Is the space industry a valuable investment?

Is the space industry a valuable investment? Should we be investing more in space infrastructure and the exploration of space or should we focus our resources on humanitarian issues such as global poverty and climate change?

This important issue concerns a variety of stakeholders including governments, businesses and the population as a whole and will be considered from a standpoint which strives to benefit as many people as possible.

Reduced Spend Argument

In 2014 the Russian Federal Space Agency’s budget totalled $4.88bn and more recently NASA was given a budget $700 million more than it requested; is it really acceptable to be increasing space exploration budgets in an age where half of global wealth is in the hands of a privileged 1%, whilst more than 2.1bn people live on less than $3.10 a day?

Governments have a choice in how their annual discretionary budget is distributed. Last year the US federal government allocated $18bn to NASA whilst only allocating $1.9bn to its Energy Efficiency and Renewable Energy Program. Climate change is a current global issue and clearly isn’t being made a high enough priority by one of the most influential countries in the world. The Environmental Justice Foundation reported that there will be 150 million ‘climate refugees’ in the next 40 years. The effects of climate change are already observable, for example melting of arctic sea ice. Despite this, one of the only budgetary shortfalls NASA saw last year was to its Earth Science division, tasked with researching our global climate system. Last year NASA spent $4bn on its Space Exploration programs whilst only $1.8bn was allocated to Earth Sciences. How is this excessive expenditure helping tackle current global issues?

In 2014 the US government spent $32bn on Official Development Assistance (ODA), this is a voluntary fund given by member states to aid poverty. This is only 0.19% of the USA’s gross national income, in contrast to the UK’s ODA contribution of 0.71%. The UK doesn’t invest as much in space exploration which provides more budgetary flexibility. If NASA’s exploration budget alone was redistributed to the ODA then US aid spending would increase by over 10%.

The redistribution of government funds can have huge effects on populations, especially those who are most vulnerable. Clearly, allocating funds away from the space industry will inevitably lead to jobs being lost, research being considerably slowed and one of the most fascinating forms of modern science being severely impacted. However, the extortionate spending associated with this industry cannot be justified when compared to the benefits this money could produce elsewhere. By significantly reducing investment in the space industry, governments could distribute funds to arguably more important causes such as welfare, education and healthcare. Space exploration and research could continue but not to the extent where it deprives those in need of important resources.

We live in an age where extreme poverty and wealth coincide on this planet. Is it right for governments to fund these incredibly expensive schemes whilst leaving the rest of the world to suffer? This is a question that must be asked as we move into a very uncertain future.

Increased Spend Argument

When people think of space, they tend to cast their minds to the moon landing and missions to distant planets – but that’s not all there is to it. The space industry has a huge influence on the lives of almost everyone; be it through satellites fulfilling daily communication needs or through advanced research generating impressive technologies.

In 2014, global space activity amounted to $330 billion, with less than 25% contributed by government space agencies.  Such a large investment from the private sector demonstrates that space programs are tangible investments and with improvements in technology, such programs are becoming increasingly affordable. With the space economy growing considerably, the share of the private sector is likely to increase further and it’s hoped that this progression will also benefit future government contributions.

The funding of space programmes has led to the development of technologies that are used regularly by almost everyone. Satellites play a vital role in our everyday life and are the basis behind almost all communication and earth monitoring systems. Without satellites, it would be impossible to monitor important humanitarian issues such as climate change and natural disasters, therefore leaving us potentially vulnerable to global crises. In addition to satellites, space programmes have provided us with numerous other technologies including memory foams, MRI and smoke detection, to name a few.

Global government spending is approximately $66.5 billion (compared to defence spending of $1563 billion) and includes space infrastructure, support and exploration. This funding generates a huge amount of jobs (120,000 people in OECD countries) and contributes to the development of highly skilled professionals – an important commodity for the generation of wealth. Compared to the private sector, governments contribute a larger proportion of funding towards exploration, a field which produces incredible scientific research into the nature of our universe.

The exploration of space has had a profound impact for generations and has inspired people of all backgrounds to pursue the answers to some of life’s greatest mysteries. Are we alone in the universe? How did it all begin? Will humanity ever leave Earth? These are some of the many questions that we are compelled to ask, and that space exploration aims to answer. Scientific exploration also brings about an immense level of national pride such as during the Cold War when the space race lifted the spirits of the people and encouraged collaboration between conflicting nations.

To conclude, it is advised that governments encourage private sector investment, subsidise humanitarian space efforts such as satellite launches and strive towards the improvement of space travel – hoping one day to identify new planets and forms of life in the universe. The inspiration generated by these actions will serve to motivate and educate young, inquisitive minds and help us work towards a greater future for humanity.

Do you believe government funding to the space industry should be increased or decreased? Let us know your thoughts in the comments section below.

27: Connor Black, Bradley Brick, Ed Shell, Connor McGregor

5 thoughts on “Is the space industry a valuable investment?

  1. The US military budget is around $600 bn… yes space funding is expensive as just a number, but compared to the other things that governments are spending money on, it would certainly NOT be the first item on the list to shift money away from.

    In the UK alone, the space industry contributed £5,147m to the GDP in 2012. It had an annual turnover £11.8bn and is growing at about 8% each year. This is an industry which kept on growing throughout the economic upsets in 2008. How many industries have done this? Space is no longer a toy for rich governments to play with. Modern humanity depends on satellite communication and Earth observation for weather, agriculture, surveying etc…

    In 2014, a study by the London Economics, commissioned by the UK government found:
    “Direct Gross Value Added of the space industry amounted to £4.8 billion in 2012/13, from a turnover of £11.3 billion. The UK space industry therefore contributes to UK GDP to a similar extent as passenger rail transport and motion picture production. In the analysis of Gross Value-Added, it is reasonable to include contribution beyond the direct contribution of the industry itself. Activity in the space industry requires inputs from the supply chain. For example manufacture of satellites requires intermediate inputs such as electronic subsystems, which might not be produced in the absence of space industry demand. The associated GVA of the supply chain is known as the Indirect GVA contribution of the space industry. Further to the indirect effect, employees in the space industry and supply chain spend their salaries in yet other sectors of the economy. Capturing these effects in the calculation is known as estimating the induced effects of the industry. In total, the UK space industry contributes £10.8 billion to UK GDP through direct (£4.8bn), indirect (£3.0bn) and induced (£3.0bn) effects.” – Executive Summary: The Size & Health of the UK Space Industry OCTOBER 2014

    In Europe, a similar story can be seen. For every euro invested in the European Space Agency by member states, six euros are generated as a return on investment.

    Budgetary shortfalls in Earth sciences at NASA are most likely due to the fact that the satellite industry is rapidly maturing with banks, telecommunication and other companies willing to invest. There is no need for a national space agency to do so any more, it is reaching a self sustaining stage when people all around the country recognise the value of space investment and its reliance on global systems such as GPS.

    Businesses and venture capitalists are increasingly investing in the space industry. It is not a money sucking machine that gives nothing but some “possible” new technology. It returns real hard money and capabilities for the country and its citizens that is rivalled by only a few industries.

    In summary, space generates MONEY for the government. This and satellite technology for monitoring water supplies, ecosystem health and national disasters can be used to help people and countries in need. It address all the arguments around using money for better “things”. Rather, space is a lucrative investment. Were it not, no venture capitalist would go near it! There would be no UK Space Angels network supporting and encouraging startup companies in the UK and the UK would not have a comprehensive national space policy which aims to generate one of the larger space industries in the world by 2030.


  2. Very thorough argument on both sides, and I feel that each view has been fully explored.

    Though I would argue that the conclusion is a little rushed. The idea that space exploration should be subsidised in order to edify the the young minds of today’s generation seems slightly tenuous, surely money would be better spent in schools, if education is the only thing to be taken from space exploration?

    I feel that there are wider achievements to be taken from space exploration, which would ethically validate public investment. Do we not owe it to ourselves as a species to explore as much as possible, and to seek out the Unknown? Surely this is validation enough. I don’t think it needs to be draped behind the thin veil of educational benefit.


  3. In your post, you say “Satellites play a vital role in our everyday life and are the basis behind almost all communication and earth monitoring systems.” but isn’t this exactly the same cosmocentrism that pushed billions of wasted dollars into space research in the past? Surely without satellites we would have alternatives that made use of other emerging technologies. You haven’t really made the argument that these are exclusive to the space industry. The marvel of the information age, for example, the Internet, is mostly supported by large submarine cables spanning the ocean. There are other technologies being developed where this money could be better spent if improving ease of communication and information is in fact the goal here.


  4. It would have been helpful if you had described the ethical basis from which you worked and tried to justify your position on investment in the space industry from that.

    I found the first argument very number dense. While this shows that you have done your research, it did make for slightly fatiguing reading as one number just blends into the next.

    In my opinion, it seemed that the 2nd argument was better balanced and more compelling as a result.


  5. I think that the issue isn’t so much spending in the ‘space’ industry because as you say, we need things like satellites and climate change monitoring systems. But I think the problem is spending money on exploring space for no reason other than to find out what’s out there. This sounds like a good cause but I think that we should focus on problems we have on this planet first such as those mentioned in the first argument (poverty and climate change). Then we can look into exploration.


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