frontier is a hostile environment with unlimited potential that demands our best. We can meet such a challenge only with the strength of our traditional American values -- values uniquely adapted to opening frontiers.

This Subcommittee is in a position of great privilege. The next millennium could witness the restoration of Earth's environment and the transformation of space into an new kind of ecological range, virtually limitless in its extent and diversity. Those creating the incentives that open the space frontier now will be responsible for the fulfillment of this vision which appears to be the ultimate destiny of Western Civilization's progressive tradition.