Space
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Space, the final frontier. The day that astronauts clad in blue-and-white space suits are launched beyond planet Earth to conduct research will be an occasion of great national pride. Make no mistake: The dream may be a distant one, but it is on the agenda.

Israel's space program isn't in orbit just yet. It's sitting on the desk of Finance Minister Yuval Steinitz. Treasury officials are studying its targets and suggestions for achieving them.

The main thrust of the program is to encourage corporate Israel to join the space race before it's too late to jump onto the orbiting bandwagon, and to do so in an organized fashion. The bottom line is that the treasury is mulling a proposal to invest NIS 300 million a year in the Israeli aerospace industry. The National Economic Council's two cents on the matter is that the sum is insufficient, but more on that later.

Not a week goes by that Cabinet Secretary Zvi Hauser doesn't call the treasury chieftains to inquire about their progress. It's not a private obsession of Hauser's. The program, catalyzed by President Shimon Peres, also sparked the imagination of Prime Minister Benjamin Netanyahu and both men would like to post some progress toward outer space in 2011.

Israelis involved in space warn, however, that the program is doomed to failure without the involvement of the corporate sector. Crumbs from the defense industry won't send rockets into space or satellite parts to customers.

However it's achieved, the space program will cost taxpayers hundreds of millions of shekels a year, but the Finance Ministry expects to gain more than just national pride from the investment. If the areas of the local aerospace industry that show potential are developed the economic rewards could be huge, and along the way Israeli education, technology and society in general could receive a tremendous boost.

Israel won't be drifting in space alone. In the next decade, thousands of companies around the globe will be vying for a slice of the growing outer-space economic market. To name just one example, robots will one day receive marching orders for their routine, Earth-based task via satellite. Satellites, meanwhile, are already being used to provide early warning of natural disasters from storms to locust swarms, as well as being employed for communications, defense and a host of other purposes.

Terrestrial war will be augmented by war in space. Countries will seek to blind each others' military and civilian satellites, or to intercept and destroy them. In parallel, they will need to protect their own satellites from enemy intervention.

All these activities, from scanning the surface for trouble to neutralizing an enemy's spy satellite to safeguarding one's own, have strategic, social and economic implications. The upshot is that in the next 50 years outer space is expected to come closer than ever to all of our lives. Visionaries anticipate the discovery of new metals that will revolutionize industry and look forward to the day when a plane can fly from Tel Aviv to Los Angeles in three hours by leaving behind the Earth's atmosphere, lessening friction and the pull of gravity. (A direct flight on that route today takes around 16 hours. )

Israelis are already experts on satellite technology, products for satellites and ground stations, all red-hot areas that are expected to stay that way in the years to come.

U.S. President Barack Obama demonstrated his commitment to the American space program by allocating $6 billion more for NASA over the next five years. The money is supposed to be used, in part, to outsource to the private sector work that the National Aeronautics and Space Administration had customarily done in-house in order to free the agency's resources for more additional scientific research and experimentation. One option is for the near-earth region to pass from the space agency's fief to that of private business concerns.

We're No. 8

Back in our neck of the woods, Israel is considered the eighth biggest source of space-related sales, according to Futron, a research company, in a survey of the competitiveness of space companies around the world.

Israel's goal is humble enough, ostensibly - it's to propel itself into fifth place by honing its competitive edge. That's the vision of Israel Space Agency Chairman Prof. Isaac Ben-Israel and Science and Technology Ministry Director General Menachem Greenblum.

The ISA isn't exactly NASA. It's been around for decades, is located at Tel Aviv University and is thinly staffed. Its main job is to advise the government on space-related issues.

It is, however, an office of experts, and it recently issued a report that concluded that Israel is gradually losing its competitive edge because investment is insufficient.

Spending on the Israeli space program is a function of Israel's defense priorities, and is also fed by the defense budget. But the defense budget alone can't support an advanced space program staffed by skilled, creative people, warns the agency.

"The way to save the Israeli space industry from its crisis is to develop a civilian space program," the agency said in its report, "whose purpose would be to develop national infrastructures, with an emphasis on economic leverage. Without a strong civilian space program, soon enough there will be no military space program either." Certainly in the United States, private enterprise is gaining a foothold in space-related endeavors, thanks to NASA's outsourcing. Shimon Peres' people, pushing the space agenda in government corridors, say that if Israel comes late to the table it will get only crumbs.

The upshot of the ambition to realize Israel's potential is the national space program sitting on Steinitz's desk. It sets goals and discusses government funding to achieve them. Appended to the report is a paper on the topic by the National Economic Council in the Prime Minister's Office.

One might wonder why the government has any interest in boosting a civilian space industry. The report's authors address that question: There are fundamental areas of research in which the government should intervene. Sometimes governments need to support applied research to enable it to achieve critical momentum. The financial risks inherent in aerospace endeavors are tremendous, while the private sector cannot grasp their "positive or external ramifications." Government subsidy is crucial, they conclude.

Over the years Israeli companies engaged in space, in whatever capacity, have received about $2.5 billion in funding, estimate industry sources. (These companies are the likes of Rafael Advanced Defense Systems, Elbit Systems and Israel Aerospace Industries ). About a fifth of that amount derived from the Israeli government and the rest from foreign sources, notably governments that sought to collaborate with Israel. The report advises that Israel forge collaborations in space with Russia, India, Singapore, the European Union and Brazil. Some on this list have expressed interest in the past.

Google Israel in space?

But for anything to happen, the report emphasizes, Israeli investment must ramp up. The developed nations invest between 0.05% to 0.1% of their GDP in space-related ventures. If Israel's GDP is about $200 billion, then an investment of 0.1% would translate into $200 million. Yet all the report's authors are asking for, at this stage, is NIS 300 million a year for five years, aside from any defense-related investments in the field. They project that sales of civilian space-related products could reach $5 billion to $10 billion a year.

The program lays out priorities for the money: 70% would be earmarked for the establishment and development of made-in-Israel space endeavors, and for the establishment of international collaborations. Ten percent would be earmarked for basic research, for instance developing new materials and technologies, and 20% would be reserved for applied research - again, in materials, technologies and methodologies.

The National Economic Council has rather different figures.

In its paper appended to the National Space Program sitting on Steinitz's desk, the council estimates that initial investment to jumpstart an Israeli space industry would cost $500 million a year for seven years. It says the government should contribute one tenth ($50 million a year ), while the rest should come from the private sector.

Sales to commercial entities, not including the Amos satellite project, are estimated at $550 million over five years. Part of the funding for space endeavors would derive from dividends paid to the government by Rafael and IAI, suggests the council. It also proposes that $50 million over a period of seven years- half from the state and half from donations - be earmarked for academic space-related research.

The council also proposes the establishment of what boils down to a venture capital fund that would invest in space-related startups. It would be a joint venture between government and the business sector. It's early days but feelers, have been sent out to the likes of Google, Siemens and Cisco Systems. It would be modest enough: The council suggests pledges of $75 million over seven years, of which the government would pony up $50 million.

What would Israel get out of all this? Proponents say it could jumpstart civilian industry and the country's educational system and even lead to social change. Sound farfetched? Maybe the view from space will make it look less so.