Following the hubbub over the sale of some firms relevant to the Canadarm construction, I figured I'd chip in on something that's torn me for some time.
I think space exploration is important. In the very very very long run, it is crucial. I don't know if governments should be spending money on it. The private sector has by now clearly demonstrated the capability to move forward in this area, and has provided at least anecdotal evidence that a market might exist.
The basic reason why governments shouldn't spend on space is that the vast majority of their citizenry will never get a thing out of it, especially in Canada, where we could free-ride on the USA in large part, I would suspect. Certainly, researchers and engineers could keep pushing the boundaries of knowledge, but lots of disciplines do that without the need to send hugely expensive rockets into space. I'm sure there are lots of scientists who could point out many good reasons for actually building their projects, but economics is, after all, about the allocation of scarce resources.
Conversely, space exploration generates tons of positive externalities. There are a lot of technologies out there that were subsidized, or owe something to, NASA et al. Particularly NASA, I would suspect. (Though the military as well, among many other things.) And we all know the classical results about technology and the very long run - it's the only thing that matters.
Obviously, I have no idea whether the costs outweight the benefits: do we count nebulously-defined things like national pride? Either way, I find myself unable to take a strong position.