Signals from SpaceShipOne

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On Oct. 4, 2004, the 47th anniversary of the launch of Sputnik, humanity again made spaceflight history.

SpaceShipOne, designed by Burt Rutan and his company, Scaled Composites, and built with money from Microsoft cofounder Paul Allen, won the privately funded $10 million Ansari X Prize by becoming the first three-passenger private vehicle to fly into space twice in a two-week period.

SpaceShipOne's triumph teaches us four lessons:

(1) It reminds us of the power of competition. Entrepreneurs who compete with one another generate the dynamism of free enterprise. They cannot simply offer adequate goods and services when competitors might offer the excellent. Competition pushes entrepreneurs to strive to satisfy and thus keep their customers. Whether it's automobiles, personal computers, the Internet, consumer electronics or airline flights, only entrepreneurs can commercialize goods and services, making them available to all. The X Prize stimulated competition in spaceflight, which has for too long been dominated by government. The result is SpaceShipOne's triumph.

(2) It shows us the power of pride. Mr. Rutan's team, as well as the other two dozen competitors for the X Prize, struggled with limited resources to develop new, innovative and ingenious ways to travel 100 kilometers above the Earth, into space. They called upon the best within themselves and gave themselves what no one else could: the knowledge of a job superlatively done despite great challenges, and the manifestation of their creativity and rationality that made the achievement possible.

(3) It demonstrates the motivational power of profit. Private cash prizes were heavily used in developing civil aviation; Charles Lindbergh won the $25,000 Orteig prize in 1927 when be became the first individual to fly nonstop across the Atlantic. In the wake of the X Prize success, Robert Bigelow, founder of Bigelow Aerospace, which plans to place a private station in space, has offered a $50 million prize for development of a vehicle capable of carrying as many as seven people to an orbital outpost -- hopefully, one of Mr. Bigelow's.

Mr. Rutan used some $20 million invested by Mr. Allen to win $10 million. That doesn't sound very profitable, but Mr. Rutan's efforts aim at long-term profit -- he plans a business carrying passengers on suborbital trips and eventually orbital flights into space. In fact, billionaire Richard Branson, founder of Virgin Atlantic airline, is partnering with Mr. Rutan and Mr. Allen in hopes of carrying 3,000 private astronauts into space in the next five years.

Prosperity is a good thing, and, in the process of pursuing their own economic and spiritual well-being, these space entrepreneurs will create a commercial revolution as Mr. Allen did with Microsoft and Mr. Branson did with Virgin Atlantic.

(4) SpaceShipOne marks a paradigm shift. For nearly five decades, most people thought of space as a government program and believed travel beyond the atmosphere simply too costly for the private sector. Of course, it was the government providing the service that kept the cost high, and government regulations helped discourage private entrepreneurs from trying to create their own space businesses.

But Peter Diamandis, president of the X Prize Foundation, sought to create a revolution not only by sparking entrepreneurial competition but by changing how people think about space: It can be a free-market frontier, where private firms take you to private facilities for your private edification.

Mr. Rutan designed the Voyager, the first plane to fly around the world without stopping or refueling. That craft now hangs in the Smithsonian Air and Space Museum in Washington, along with Lindbergh's Spirit of St. Louis, the Wright Brothers' 1903 flyer, Chuck Yeager's X-1 and the Apollo 11 craft that carried the first men to the moon.

SpaceShipOne should one day hang beside those pioneering craft, in tribute to the private entrepreneurs who opened space to all mankind.

Edward Hudgins is editor of the Cato Institute book, "Space: The Free-Market Frontier," and Washington director of the Objectivist Center.