NASA and privatization

My current opinion is that NASA should be slowly transformed into a regulatory agency as the space industry emerges. 

I have this opinion for several reasons.

1. NASA is extremely expensive. The tax dollars that are currently used for NASA might be better used for infrastructure improvements (highways, dams, etc.)
2. Businesses have flexible organizational structures, the ability to attract talented scientists, and external funding (stocks and bonds). These factors allow businesses to innovate at a much faster rate than government agencies.
3. NASA is using outdated technology for many of its larger projects. This is due to its dependence on bureaucracy and tax dollars. The Space Transportation System (which ends this year) received presidential approval in 1969 and was designed in the 1970s. The launch of the Hubble Space Telescope was originally planned for 1983, but was delayed until 1990. A design flaw prevented the Hubble Space Telescope from achieving its full potential until 1994.
4. Manned spaceflights haven't moved beyond low Earth orbit since 1972 (Apollo 17). This fact is particularly important because a new lunar spaceflight would allow the placement of a lunar observatory.

Placing an optical or radio observatory on the lunar surface should be NASA’s primary objective. The scientific advances allowed by a lunar observatory are too important to ignore.

NASA does not appear capable of achieving new milestones such as a lunar observatory. Full or partial privatization might allow new achievements in manned exploration and deep space astronomy.

I've included links to 2 articles on this subject.

The Viability of a Lunar Observatory 
A Concept for a Simple Radio Observatory at the South Lunar Pole