NASA is creating financial incentives for private companies to market lunar resources. This could be a first step to developing lunar mining capabilities. The biggest benefit of the program, though, is precedent. It puts the U.S. government’s imprimatur on space commerce. Given the ambiguities in public international space law, this precedent has the potential to steer space policy and commerce in a pro-market direction.
This is a key paragraph in Alexander William Salter and David R. Henderson, “NASA is Paying for Moon Rocks. The Implications for Space Commerce are Huge,” AIER, September 16, 2020.
Read the whole thing. It’s short.
READER COMMENTS
Jairaj Devadiga
Sep 17 2020 at 6:07pm
I see two separate actions by the US government here. One is the legislation to protect the property rights of US based companies in space. This is a welcome move.
The second is NASA paying them for gathering rocks and soil, which they need not even bring back to Earth, and will serve no purpose at all. This is a waste of the taxpayer’s money, as far as I can see.
You write:
I am not an expert on American law, so I fail to see why NASA needs to spend all that money to make the law effective. Simply passing the law should be enough, right?
David Henderson
Sep 17 2020 at 6:50pm
You might be right.
There are various ways to get a precedent, though, and buying the rocks, especially at a low price, might be the lowest-cost way.
AMT
Sep 17 2020 at 8:34pm
I am willing to buy a moon rock for one million Venezualan Bolivars, but it has to be delivered to me.
I have to agree it’s a waste of money. Why would anyone care about some meaningless token “precedent?” The precedent of Native Americans actually living in North America for thousands of years didn’t matter too much to the Europeans claiming the land as their own…
BC
Sep 19 2020 at 8:02pm
There seems to be some confusion about how the moon rocks relate to property rights, including in my own mind, so let me list my own thoughts to test my own understanding.
1) Offering to pay private entities for moon rocks creates an incentive for private entities to travel to, and set up installations on, the moon. To settle the West, the US government offered property deeds to anyone that was willing to physically travel West and claim property. The US might not be able to offer deeds for property on the moon — it’s not US territory — so paying for moon rocks could serve a similar purpose. That’s why NASA isn’t even requiring that the rocks be delivered to Earth. The point is to get private entities to establish themselves on the moon. If this is the end, then NASA might want to establish additional requirements that, even if the moon rocks don’t need to be delivered to Earth, the private entities must provide some way of indentifying, marking, securing, etc. the moon rocks over which it claims ownership.
2) Although some people like to claim that property rights are created by government through laws, deeds, etc., the *primary* means of creating property rights are through exercise: when property owners occupy and make use of property. That’s why it’s important that private entities travel to and establish themselves on the moon. Once established, anyone challenging their property rights, say a foreign government, would have to forcibly evict them. That’s not easy to do and much harder than challenging property rights that merely exist on paper. Establishing a history, custom, and practice of private entities operating on the moon matters as much as, if not more than, merely establishing paper rights through legislation.
3) Encouraging private entities to travel to the moon also makes it more likely that other space endeavors also make use of private entities. Although governments *could* continue to pursue space travel through government-run missions, space travel involves very high fixed costs, costs that space-faring private entities would have already paid, including the cost of gaining experience, know-how, etc. Thus, an established ecosystem of space-faring private entities may lead most would-be space travelers, including governments, to conclude that contracting with existing private entities is cheaper, more efficient, easier, etc.
4) Offering to pay for moon rocks establishes a precedent that the person collecting the moon rocks owns them. NASA is recognizing that, to take ownership of the moon rocks, it needs to gain the original collectors’ consent.
I would say that (1)-(3) seem the most important: establishing a history, custom, and practice of private entities exercising property rights in space, i.e., establishing *common law* or *natural law* property rights. That seems especially important when no government has sovereignty over the moon. Without sovereignty, how could a government establish statutory law property rights?
Does all this describe what’s going on? It’s not about the moon rocks.
Warren Platts
Sep 20 2020 at 2:44pm
This is interesting. It is an old meme that even if there were fully formed ingots of pure gold laying around on the Moon, it wouldn’t be worth it to bring them back to Earth. But if you did have a bunch of London Good Delivery bars in your possession on the Moon, it shouldn’t be necessary to bring them back in order to sell them–I think.
One could simply set up a very secure gold vault on the Moon, and then “allocate” the gold bars to whoever buys them. When they in turn sell the gold to someone else, the bar is reallocated to the new person.
I don’t see why that couldn’t work, as that’s the way most gold bullion vaults on Planet Earth operate. People rarely take physical possession of gold bars worth millions.
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