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How George W. Bush and NASA Saved SpaceX From Financial Ruin (blastingnews.com)
MarkWhittington quotes a report from Blasting News: Elon Musk and the people at SpaceX are rightly basking in the afterglow of finally landing the first stage of the Falcon 9 rocket on a drone barge in the Atlantic. The same flight delivered an expandable module built by Bigelow Aerospace to the International Space Station. But, as Ars Technica points out, the launch, landing, and arrival at the space station would not have taken place had it not been for the generosity of NASA. George W. Bush began the Commercial Orbital Transportation Services (COTS) program, which commercialized first cargo and then crew flights to and from the ISS. Four years later, SpaceX, having endured a number of launch failures of its small Falcon 1 rocket, was running out of cash. They were teetering on the brink of financial ruin as they were trying to develop a much larger and more complex Falcon 9 that would compete with more established launch vehicles such as the Atlas 5 and the Delta 4. Then NASA announced the initial contracts for COTS cargo flights. SpaceXâ(TM)s share was $1.6 billion. The NASA contract saved the company and allowed it to press on with building the Falcon 9 and the Dragon and then successfully compete for the Commercial Crew contracts.
In this case the right way to do it was to hire lobbyists so you can suck off of the government teat.
putting the 'B' in LGBTQ+
Big if there. In true libertarian fashion the company would have to have the numbers in a spread sheet, attract investors, get loans, float bonds or some combination thereof while saying, "hey are rockets explode but we'll be successful real soon now!"
But only the Gov't is willing and able to take a risk that big. So in this case government intrusion in the market place was the only option. The private sector cannot or will not take such huge risks.
putting the 'B' in LGBTQ+
In this case the right way to do it was to hire lobbyists so you can suck off of the government teat.
The companies that are really sucking at the government teat are Lockheed Martin and Boeing who collectively own ULA. They supply launches under "Cost Plus" contracts. Basically the government pays the cost, as decided by the company, plus a guaranteed cost margin. This causes incentives to inflate costs through hiring too many managers and by choosing expensive complicated designs. SpaceX saves the government money by doing launches under fixed price per service contracts. The government pays a fixed price for launches; this creates incentives for SpaceX to save money. SpaceX has become the world's most affordable launcher. They are already cheaper than the Chinese and Russians, even without reusing their rockets.
This and no other is the root from which a tyrant springs; when first he appears as a protector - Plato (423 to 327 BC)
I doubt it's that nefarious. Cost inflation happens in any large organization that isn't actively trying to prevent it. And they do have some incentive to keep costs under control - there's only so much money to go around, and projects that look to be more expensive than they're worth tend to get cancelled.
When it comes right down to it, wasn't NASA created to foster American companies and inspire the next generation of Scientists, Technologists, Engineers and Mathematicians?
Kudos to them believing in SpaceX and I hope that they continue to promote and support other up and coming companies.
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The problem is that government isn't a very tough negotiator. There's little incentive to do so when it's not your money.
Can't have parasites without food. And here. the government funding is the food source.