Gigadollar-scale space projects seem like a particularly poor fit for the private industry model, though. Conventionally the idea of free-market competition is that companies stand to gain if they succeed but have to eat the losses if they fail, and so competition eventually selects the best. But we're not talking about making widgets or sandwiches or launch vehicles. Things like the ISS, JWST, etc are all one-off projects, and they cannot be allowed to fail, so competition doesn't really help and the public is left holding the bag, just like we see in the endless cost overruns of politically unkillable DoD contracts.

"Public bad private good" isn't a coherent strategy. If NASA isn't good enough then the preference should be to improve NASA rather than to insert an unnecessary layer of profit-taking for SpaceX or Boeing to do the same thing anyway.