[avmich]

Yes, I think we talk about different things. Main focus of criticism of alt-space, a.k.a new private space community is cost-plus schemas of payments, which encourage increases in costs. The big difference of SpaceX was offering a "function" for sale - there is a launch capability, which has price N dollars per launch or M dollars per kilogram on LEO, and NASA can take it or not.

This way the idea that all or many congressional districts should participate in NASA contracts - because then those congressmen support increasing NASA's budgets - goes out the window. Now congressmen - and congresswomen, of course - can judge NASA in terms of space progress vs. money spent, not in terms of distribution of money to jobs in their districts. From this point of view, your question is irrelevant - no, it wouldn't, as after forth launch Falcon-1 SpaceX didn't have funds to continue, and NASA helped, but that doesn't mean NASA doesn't have an ineffective policy.