While the world’s focus, understandably, is on the amazing technologies being demonstrated by SpaceX and Blue Origin, it is their financial and strategic plans that may matter most.

Unlike NASA or anyone else in the space industry, SpaceX and Blue Origin have plans to pay for their goals in space. The idea of major space projects paying for themselves, unfortunately, is just as unprecedented as the companies’ technologies.

The new technologies are certainly impressive — and necessary to achieve the financial goals.

On Dec. 21, 2015, SpaceX did what most had considered impractical, if not impossible: the first stage of an orbital launch vehicle returned to its launch site and landed. This success followed a five year, mostly privately-funded “trial-and-error” development effort, featuring multiple spectacular failures. Less than four months later and after more crash landings, on April 8, 2016, they achieved an even greater improbability: successfully landing on a wave-tossed barge on the open ocean. Since then, they’ve executed more landings, and sustained one more failure.

As if successful landings were not enough, SpaceX also demonstrated another technology that had been believed impractical. Super-cooling liquid oxygen to slush at minus 207 degrees Celsius increases its density, allowing more to be loaded into the rocket’s tanks. That reduces the tank size and mass per unit oxidizer, meaning that more propulsive power can be carried in a given tank.

It also requires loading the tanks and launching fast before the oxidizer can warm and expand – both difficult issues the company struggled with on subsequent flights.

The tanks themselves are larger than those on the old Falcon, and the second stage engine has a larger bell, making it more efficient in vacuum. All the changes increase performance enough to return the first stage to the launch site while still orbiting a useful payload. Alternatively, if the first stage is expended, the new version of Falcon-9 can lift relatively heavy loads for a medium-sized rocket. Even before the Falcon Heavy flies, the company is pushing farther into the market for larger satellites, currently dominated by rockets like the Ariane 5 and Atlas 5.

Blue Origin achieved their own return and landing on Nov. 23, 2015, a month before SpaceX, with a single stage suborbital vehicle capable of carrying six passengers briefly into space. Video of the Blue Origin New Shepard suggests it employs a unique aerodynamic ring to achieve a safe separation of the passenger cabin, followed by a parachute landing.

The first stage then landed at the center of its launch pad, a precision that was later relaxed to allow for greater stability. On Jan. 22, 2016, Blue Origin repeated the feat with the same rocket, becoming the first company to use the same first stage twice. Proving that no fluke, they have since flown the same stage a total of four times.

SpaceX’s stage dwarfed Blue Origin’s suborbital vehicle, returned from a far greater down-range distance and velocity, and is of greater near-term moment for lowering the cost of space activities. It was also second. “Join the club,” tweeted the combative founder of Blue Origin, Jeff Bezos, to SpaceX’s Elon Musk.

The two companies’ goals are sharply different. SpaceX’s is the same as NASA’s – a human mission to Mars – though SpaceX’s ambition extends far beyond that, to, in Mr. Musk’s words, “a city on Mars.” Blue Origin talks about “millions of people living and working in space.”

The new technologies, however, share a common theme and purpose. Neither company’s goal is achievable without first lowering the cost of getting to orbit. That not only lowers the cost of getting to Mars or anywhere else, crucially, it attracts paying customers unrelated to Mars exploration.

Even before the upgrades, the lower-cost Falcon had brought almost half of the commercial launch industry back to the United States – an industry long thought lost to heavily subsidized overseas competitors. That creates highly paid jobs that are not solely dependent on taxpayer funding.

The market for launching communications satellites is not the Falcon’s only target. SpaceX’s rocket is named after the Millennium Falcon tramp freighter in the Star Wars films. Like its namesake, it is something of a ‘jack-of-all-launch-vehicle-trades’. It can be used with slight variations to orbit communications satellites, and military and civil applications spacecraft. It can deliver bulk cargo to the International Space Station and elsewhere on a Dragon freighter built by the company, and soon passengers in a capsule based on the Dragon. The company claims the Dragon’s reentry shields, based on materials used for automated planetary exploration, are capable of withstanding a high speed return from lunar orbit and beyond.

Flying all these payloads with one basic rocket design leads to more, and more frequent, launches. Combined with SpaceX’s increasing market share, that further reduces costs through economies of scale.

Notwithstanding the recent launch failure, Mr. Musk’s strategy also involves increasing the reliability of launch vehicles. The Falcon uses multiple small, relatively simple engines operating with high margins. The rocket can complete its mission even if one engine fails, and much of the rest of the vehicle is similarly redundant.

With income earned from the Falcon rocket, and with any help he can get from NASA, Mr. Musk hopes to raise enough

money to develop a new generation of much larger reusable rockets for Mars colonization. He is keeping SpaceX private so that he can plough all its income back into achieving the Mars goal. Blue Origin is more secretive and not as far along, but they appear to share the strategy of first reducing launch costs, then using the resulting income to pay for their larger plans.

Compare all this to the United States government’s plan.

At the behest of powerful senators desperate to keep NASA’s armies of engineers employed in their districts:

NASA is spending tens of billions of dollars developing a rocket called the Space Launch System that is far too large to have any practical use beyond Mars exploration and the odd science mission. That means the rocket cannot be amortized over multiple users — commercial or military — meaning taxpayers pay the entire cost solely for the pleasure of going to Mars. Having a small customer base means, even under optimistic scenarios, this rocket will only fly up to three times a year. Operating it will always be extraordinarily expensive — again, a cost borne solely by taxpayers. All this ignores the lost opportunity costs of spending a large percentage of NASA’s human spaceflight budget, for almost two decades, on a “new” rocket using ancient Space Shuttle technology. Instead, the space agency could have used existing or commercially financed rockets that do not need to be developed by NASA and have multiple markets. For the money spent developing a single-purpose and uneconomic rocket, orbital construction and refueling technologies could have been advanced. The Delta 4 Heavy could have spent the last decade launching actual human spacecraft and landers, assembled in orbit and sent to Earth’s moon. A larger market for the Delta would have reduced its costs for all users, through greater economies of scale.

NASA is spending a slightly smaller portion of is exploration budget on an Apollo-like capsule that is so expensive it is unlikely to be used for any purpose other than taxpayer funded cis-lunar and Mars missions. Short of a cost-no-object emergency, it will never support the Space Station, repair satellites, conduct microgravity science, fly tourists, or any of the other activities that might require people in orbit.

The large size of the Space Launch System encourages another set of choices that are detrimental to an expansionist future in space.

Launching big, self-contained spacecraft on a large rocket creates a high risk of losing the entire mission in a single launch failure. A relatively small problem can cause an unrecoverable situation, e.g., the near-loss of the entire Skylab space station in a Saturn 5 launch fairing incident.

In contrast, the International Space Station was launched in small pieces, and then assembled by space walking astronauts. We were lucky enough not to lose any space station assembly flights. If we had, building the station would have been delayed and cost more, but it probably would not have resulted in the total failure of the project.

By splitting the mission into multiple smaller components, launched on smaller rockets that already exist, missions can start sooner and the budget can be spent on developing and flying payloads rather than on rocket development. A large mission can be paid for incrementally, one useful sub-mission at a time, with shared costs. For example, a solar-electric tug developed to send cargo to Mars could also earn money maneuvering applications satellites to their final orbits — but only if it is small enough to be launched on rockets commercial satellite companies can afford.

Building big, without shared costs, means building expensive. Each component is a mission unto itself, subject to easy cancellation, e.g., the loss of the large Altair lunar lander when the Constellation project was partially abandoned. Once very large spacecraft are developed, flying them involves a great incremental expense, making additional flights easy to cancel, e.g., Apollos 18 through 20. Contrast this to the steady-as-she-goes Space Station, where each additional launch is a small part of the total budget. The space station appears to have solid political staying power in spite of its high operating costs and lack of an easily understood purpose.

Using smaller rockets forces engineers early on to practice assembly in space. More importantly, it forces them to think small, potentially keeping costs down and increasing the overall redundancy of the assembled vehicles. That sets humanity up for the kinds of operations needed to tackle the rest of the inner solar system.

In short, by insisting on Orion and the Space Launch System, the senators are demonstrating how not to get to Mars, and certainly not to stay.

The SpaceX plan also has its faults. All of the negatives of the Space Launch System, except possibly its old technology and high cost, also apply to the giant rockets Mr. Musk wants to develop. He would do better to spend his money on payloads, and launch them on the Falcon Heavy.

More importantly, Mars is the wrong destination. It is a risky, expensive, and long way from Earth. Mars is only a little more habitable than Earth’s moon, a far easier target that is more appropriate for a privately funded effort. Being close to potential markets in low and geosynchronous Earth orbits, lunar resources like water, oxygen, and metals and rare elements derived from ancient asteroid impacts, might ultimately be commercialized. That is something that would be much harder to do at Mars, located far from any near-term industries in space. The Martian surface has no known resources that are useful in space that cannot also be found closer to home and in more shallow gravity wells. Yet, Mr. Musk’s colonists somehow will need to earn a living.

An outpost on Earth’s moon will not be as easy as many think, but if the “already done” moon seems too easy for Mr. Musk, there are other destinations more realistic than the Martian surface. The Martian moons Phobos and Deimos would allow SpaceX to practice interplanetary flight without the enormous added risk and expense of landing. Mars is not an easy world to land on, and doing so should not be taken lightly. Such a “PhD” strategy would allow SpaceX to operate around and on asteroid-like bodies, which could ultimately lead to main belt mining operations, another potential long-term strategy to make money.

A PhD outpost would enable scientists to efficiently operate rovers on Mars without the time delay from communicating with Earth. This would provide reconnaissance useful for later scientific expeditions with geologists on the surface. Most importantly, lunar and PhD destinations do not require development of a new rocket. The Delta 4 Heavy, or if successful the Falcon Heavy, will do just fine.

Today is a time of relentless budget deficits, and Brexit is causing further financial and political turmoil. The United States and the Western world are engaged in expensive military campaigns against multiple ruthless and hard-to-find enemies with no end in sight. An aging population is increasingly in need of long-term care. This is not a time to propose expensive, decades-long adventures on Mars funded solely by taxpayers.

By sharing costs with commercial markets in space, and paying as they go, Messrs. Musk and Bezos might yet find a road to Mars and the inner Solar System that has a chance of success.

If you want to go to Mars, make going to Mars affordable. But more important, make going to Mars pay – early, often, and lucratively.

Donald F. Robertson is a freelance space industry journalist based in San Francisco. For further examples of his work, see visit his webpage. Follow him on Twitter @DonaldFR.