John Noonan commented that President Obama campaigned on a promise not to "militarize" space, but that was always a specious objective.
Space has been militarized almost from the moment man was able to place objects into space. Ballistic missiles traverse space on their way to their targets. Satellites fulfill a variety of critical military functions from space, including communications, surveillance, early warning, navigation and target acquisition. U.S. and Western military forces are totally reliant upon space-based systems and would be crippled if they were in any way disrupted or destroyed. The effect of losing communications satellites is obvious. Less obvious would be the impact of disrupting the Global Positioning System.
While our aircraft, ships and ground forces could probably revert to terrestrial modes of navigation, the loss of GPS would also disrupt our tactical communications, since both the new Joint Tactical Radio System (JTRS) and older SINCGARS radios rely on GPS for signal timing and synchronization. Loss of our surveillance satellites would blind our deployed forces and leave us vulnerable to surprise attack. Even the loss of our meteorological satellites would have serious consequences, not just for the military but for our society in general (compare hurricane death tolls before and after the advent of weather satellites).
Space represents high ground, and high ground has always had inherent military value. The army on the hill can see behind the lines of the enemy in the valley, observe its movements and direct fire against it. The enemy in the valley has only two options, if it wants to prevent that: take the hill, or bring enough fire down on it to make the enemy leave. The same phenomenon occurred when man took to the air. As early as the Civil War, tethered observation balloons were being used by both sides to observe enemy troop movements and map positions; and both sides quickly turned their artillery on the balloons in an attempt to prevent them from doing this. Balloons served a similar function in World War I, and quickly became prime targets in their own right.
The airplane was first used in war as an observation platform. Being self-propelled, they had more flexibility than balloons and could roam all over the battlefield. This prompted some of the first military pilots to take pistols and rifles up in their planes to shoot at the enemy's observation planes. Soon, observation planes on both sides were armed with machine guns for self defense, while specialized "pursuit" aircraft were developed with greater speed and maneuverability to intercept and shoot down observation planes -- which were soon escorted by pursuit planes for their own protection. Thus, warfare came to the skies through an inexorable yet logical cycle of development.
It is foolish to think that space would somehow be exempt from this same process, for space power is simply an extension of air power. In war, our adversaries, knowing our reliance upon space systems, would be foolish not to attempt, right at the beginning of a conflict, to destroy or neutralize our space systems. We, for our part, would be stupid to allow an adversary with military surveillance satellites to peer down at will upon our forces, or to take advantage of secure satellite communications, or to exploit precision satellite navigation systems. The spiral of offense and defense will exert itself, as they attempt to shoot down, blind or jam our satellites, and we attempt to do the same to theirs. Defensive countermeasures would be employed, first on an ad hoc, then on a more systematic basis.
As John Noonan notes, some of these might be passive defenses, such as dispersion of capabilities into "swarms" of low-cost micro-satellites, or maneuvering satellites to avoid interception or -- to make the enemy's task more difficult -- moving satellites into higher orbits.
But all of these options will be expensive and take time to deploy. Satellites in low earth orbit (LEO), such as our imaging surveillance satellites, are the most vulnerable, because they can be intercepted by something as simple as a ballistic missile lofting a keg of nails into its flight path. Maneuvering the satellite would make its orbit less predictable, but every maneuver burns up fuel that is needed to keep the satellite in orbit. Moving the satellites out to geosynchronous orbit (GEO) would offer a number of benefits in addition to enhancing survivability. Present satellites can only observe a given spot on the earth for a few minutes each day, while one in GEO can stare at a given spot 24/7 -- the kind of "persistent" surveillance that is so useful in low intensity warfare. But nothing is free: the resolution of the cameras on surveillance satellites is a factor of altitude and aperture size. Moving our surveillance satellites from LEO to GEO will require the development of very large mirrors which cannot fit inside the satellite (as is presently the case), but which must be unfolded like an umbrella once the satellite is on station. This represents a whole set of technical challenges that will take years to resolve (much of the research is being done under the aegis of NASA's next generation space telescope programs).
For this reason, it will be necessary for the U.S. to continue developing robust offensive space capabilities, such as ASAT interceptors; "fighter" satellites that could protect our vulnerable satellites from enemy ASATs; and ground-based anti-satellite lasers to blind enemy surveillance satellites. Again, this is going to take time and money, but not doing so is to cede the high ground to potential adversaries.
But, before any of this can happen, the U.S. has to get its military satellite programs under control. Practically every new satellite system is years behind schedule and billions over budget. Most of the blame can be ascribed to the loss of experienced space program management personnel who have retired and not been replaced, forcing the military to rely on space system contractors to serve as "lead systems integrators" -- the people who build the satellites are also the ones who manage the program on behalf of the government. The results should have been expected. The military compounded the problem by attempting to inject "competition" and "innovation" into its space programs during the last decade or so. Entrenched incumbents with many years of experience were displaced by newcomers who tended to over-promise on capabilities while low-balling costs. Since nobody remaining on the government side had the experience to provide a sanity check, the disconnect between what was promised and what could be delivered within the schedule and budget was discovered only after the fact, placing the military in the position of either backing off on requirements or pumping more money into the program in the hope that the contractor could fix the problem. But space is an unforgiving environment, in which one learns only by making costly mistakes. Hence, the U.S. will be saddled for years with aging and obsolescent space systems while its new programs play catch-up.