Russian Space Agency Misused $1.8 Billion, May Be Replaced

An anonymous reader writes: After a pair of high profile launch failures in the past few months, Russian space agency Roscosmos is making headlines again: this time for corruption. A public spending watchdog reported that the organization had misused 92 billion rubles ($1.8 billion) in 2014 alone. Deputy Prime Minister Dmitry Rogozin said their space efforts have been undermined by rampant corruption. "We have uncovered acts of fraud, abuse of authority (and) document forgery. With such a level of moral decay, one should not be surprised at the high accident rate." He also said Roscosmos is to be "abolished," and replaced by a state corporation of the same name by the end of the year. "In its new, corporate identity, Roscosmos will be responsible not only for setting mission goals but managing wages for space industry workers and modernizing production facilities."

Comments

Corruption? In Russia?

[Stormwatch]

I am shocked and appalled.

Re:Corruption? In Russia?

[countSudoku()]

"At least, the Russian government is doing something about it."

No, no they're not. It's just being swept underneath a bigger rug. A rug also filled with many vermin who will enact the same corruption as before, but hide it more betterly. At least in the US our media outlets get to cover this kind of thing to keep them honest and transparent. In Russia, the media is in on the caper. 100% true facts, kid. Get a clue next time you chime into a topic. I'll bet on NASA over the Kosmonuts on EVERY occasion. BOOM!!1! That JUST HAPPENED! (only a simulation, had another Russian Space Junk Probe blown up we'd have funny pix on Instagrab already, dingus.)

Re:Corruption? In Russia?

[dunkindave]

Seriously though: whether in Russia or in the USA, such an important agency, in charge of a large budget, is bound to generate fraud and shady dealings.

Sadly, the rule of thumb in the US government is they assume about 5-10% of a project's budget is lost to corruption/abuse/theft/fraud/etc., with it averaging about 7%. When you think about that the total US government annual budget is almost $4 trillion, that means they are estimated to loose around $300 billion each year (it was estimated to be $261 billion in 2012).

Re:Corruption? In Russia?

[khallow]

The media in the USA is the most dishonest I've seen.

Then you haven't seen many medias. I'll just note that there was a very relevant society who once named their chief propaganda outlet, "Truth" which just happens to be "Pravda" in anglicized Russian.

Re:Corruption? In Russia?

[rtb61]

Here is how it works. What Germany was versus what Germany is now. What Japan was versus what Japan is now. What Russia was versus what Russia is now. I don't need to tell you what the 'was' was or the self evident reality of what the 'is now' is. Unfortunately what the USA was versus what the USA is now, tells the opposite story of how things can sour and go bad.

Government private partnerships are more often about blatant corruption than anything to do with serving the public PS that Roscosmos partnership was crafted by Western Financiers in association with corrupt Russians. I think there is going to be a cleaning out of Russian oligarchs, something that puts real fear in all the other oligarchs around the world, that visible demonstration of how exposed and vulnerable they are in reality.

Re:Corruption? In Russia?

[khallow]

So just how badly are you trying to lose this argument?

Re:Corruption? In Russia?

[hawkfish]

You don't like the numbers that have been published but have no facts to support what you would rather believe so you attack the reputation of the source of the numbers as your fallback. Have you considered pursuing a career as a lawyer or politician? You would fit right in.

My point is that you have no facts either, just the rantings of one of the most corrupt politicians in the House (which is ironic, given that we are talking about corruption...) You did not provide any sources for Mr. Issa's claim - and neither did the Post article you cited. In fact, the same article provided another (unsourced) number that was less than half what Mr. Issa claims.

Moreover, the article you linked was not written by the Post itself, but by some "senior principal analyst" at a company that specialises in government contracting! Do you think that maybe claiming that their competitors are missing billions of dollars in "waste, fraud and abuse" might just be a marketing ploy?

The problem

[CanadianMacFan]

Was probably that they were bribing the wrong people, not the corruption itself.

This seems foolproof!

[fuzzyfuzzyfungus]

So, let me get this straight: your public-sector space program is a fucked-up labyrinth of corruption, fraud, and mismanagement.

You propose to replace it with a sole-source, crony capitalist, 'state corporation', to take advantage of the important synergies between the public sector's capabilities in corruption and mediocrity and the private sector's sophistication in financial and organizational malfeasance?

Christ, guys, if you keep this up I'll start feeling good about US mil/aero procurement practices by comparison...

You can argue about the relative virtues of public sector and private sector agents for various purposes; but there is no lower form of life than the crony capitalist entity when it comes to corruption.

Re:This seems foolproof!

[msauve]

The Russian government has more efficient and cost effective methods of corruption.

Re:This seems foolproof!

[aaron4801]

And where will all the employees for this "new" corporation come from? Perhaps Russia has a bigger space exploration industry than I'm giving it credit for, but my guess is Roscosmos.
So to sum up, this reorganization will keep the same name, operate out of the same facilities, and (likely) keep a substantial amount of the same employees. The only difference(?) is that instead of a state-run agency, it will be a state-run corporation. Oh and magically all the corruption will stop.

Re:This seems foolproof!

[Rei]

This is, after all, the same country whose 28 mile road to the Olympics cost more than if they'd covered the whole road with gold medals two layers thick. ;)

Concerning this privatization, the only question that remains is, which friend of Putin is going to get to "buy" the space agency at a " fair market value" ;)

Re:This seems foolproof!

[Monty845]

What is really going on is that there were two high profile rocket explosions. As long as the rocket launches were going fine, no one cared about the corruption. Now so "something" needs to be done, so they will take this action against corruption to fix the problem.

Re:This seems foolproof!

[whathappenedtomonday]

While you are right, what puzzles me here is that they name corruption as the cause of problems. Usually, even if you identify corruption as a problem, you do not call it corruption, nowhere and never (and it's not as if Russia is the only country where corruption is rampant). While I wonder what exactly hides behind this news tidbit -- and we all know that the message itself is likely very far from communicating what is actually happening or intended -- I assume that even bringing up corruption in this context might be a message in itself. Then again, what do I know ... someone enlighten us (Edja Snegskowsky, help us out!).

Re:This seems foolproof!

[Dr.Dubious DDQ]

"You propose to replace it with a sole-source, crony capitalist, 'state corporation', to take advantage of the important synergies between the public sector's capabilities in corruption and mediocrity and the private sector's sophistication in financial and organizational malfeasance?"

(No, I'm not going to write it! NO! I said! My will is strong! I cannot...)

In Soviet Russia, State corrupts Corporations!

(Dagnabbit...)

Re: This seems foolproof!

[Rei]

That's true - olympic medals are only required to contain a minimum of 6 grams of gold, and at least 92% silver. Even still, it's a an incredible price

$9.4 billion for a 28 mile road. And we're not talking through an urban area, just simple new constuction. 4 lines. 28 miles. 45000 meters long with an actual driving width of... oh, let's say 3,5 meters per lane? Not sure what's typical. So about 157500 square meters. $60k per square meter. I mean, seriously, just think about that. You could stack $1000 Louie Vitton handbags 5 layers deep across the whole road for that money. $9.4 billion for 28 miles? You could pay Russians $3 an hour to carry passengers on their shoulder at 3 miles per hour and carry 50 thousand passengers per day every day and it wouldn't cost as much as the road for nearly 20 years.

Re: This seems foolproof!

[Anonymous Coward]

Bollocks
The road includes a railway line (strange that wasn't mentioned) and a shit load of bridges

The original source is a political attack video so anything like Louie Vitton handbags is just shit
Fuck, they are making John Pilger look unbiased!
(John Pilger is Micheal Moore on steroids)

The total lack of information on the railway and the terrain means any information on the price must also be suspect (in other words - Total Bullshit)

Meta-corruption?

[Anonymous Coward]

Knowing what things look like in Russia, one has to wonder whether this is has some elements of politics as well - is one of the Russian oligarchs trying to take control of the space industry and get more money into their pockets by replacing the existing organization with one tied to themselves? Knowing how rampant corruption runs in Russia, announcing it so dramatically at this point in time might have ulterior motives...

Putin would like to get his hands on that money

[stonedown]

When Putin charges someone with corruption, it's usually because they control government expenditures and are unwilling to give him his usual kickback. So, it looks like he's going to create a new space agency and install an ally to take advantage of the inherent business opportunities provided by access to a budget of over $5 billion.

Read more about Putin's kleptocracy here:

http://www.reuters.com/investi...

Re:Misplaced?

[dunkelfalke]

I don't think so.
Embezzlement is rampant in Russia. The money is probably sunk in the management houses - for some reason they are crazy about bling-bling in the 18th century nobility style.