The huge expenditures and bureaucracy needed to organize successful space exploration led to the creation of national space agencies. The United States and the Soviet Union developed programs focused solely on the scientific and industrial requirement for these efforts.

On July 29 1958, President Eisenhower signed the National Aeronautics and Space Act of 1958 establishing the National Aeronautics and Space Administration (NASA). When it began operations on October 1 1958, NASA consisted mainly of the four laboratories and some 8,000 employees of the government's 46-year-old research agency for aeronautics, the National Advisory Committee for Aeronautics (NACA). While its predecessor, NACA, operated on a $5 million budget, NASA funding was rapidly accelerated to $5 billion per year, including huge sums for subcontractors from the private sector. The Apollo 11 moon landing, the high point of NASA's success, was estimated to have cost some $20-25 billion.

Making comparisons of U.S. and Soviet space spending, especially during the Khruschev years, is very difficult. However in 1989, then-Soviet Armed Services Chief of Staff General M. Moiseyev reported that the Soviet Union allocated 6.9 billion rubles (about $4 billion) to its space program that year3. Other Soviet officials estimated that their total manned space expenses totaled about that amount over the entire duration of the programs, with some lower unofficial estimates of about four and half billion rubles. In addition to the murkiness of the figures, such comparisons must also take into account the likely effect of Soviet propaganda, whose goal was to make the Soviet Union look strong and to confuse the Western analysis.

Inefficient organization also plagued the Soviet effort. The USSR had nothing like NASA (the Russian Aviation and Space Agency was created only in the 1990s). Too many political issues in science, imaginary values instead of real ones, and too many personal views handicapped Soviet progress. Every Soviet chief designer had to stand for his ownideas, looking for the patronage of a communist official.

The Soviets were also operating in the face of a largely impoverished population not enjoying the fruits of the expanding U.S. economy. Eventually the Soviets inefficient economy, organization, and lack of funds led them to lose their early advantage. The high economic cost of the space race, along with the extremely expensive arms race, eventualy deepened the economic crisis of the communist economic system and was one of the factors that lead to the collapse of the Soviet Union.