Lunar commerce: a question of semantics?
by Derek Webber
|What do we mean by “commercial development of the Moon?” If the customer is the government, and the provider of funds is the government, then maybe we would be wrong to call that lunar commerce.|
So, here is the lingering question that troubles me, and leads me to seek an answer. Are we fooling ourselves? Economic development of the solar system has long been one of the implied long-term purposes of the space program, and we have imagined that process starting soon with the imminent return to the Moon. But what if we are wrong? Maybe we shall not be ready for commercial development of the Moon for at least another several decades, or perhaps the problem we are facing is not one of timing, but instead a matter of definition, of semantics.
What do we mean by “commercial development of the Moon?” In a true commercial transaction, we need to be able to clearly identify and differentiate between the customer, the provider of product or services, and sometimes also a separate investor or provider of funds. If the customer is the government, and the provider of funds is the government, then maybe we would be wrong to call that lunar commerce. Also, if a product or service at the Moon is only possible because of a vast prior government investment into sunk costs, then here again it might be misleading to imply that such transactions represent lunar commerce, and thereby the beginning of the economic development of the solar system. Similarly, one person’s costs may be another person’s revenues. And so, we need to be very clear in our choice of language as we attempt to describe our governmental and commercial activities as we return to the Moon. It matters. Is the Moon going to continue to be a money sink, or will it become a source of wealth? There will always be “spinoff benefits,” of course, from such a complex endeavor as developing the Moon, but here I intend to lay them aside, and consider only the direct costs and revenues of lunar businesses and operations.
We might imagine a time—I am suggesting maybe 2060 onwards—when there will be a permanent human presence on the Moon that is totally sustained by the Moon’s resources and not dependent on a logistical supply chain of deliveries from the Earth. At such a time—let’s call it the “Late Phase”—there would be thriving lunar-centric businesses, with both commercial customers and providers on the Moon, possibly even using lunar currency. The Moon would then be providing a theater to try out a parallel with the early years of business on the Earth. It would become a new world able to generate wealth. But not yet. For a long time to come—let’s call it the “Early Phase” that I would suggest would last from 2020 through at least 2030—the government will be the customer for the vast majority of lunar business. There will, of course, be a gradual transition from the Early Phase to the Late Phase, during which transition time there will be a mix of government and true commercial customers. But let’s keep it simple for now and try to define what will be happening in each of the two main phases.
I think it would be helpful to try and scope out the kinds of “lunar commerce business” that we can expect, and to be realistic about timescales. What kinds of business can we expect in each of these two defining phases? In particular, we need to get a grasp on the Early Phase activities because of the need to budget, without entertaining any unrealistic expectations about possible revenue generation or taxation opportunities in this phase as a result of our lunar activities. In this Early Phase, it will be “we, the people” acting simultaneously as the customer and the funds provider, to the supplier of products and services. For the purposes of this paper, we shall ignore any activities predicated on possible subsequent exploration of Mars and elsewhere in the solar system, and the considerable employment-related benefits associated with any government-funded space program.
|I think it would be helpful to try and scope out the kinds of “lunar commerce business” that we can expect, and to be realistic about timescales.|
So, let’s make a start. I offer for consideration the following main activities that will be the business transactions during the Early Phase. Most of them will involve the government as the customer purchasing products, services, and supplies. Therefore, the funding for such activities would need to be included in successive NASA budget requests during the Early Phase period. I also identify a few truly commercial endeavors that may take place that will not require the government as customer, but I suspect that the revenues generated from this subset will not provide a significant contribution during the Early Phase. Let me know if I have missed anything that ought to be included.
That’s about it. Pretty basic. Now, let’s consider the much-expanded Late Phase. This would be very different and no longer totally dependent on government funding, although of course there would still need to be a continuing governmental presence in a support function and this would need the appropriate agency budget funding during the period. It is much more critical in this phase to be careful to avoid double counting, by being precise in our descriptive language.
I believe that this list captures the broad categories of transactions that we could expect to take place in the Late Phase of developing the Moon, from 2060 onwards. I would appreciate learning of any categories I may have missed, or where the descriptors permit double counting.
|Are we ever really going to have true commercial lunar developments, or will it continue with business as usual, as described here in the Early Phase characterization as forever being largely dependent on government funding?|
So, if we are agreed, we now have constructed a framework to take into account the whole range of activities, both governmental and commercial, whether in the near future or much later. At this stage, of course, we have very little idea about the quantities, both costs or revenues, that should be associated with each of the identified categories. But at least, by referring to this taxonomy, we should be able to avoid double-counting the money transfers. And we have a fairly comprehensive list of areas on which to focus as our planning progresses. And we can distinguish between governmental and commercial efforts.
The purpose of this discussion paper has been to encourage some thinking about what is meant by developing the Moon, the likely time phasing, and the sources of funds. It is intended to be a helpful way of identifying the various task areas, which will in turn lead to attempts to fill in the quantitative gaps by characterizing and planning for each of the work items, in part so that appropriate budgeting can take place. Are these categories a useful way to build a base for forecasting? And what about the semantics, and does it matter? Are we ever really going to have true commercial lunar developments, or will it continue with business as usual, as described here in the Early Phase characterization as forever being largely dependent on government funding? Or will there be a perhaps golden Later Phase, when we begin to make real money on the Moon, justifying all the sunk investment costs of the whole accumulated governmental space program, and if so, when do you think that will be? The taxpayers deserve to know the answer with as much transparency as we can provide.
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