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With China, Russia looming, SpaceX launch is about more than Mars

With China, Russia looming, SpaceX launch is about more than Mars
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SpaceX has reached another milestone with the successful launch of Falcon Heavy. The launch is another example of the organization’s persistent ability to innovate and push market expansion. 

In the short term, the launch probably won’t add to SpaceX’s bottom line all that much, there just isn’t enough heavy lift demand. So why is the launch such a big deal? The importance of Tuesday’s maiden Falcon Heavy flight is less about the immediate financial return for SpaceX and more about what it signifies vis-à-vis America’s interest in space and the country’s ability to leverage the free market system to develop the burgeoning space domain ahead of our peers.

Maintaining America’s advantage in space has both economic and national security implications.

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The economic importance of outer space is increasing. Advances in computing, miniaturization, telecommunications, and a persistent, global drive to advance state security, science, and human exploration are converging to elevating the value of outer space for both governments and the private sector. Importantly, the amount of public and private sector financing for space programs increases dramatically after technology has been demonstrated. The cost and complexity of demonstrating new, revolutionary space launch, satellites, and other critical systems means any new demonstration will have larger economic influence.

 

Current predictions suggest the space industry will grow from $350 billion today to $2.7 trillion over the next three decades. Satellites, and the services they provide, represent $260 billion of the total global space economy. There are presently 1,738 operation satellites on orbit spread across 64 countries. The majority of which are owned and operated by the United States (803), China (204), and Russia (142), with the remaining 61 countries operating 589 satellites combined. This number will grow dramatically as more than 6000 small satellites are launched in the next decade providing a host of additional services and market growth.

Accounting for the largest commercial space activities, the United States holds significant market share compared to other countries, but this may not last. Scientific literature (a barometer for measuring knowledge production and innovation in a specific field) on space has steadily increased around the world. As of 2014, the United States produced the most, writing almost double, compared to China the next largest contributor. China’s production jumped by a factor of ten between 2000 and 2014, however. Chinese state media has reported that the country’s goal is to capture 10 percent of the commercial space industry by 2020, up 7 percent from where they are currently. More broadly, China has released a report outlining goals that would secure its position as a major space power. Russia has also set a 2020 deadline for modernizing and expanding their efforts in space.

The economics of space aren’t the only concern. Military operations are increasingly dependent upon satellites which provide imagery, communications, navigation, and early warning. Complicating things further is the political gray-zone that ensues when militaries become consumers of commercial space services. Both Russia and China are placing a significant emphasis on the military value of space for both offensive and defensive purposes. Meanwhile U.S. military leaders continue to emphasize the need for space superiority.

It is important to distinguish the difference between what a state says and what it does. Both China and Russia have exhibited an ability to attack space-based systems. It would probably also be a safe bet to assume they have additional military tools the United States or our allies are unaware of. But China and Russia centralize a lot of the critical technology development related to space, making demonstrations necessary for stimulating commercial investment rare.

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Russia’s space program is all but in shambles, and while Russia has suggested their efforts in space will continue to progress, it remains to be seen what the state can actually support. China continues to have problems with its heavy lift Long March rocket and its commercial space launch industry is only three years old. This isn’t to say U.S. investors or policymakers shouldn’t consider Russia and China to be strategic competitors in space. It is to say, however, that the United States continues to demonstrate an incredible aptitude for advancing commercial and national security space compared to either competitor; the opportunity shouldn’t be wasted.

The United States should praise SpaceX for being another example of American ingenuity and originality. Policymakers should continue to provide regulatory reform and economic incentive to further commercial space efforts while at the same time taking deadly serious the national security implications that foreign investments in space can present. $2.3 trillion in market value and military operability depend upon it.

Adam Routh is a research associate with the Defense Strategies and Assessments Program at the Center for a New American Security where he focuses on national security space policy. He is also a former member of the Army’s 75th Ranger Regiment.