Unfortunately, privatization is unlikely to succeed. Space is a failed marketplace because there are no identified businesses in space that return a sufficient ROI without significant resources added by government. R&D in a failed marketplace which is important to national interests has always been the province of government, and always will be. The "investments" made by NASA have been poorly thought out and even more poorly executed. That doesn't mean that we pull a China and burn all our ships and forbid exploration. You can see the results of that policy on their history and development.
The first trips of Columbus were economic failures with lives lost. The first North American colonies were economic failures for a long while (until they discovered that tobacco, a New World plant, was a good cash crop), and the early colonies had high loss of life. The early colonists paid the price, and their descendents reaped the rewards.
The Earth is too small a basket to put all our eggs into. We have limited resources, and finite living space. We also have occasional world-wide catastrophies that really mess things up. The long-term survival of the human race requires us to have access to space resources (energy, mineral, etc), and some money spent in that direction seems like a better investment than in propping up our failed public schools and social-welfare policies (which is where the Democrats would like to put the money)
The technological sophistication that the space programs sponsored in the 60's, led to the technological dominence of the US through the 70's and 80's (until Clinton and company started giving away the store in the 90's).
What we need is for private business to have incentives to create cheaper and safer avenues into space, and for the government to get the regulators (EEOC, OSHA, etc) and the trail lawyers off their backs
You can't do microgravity stuff on the moon. We need both space stations and Lunar stations.