By the time Shuttle development began, it was clear that the original vision of a Shuttle as part of a larger space transportation system was far too costly and ambitious to receive Congressional support. So NASA concentrated on building only the first component of its vision, a reusable manned spacecraft that could reach low earth orbit. Since NASA assumed it would be able to fly Shuttle missions with a turnaround time as low as two weeks, this left the vexing question of what to do with all that spare launch capacity. The tiny commercial launch market was in no shape to supply such a wealth of satellites, so NASA turned to the one agency that had an abundance of things requiring shooting into space - the Air Force - and asked it to abandon its unmanned rocket programs, instead committing all future satellite launches to the Shuttle.

The Air Force was only too happy to agree, but at a crippling price. What the Air Force wanted to launch was spy satellites - lots of them, bulky telescopes with heavy mirrors, the bigger the better - and it wanted to launch them in an orbit over the Earth's poles, so they could snoop over the maximum amount of Red territory. This meant NASA had to go back to the drawing board, since polar orbits would require a heavier orbiter than the Shuttle design had anticipated, which in turn meant using a bigger rocket at launch, and dissipating more heat during re-entry.

Moreover, there was no way to launch a polar mission safely from Kennedy Space Center — it would mean overflying either heavily populated areas in the Carolinas or risking capture of a fuel tank by the wily Cubans. So the Air Force also demanded, and got, billions in funding to build a new Shuttle launch facility at Vandenberg Air Force base in California. And because some of the Air Force's military missions involved capturing a Soviet satellite on the sly and landing after one orbit, the Air Force demanded that the Shuttle be capable of gliding over a thousand miles cross-range during re-entry, so that it could catch up with the rapidly eastbound Air Force base underneath it. This meant bigger wings, which in turn meant more weight, an even more powerful rocket, and again a more complicated heat shield.

Most of the really wrong design decisions in the Shuttle system — the side-mounted orbiter, solid rocket boosters, lack of air-breathing engines, no escape system, fragile heat protection — were the direct fallout of this design phase, when tight budgets and onerous Air Force requirements forced engineers to improvise solutions to problems that had as much to do to do with the mechanics of Congressional funding as the mechanics of flight. In a pattern that would recur repeatedly in the years to come, NASA managers decided that they were better off making spending cuts on initial design even if they resulted in much higher operating costs over the lifetime of the program.

To further cut costs, and keep the weight from growing prohibitive, the Shuttle became the first manned spacecraft to fly without any kind of crew escape system, relying on certain components (solid rockets, wing tiles, landing gear) to function with complete reliability. NASA also decided not to make the Shuttle capable of unmanned flight, so that the first test flight of the vehicle would have astronauts on board. This was a major departure for the traditionally conservative agency, which had relied on redundant systems wherever possible, and always tested unmanned prototypes of any new rocket. It showed how confident NASA had grown in its ability to correctly predict, simulate, and design for high reliability.

The final Shuttle design, incorporating all of the budgetary and Air Force design constraints, was impressive but not particularly useful. Very soon after the start of the program, it became clear that Shuttle launches would not be routine events, that it would cost a great deal of money to repair each orbiter after its trip to space, and that estimates of launch cost and frequency had been wildly optimistic. At the same time, the Air Force proved unable to get the Vandenberg base ready for use, negating much of the reason for the extensive Shuttle redesign. After the Challenger explosion, the Vandenberg base was quietly mothballed. Not once did the Shuttle fly a mission to polar orbit.