One of the little-noted facts of modern American politics is how much space, NASA and the military are not partisan political issues.
Shortly after he took office, President Joe Biden indicated that he would continue both Project Artemis, the program to send astronauts back to the moon and eventually Mars, and the Space Force, the new military branch charged with operating in space. Since President Donald Trump started both Artemis and the Space Force, Biden’s decision to retain them was met with surprise and delight by many.
However, President Biden differs from his predecessor and potential successor in one policy that could affect the commercial space sector adversely. Whereas Trump favors tax cuts, the better to stimulate economic growth and job creation, Biden supports a soak-the-rich policy that he claims will address the deficit and restore “fairness” to the tax code.
During the recent State of the Union Address, Biden proposed not only hiking the corporate tax rate but imposing what he called a “billionaire’s tax” of 25 percent. He claimed that such a tax would raise $500 billion over 10 years. The tax increases are part of Biden’s budget proposal and, according to an analysis by CNBC, will be used to lower the federal deficit, claims the White House, by about $3 trillion in total over the next decade.
The idea of a wealth tax as proposed by Biden is that the government would tax a proportion of unrealized capital gains enjoyed by the wealthy. If the targeted assets rise in value, the government would take 25 percent of that increase. The owner would not have to actually sell the assets for the tax to be levied.
The proposal would work at cross purposes against another Biden administration policy, encouraging the growth of the commercial space sector to further American space exploration goals. If Congress were to pass Biden’s tax increases, SpaceX, Blue Origin, and a host of other commercial space companies would not have as much money available to build rocket ships and lunar landers as they otherwise would.
NASA’s space effort, including maintaining the International Space Station, depends on the commercial space sector, run primarily by billionaires like Elon Musk and Jeff Bezos, to operate cost-effectively. Astronauts have been riding to and from the International Space Station for nearly four years on commercial spacecraft, thanks to the Commercial Crew program. The ISS has been resupplied with cargo on private rockets even longer than that.
The SpaceX Starship, currently being tested at the Star Base facility in south Texas, is crucial for landing the first astronauts on the moon for the first time since the voyage of Apollo 17 in December 1972. Blue Origin intends to land a cargo version of its Blue Moon lunar lander on the moon’s surface in as early as a year using its New Glenn rocket.
Smaller space launch companies such as Rocket Lab are joining the competition for customers keen to send payloads into space. The commercial space revolution has lowered the cost of launching people and cargo into low Earth orbit and beyond.
Nor can the Commercial Lunar Payload Services program be neglected. So far, two lunar landing attempts have been mounted. One, undertaken by Astrobotic, ended in failure. A second, launched by Intuitive Machines, was (mostly) a success. The Commercial Lunar Payload Services program is a crucial part of America’s return to the moon.
The Biden administration is faced with a choice. It can either institute draconian tax increases against the private sector and wealthy Americans or have a vigorous, well-funded space effort powered by commercial space companies. It cannot have both.
The clash between Biden tax proposals and the White House’s space ambitions sets up an important issue for the 2024 elections. The matter could not only be decided by the outcome of the presidential contest, a rematch between Biden and Donald Trump, but down-ballot congressional races as well.
Voters will face a stark choice. Either the United States, and by extension the world, will enjoy a future of limitless possibilities fueled by opening space to business, or it will forego that future out of the White House’s desire for “tax fairness” and social spending. Hopefully, the voters will choose wisely.
Mark R. Whittington, who writes frequently about space policy, has published a political study of space exploration entitled “Why is It So Hard to Go Back to the Moon?” as well as “The Moon, Mars and Beyond,” and, most recently, “Why is America Going Back to the Moon?” He blogs at Curmudgeons Corner.