NASA Keeps Betting on Rocket Lab While the Industry Consolidates

We are repeating the Space Shuttle's structural mistake, except this time we're calling it entrepreneurship.

In 1972, NASA promised Congress that the Shuttle would make space routine and cheap. Regular orbits, predictable costs, no more need for expendable rockets. Congress believed it.

By 1986, the Shuttle was the only launch option for most government payloads, costs had tripled, the manifest was years behind. Challenger exploded because the Shuttle was doing jobs it was never designed for. The kill-chain was structural, not accidental. Consolidation toward one solution made sense until it didn't.

NASA's recent decision to award Rocket Lab three dedicated launches follows the same geometry. Rocket Lab is real, capable, and ambitious — but it is not profitable. Small-lift providers cannot yet sustain themselves on commercial revenue alone. They survive on government contracts.

We're building the same dependency we built in the 1970s, just with better PR.

Three dedicated launches from NASA to Rocket Lab sounds like smart diversification. It is, tactically. But it is also a subsidy for a company that cannot otherwise exist. The moment NASA becomes Rocket Lab's primary revenue source, NASA has a Shuttle problem again. You cannot cancel your vendor's contracts without breaking your own mission, you cannot demand accountability without risking its survival, and the vendor knows this.

Schumpeter saw this coming. The entrepreneur and the innovation bureaucrat cannot coexist in the same market for long. One consolidates toward monopoly. The other requires protection from the state. You get choice, briefly, then you get dependency wrapped in competition language.

The question is not whether Rocket Lab will succeed. The question is whether NASA will still have launch alternatives if it fails. History suggests the answer by then will be no.