The National Defense Authorization Act for 2020 has been a boon for the U.S. Department of Defense, the aerospace, IT hardware, telecom industries, and Wall Street. Morgan Stanley estimates that the global space industry and the increasingly codependent symbiotic relationship between private enterprises and the U.S. government could generate revenue of more than $1 trillion or more in 2040, a significant increase from $350 billion generated in 2020.
A low financial threshold of access to space is spurring technological innovation. The global space economy is set to benefit from ambitious government and private sector satellite launches, exploratory missions to nearby celestial bodies, asteroid mining and resource extraction, and prospective space tourism. Ample commercial opportunities, according to industry analysts, will significantly shift the investment landscape. It will permit much smaller entities and private start-ups to specialize in cutting-edge outer space research and development of data-intensive services via their satellite constellations.
Data, the global economy's new oil, already renders the once inscrutable frontiers of human knowledge far more transparent. Observational satellite and remote-sensing technologies are used to monitor illegal fishing patterns and greenhouse gas emissions in times of peace and troop movements in times of war. Its surveillance and predictive modeling capabilities can enhance agricultural yields and optimize global supply chains impacting shipping, port activity, and global trade.
The ebbs and flows of financial markets, too, are intimately tied to space. The European Union's 2016 MiFID II Delegated Directive and the U.S. Securities and Exchange Commission's FINRA Rule 4590 [amended in March 2023] set rules on the synchronization of business clocks, computer system clocks, and mechanical time-stamping devices to safeguard global financial instruments and funds. The order routing process for every global stock order or trade requires a precise timestamp governed since the 2000s by the now ubiquitous U.S. Global Positioning System (GPS). Each stock order is time-stamped when it is received on the trading floor and when it is completed. Stock exchanges around the world adopted GPS signal technology to accurately record financial transactions, which rely on a combination of space-based and terrestrial time sources to guard against any unexpected satellite coverage disruptions.
Time-stamping is vital to maintaining a vibrant global economy, regulatory compliance, and trading transparency. “Any firm trading in the United States and European Union must have reliable, synchronized time feeds to connect its trading applications and order management systems.” Achieving time accuracy and synchronization of global timekeeping systems and mitigating risk requires, in turn, an unprecedented reliance on a healthy satellite signals infrastructure.
The interplay between outer space and market forces has ushered in an era of catalytic innovation, opportunities for exponential financial growth, and the recognition of profound vulnerabilities such a relationship will inevitably carry. Fostering a resilient global economy will require maintaining a secure and robust space infrastructure and vice-versa. The decreasing financial barriers to space entry whilst paving the way to groundbreaking research and technological advancement will increasingly require regulatory oversight from an ever more sophisticated government sector. Pivotal industries in leading sectors of the economy are already undergoing structural transformations on a scale not seen since the Industrial Revolution, requiring — in tandem — a system-wide update in the form of structural changes to global governance mechanisms and its current institutional architecture.
To avoid decisional paralysis, fragmentation, or outright gridlock at the moment of complex transnational transformation in world politics and economy, private and public sector actors must find a way to coalesce around overlapping goals and norms, become adept at outlining forward-looking strategies that privilege and best advance human welfare over short-term commercial gains, resolve to peacefully manage interdependence and competition through a common set of policies and practices, balance risk, and substantively contribute to "norm entrepreneurship” through politically informed jurisprudence in international private and public law. It is in the U.S. and its allies’ national interest to re-establish their leadership in the global institutional landscape and harness the benefits of innovation whilst inclining its vast military prowess towards peace and cooperation.