NASA developing lunar landers with Elon Musk’s SpaceX and Jeff Bezos’s Blue Origin shows how quickly space exploration has become dependent on just a couple of billionaires. As the U.S. space enterprise has become increasingly dependent on private sector investment, the sector has skyrocketed from where it was a decade ago.
When journalist Chris Davenport began covering the early days of the commercial space race as a daily reporter for The Washington Post, he saw that “the private sector eroding the decades-long monopoly that governments held on space exploration” was paradigm-shifting.
“We're going to look back on this era 30, 40, 50 years from now and see it as a historic time,” Davenport said.
Speaking with Institutional Investor in March ahead of his interview with Retired General John “Jay” Raymond at II’s public funds roundtable in April, Davenport discussed how the space race has escalated and evolved since first covering the topic, how the partnership between the private sector benefits the government — and space travel — and the possible dangers of having the future of space travel in the hands of a few individuals like Elon Musk and Richard Branson.
The following interview has been edited for length and clarity.
Institutional Investor: One of the big things I want to ask is where we are in the space race now. But let's go back a bit: Tell me about your story and how your book, Rocket Dreams, came to be.
Chris Davenport: Yeah, so Rocket Dreams is a sequel to an earlier book that I wrote called The Space Barons that chronicled the early days of Elon Musk's SpaceX and Jeff Bezos's Blue Origin. In those days, I was also writing about Richard Branson and Virgin Galactic and really the beginning of the commercial space age where you've got the private sector eroding the decades-long monopoly that governments held on space exploration.
I had thought that there may be enough material for a second book 10 years or so after The Space Barons was published. That was in 2018, and little did I know, there's so much that's happening so fast that I looked up and was like, ‘Oh my gosh, I've already got enough material here for a second book!’
At the time I was a reporter at the Washington Post covering this golden age of space exploration as Jeff Bezos calls it, or the new space age or space 2.0, and I felt like it really transcended what I was doing at my day job and as a daily journalist and that we're going to look back on this era 30, 40, 50 years from now and see it as a historic time.
Now tell me a little bit more about this historic time we’re living in now.
Anytime the government entrusts its most valuable resource, its astronauts, to be flown by the private sector, I think that's a paradigm shift. Right now, NASA doesn't own the rockets or the spacecraft that flies its astronauts to the International Space Station: Right now, SpaceX does that as a service for NASA. I mean, the space shuttle retired in 2011 and NASA kind of got out of the human spaceflight business as the sole proprietor of that and decided that they could rely on contractors.
In addition to that, we're at a moment now where it's moving even faster: We've got NASA's Artemis program, a return to the moon. We're in a space race with China. The commercial sector is embedded in that program as well. You're seeing the advent of the Space Force, which is also pushing the technology and seeing all kinds of new investment coming into the space industry.
And what is that leading to? We're seeing a lot of private investment into the space industry, but we're now in a short- to medium-term profits mindset. The government isn't trying to make a for-profit endeavor when it, say, tries to go to Mars, but you know Bezos and Musk do. So how does that private investment factor into it?
It depends on the company. Bezos and Blue Origin are at the point where they want to start seeing a return on their investment. And by Blue Origin’s investment, it's really Jeff Bezos's investment. He famously said he was going to put a billion dollars a year into Blue Origin and for years didn't see much of a return on that at all. Whereas SpaceX quickly was taking private investment and leveraging that to get government contracts to get real revenue from the government to build the Falcon 9 and now Starship rocket and the Dragon spacecraft and then use that to pivot to the commercial sector.
In addition to launching commercial satellites for a number of companies, obviously one of the main drivers for SpaceX is Starlink. Creating the Internet in space has been a huge business: It changes the way we actually think about SpaceX and think about the industry as a whole. SpaceX is no longer just a rocket and spacecraft company, they're an Internet provider. And you're seeing Blue Origin getting into that business as well and putting up many, many tens of thousands of satellites that would be flooded to low Earth orbit. That has changed the paradigm.
Forgive me if I'm misinterpreting this, the title of your first book implies that Bezos and Musk are the modern-day equivalent robber barons. Am I reading that right?
Davenport: They would not see themselves as the robber barons. They would see themselves as the opposite — that what they're doing is for the public good; that opening up space to the masses, making space accessible, would ultimately be a good thing.
Bezos talks about it in terms of the advent of the Internet and the economic dynamism that the Internet allows. He says the difference is that at the beginning of the Internet, like the infrastructure was there so that he could build Amazon on top of that infrastructure. So, for example, the phone companies had laid down the cable lines that allowed for the Internet was his Postal Service, so he could deliver the books to people's houses. There was, as he says, this invention called the credit card, so he could take people's money so he could essentially start a company like Amazon on the back of that infrastructure. And anybody could start an Internet company out of their dorm room.
But you can't do that today in space. The infrastructure isn't there. So, what they want to do is build that infrastructure.
There's obviously a rivalry between Jeff and Elon, between Blue Origin and SpaceX, and you see them poking each other. But the fact of the matter is there's so much in terms of their thinking that is alike: they both want to lower the cost of access to space, make it accessible, and help open up space, not just to human exploration and science and discovery, but also to economics — and seeing an economic dynamism that Jeff says he saw with the advent of the Internet and building the railroad to get there.
And because we're talking about a bunch of things, when you say railroad, are we talking about space tourism, better Internet connectivity, or all of it?
Yep, all of it.
Ten years ago, we were launching as many as 10 or 12 rockets a year from the United States and that was it. Now you see SpaceX launching a rocket every two days or so. It's just getting good at accessing space, bringing down launch costs. It used to be if you're only launching 8 to 10 rockets a year, the satellites would have to stay up there for 20 years. Now if you want to put up a new satellite, it's no big deal: You just send up another rocket. It doesn't cost that much.
Instead of these big, exquisite satellites that are the size of a school bus, you can put satellites up that are the size of a loaf of bread, and if they fail or deorbit, no big deal. You put up more satellites.
And so you're seeing that paradigm fundamentally shift with more increased access, whether it's through space tourism or putting up these large constellations of satellites.
You mentioned that NASA is no longer in the business of taking astronauts into space and it's now in the hands of, say, people like Elon Musk. Is there a danger here? Do you see a downside there at all?
Yeah, and let's be clear: NASA has outsourced human spaceflight to the private sector but still has enormous insight and oversight into their rockets and spacecraft. They are under contract with NASA. They've got to meet the requirements that NASA sets. If there is a mishap, NASA will look into that and help them investigate and they train the astronauts and they work alongside SpaceX and the other companies.
But yes, astutely, NASA is not in the business of profit or making money: It's in the business of exploration and discovery. And these companies are companies: They're beholden to shareholders and the bottom line. So, there is a divergence in motivation and what the results need to be.
We saw this come into very stark relief last year when Musk and Donald Trump had their little break up. And Musk threatened to take away SpaceX's Dragon spacecraft from NASA, and that would leave NASA, the United States government, without any way to fly American astronauts anywhere. It would basically cut off the United States government from accessing the International Space Station.
This national treasure that's that taxpayers have funded to the tune of $100 billion. So yes, you can see clearly some of the downsides of putting so much of the national space enterprise into the hands of the private sector. And really what we're talking about here is not into the hands of the widespread industry, but in some aspects, like human spaceflight, it's in the hands really of one company and one man: Elon Musk.
That said, there are some upsides. I mean, Elon and SpaceX have revolutionized launch. They've brought down the cost. They've pushed new technologies like reusable rockets and have shown that they can fly safely and efficiently and have had enormous success and are frankly, I think one of, you know, the best success stories.
In the history of American, you know, entrepreneurship in the last 100 years. That said, I think even Elon Musk would say in order for them to really be successful, they need more competition. The government needs more options so that it doesn't have to rely so heavily on just one company.
You're interviewing retired General John “Jay” Raymond at our upcoming public funds roundtable in April. I’m curious what you two plan to discuss. Could you give us a teaser?
I think that the Space Force is one of the least understood branches of the military. Obviously, it's the newest branch of the military. It's only six years old. It's the first new service to join the armed forces since the Air Force in 1947. And I don't think people understand what the Space Force does, what it is.
But the fact of the matter is that the threats in space are real and the Space Force is vital. I mean, even as we see what's happening in Iran and the United States having air superiority in the skies over the Middle East, that is enabled in large part by what the Space Force does.
Being able to sort of jam communications and create safe corridors for American assets to be deployed into space. If you think of just the importance of space, what the threats are, you know, one things I point to is GPS and we think of GPS as a layperson as Google Maps or Waze or DoorDash — that little blue dot on your phone that tells you where you are. But a key part of GPS isn't just the navigation, it's the timing. And there are actually atomic clocks on these GPS satellites that are used in every banking transaction trades on the New York Stock Exchange.
And they're really only 31 GPS satellites. And if they're vulnerable, the signal is vulnerable. GPS is jammed every single day in conflict zones. And if an adversary were to take out, you know, our ability to have that precise navigation and timing, it not only disrupts what the military can do.
But it could create havoc within the United States financial system because again, we rely on that timing signal for all of these banking transactions.
