NASA could have done this long ago. And had test project that proved as much. Suborbital human flight is just not very interesting for anything other then tourism.
I agree privatization is a benefit - i believe that was my final statement in that they are complementary. I think that the bulk work is still done by public agencies, however the privatization part capitalizes from a revenue perspective on the work done by the public agencies.
It's not dissimilar to how most energy technology makes its way to the private companies. DOE research labs do most of the work with college collaboration and then it gets released through private equity into the public domain.
Privatization helps because NASA cannot afford failures today, but private companies can. And since space is a new and risky frontier, failures will happen. That's why I believe that privatization is a good thing overall