Government Gatekeepers

Two news items today focus on the “privatization” of government space resources – parts of the ISS and Cape Canaveral.

I feel like these developments fall into the category of “actions that have a label that sounds good in principle, but doesn’t really have a benefit in practice.” It’s similar to making things more “natural” without any actual additional benefits.

Why do I say this? Aren’t assets run by private entities more efficient and incentivized than those in the public sector? Well yes, if they are actually subject to a market.

Unfortunately, in both of these cases, the assets are still de facto run by the government because the government will still choose the private companies that will get to play the game. So while the internal workings might become slightly more efficient, the actual incentives for the company will still be formed by government overseers (bureaucrats and elected officials) rather than the market, thus avoiding most of the benefits of true privatization. To draw the analogy to food again, it’s like how there is no real nutritional benefit to “all natural” white bread (which I’m not sure is a real thing, but you get the point.)

The bigger picture is that in many cases, one needs to be wary of good-sounding labels. Something may technically qualify for the label, but provide very little of its connotations.

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