Space, the next frontier for capitalism
Investment bank Goldman Sachs estimates that space start-ups have, globally, attracted $13.3 billion of investment since 2010
Jeff Bezos, the richest man on earth, has said that he has been funding his space technology firm Blue Origin at the rate of $1 billion a year and will continue to pump in his “Amazon lottery winnings into a much lower price of admission so we can go explore the solar system.” He can afford it — with a net worth of $131 billion, he is richer than two-thirds of the countries of the world. And, along with Elon Musk, the founder of SpaceX, he is the face of the next giant leap of capitalism — into space.
Science fiction predicted most of humanity’s technological advancements — from submarines to television, from rockets to robots. But even the most clairvoyant of sci-fi authors failed to foresee that planet earth would lose interest in manned space exploration after putting a man on the moon. The space race of the 1950s and 1960s had a grandiose political purpose. When that battle had been settled, placing communication satellites in orbit became by far the major activity. Yes, space shuttles were launched, an International Space Station (ISS) is up there, but this was hardly space exploration. The US National Aeronautics and Space Administration’s (NASA) budget, in constant 2014 dollar terms, peaked at $43.6 billion in 1966; it was $18.9 billion in 2017.
There were huge potential pay-offs — the obvious one being mining minerals on asteroids and other planets, but to governments, the returns on investments were too far-off to commit the massive upfront cash outlays. And thus it stayed for 40 years, till a new breed of capitalists emerged — whose dreams sought frontiers beyond earth. “Our planet is finite,” Bezos has said.
The turning point was the retirement of the space shuttle in 2011. As a result, NASA awarded billions of dollars of contracts to private companies to carry astronauts and cargo to the ISS. The industry suddenly bloomed; there are more than a thousand space companies in the US today. Investment bank Goldman Sachs estimates that space start-ups have, globally, attracted $13.3 billion of investment since 2010.
In 2015, President Barack Obama signed the US Commercial Space Launch Competitive Act into law, guaranteeing private companies rights to own, sell and profit from resources extracted from asteroids and other “celestial bodies”. In August 2017, Luxembourg became the first European country that officially allows space resources to be “appropriated” by commercial groups based in the country. Many companies have since then set up shop in Luxembourg.
Bezos’ Blue Origin has successfully launched and landed several sub-orbital flights. In February this year, SpaceX launched Falcon Heavy into orbit around the sun. The company is aiming to have manned flights by the end of the year, and says that Big Falcon Rocket (BFR), its spaceship for interplanetary travel that may carry up to 100 passengers, will be ready in 2019.
Meanwhile, Bigelow Aerospace, owned by Robert Bigelow, who made his billions from his budget hotel chain, plans to set up hotels that will orbit earth. Among start-ups that are focused on space mining, Planetary Resources points out that just one little near-earth asteroid called 3554 Anum has $8 trillion worth of platinum reserves, while our current annual output is $12 billion, of which 88% comes from three mines in South Africa.
The 1967 UN Outer Space Treaty avers that “outer space, including the Moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means”. So, if a country lays claim to territory on Venus, it would be breaching international law on earth, which could lead to some nasty stand-offs. But the UN treaty is silent about private ownership. Musk has clearly stated that his objective is to set up colonies on Mars, and the BFR is the first step towards this. So, is what Musk is doing legal? But then, the history of capitalism is about finding loopholes in, working ways around, bending and reshaping laws. There’s no reason why the next stage of the capitalist’s progress will be any different.
Sandipan Deb is editorial director, swarajyamag.com
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