Huh?
When NASA paid Boeing North American, and Douglas to build the Saturn V they weren’t obsolete. When they paid Rockwell International to build the space shuttle. When they paid SpaceX to launch a bunch of rockets to the Space Station they weren’t obsolete.
So what changed? NASA pays people to build rockets, same as always. Just because some billionaires are kicking in some of their own funds does not radically change things. The idea that rockets ‘before’ were all NASA and now SpaceX are ‘private’ is seriously misrepresenting things. That isn’t how funding works
You are right. I’m speaking from a position of ignorance. I’m basing my whole perspective on my personal belief (this part IS based on experience) that when the government gets involved in things like this they tend to significantly over complicate the whole process and end result.
Case in point is from a few decades ago, when the Isreali’s came up with a remote controlled aerial camera platform that was based, basically, on a remote controlled airplane. It was cheap and effective. The US Government decided to do the same thing. Their specs became a cash cow for the vendors that produced it. It was a flying wing that cost hundreds of thousands per copy and was unwieldy to operate.
Private enterprise, with the profit motive, is lean and mean.