Nasa Crowds Out Private Efforts
There are real potential markets and economic justifications for going to the moon; it just depends on who is actually going. From my studies over the past 6-7 years of the engineering and business side of space development, I believe that private ventures are fully capable of profitably developing space even without government help. The potential markets are there, and while financing is tough, it is not impossible. I've posted online some of my thoughts about low-cost private space development as the Prometheus Downport Project.
I am worried that a government funded return to the moon might end up quashing several current startups who have been working on private returns to the moon, including Transorbital , LunaCorp, and others. However, there may be at least one big benefit to this plan. At least by getting NASA focused on the Moon and Mars, it will allow private enterprise a better chance at expanding into Low-Earth Orbit without the fear of NASA interference or competition.