Bill To Require Reusable Rockets Benefits SpaceX At Taxpayers’ Expense

Bill To Require Reusable Rockets Benefits SpaceX At Taxpayers’ Expense

New legislation will bias a military satellite program in favor of futuristic, unproven technology that could cost taxpayers billions.

Crony capitalism—a system where businesses thrive by winning favors from politicians and not by competing in the market—is a plague on this planet. If Congress has its way, that system may soon be making the jump from earth to space. New legislation will bias a military satellite program in favor of futuristic, unproven technology that could cost taxpayers billions.

The Department of Defense puts crucial military satellites into orbit using the Evolved Expendable Launch Vehicle (EELV) program. One of the main companies that has contracts with the EELV to provide the necessary launch vehicles is SpaceX, run by Elon Musk.

Over the last five years, SpaceX has spent more than $8 million lobbying the federal government, and the company will be getting its money’s worth with the Defense Authorization Act recently passed by Congress. The Act changes the law so that when EELV solicits “a contract for space launch services for which the use of reusable launch vehicles is not eligible for the award of the contract,” the Department of Defense must “notify in writing the appropriate congressional committees of such proposed solicitation, including justifications for such ineligibility, by not later than 10 days after issuing such solicitation.”  While this does not force EELV to purchase reusable rockets, the message is clear: Employ reusable launch vehicles or face increased interference from Congress.

Not surprisingly, SpaceX is investing heavily in reusable launch technology. SpaceX has already had some success with reusable rockets, the most recent occurring on Sept. 10 when the first stage rocket of one of its Falcon 9s successfully landed on a ship at sea after launching a satellite into orbit. SpaceX is well poised to take advantage of the proposed change to EELV.

But would the change benefit taxpayers? Definitely not in the near-term. Estimates vary, but most analyses suggest that a rocket must be reused at least five to ten times before it covers the cost of development. Internal studies by another space company, United Launch Alliance, have found that a rocket must be recovered and reused 15 times before it is more cost-effective than disposable rockets.

Thus far, the record for reuse is held by space company Blue Origin, which has managed to use one of its New Shepard launch systems four times. However, that system has only gone sub-orbital—that is, it has not yet completed a full orbit of the earth. None of SpaceX’s rockets have been reused more than twice. The company’s new Block 5 booster rockets are supposed to be reusable up to ten times, but as we have seen in recent years Elon Musk has a habit of overpromising while under-delivering.

Unfortunately, the damage would probably not be limited to the EELV, as bad ideas from Congress usually metastasize. Congress would next pressure NASA to employ reusables. After years of failures and setbacks, NASA began contracting out its missions to private companies in 2006. A recent study found that this change has reduced the cost to taxpayers by almost 40 percent. Compelling NASA to use more costly reusable rockets would hinder the recent progress the space agency has made.

Additionally, NASA may soon have to resume ferrying U.S. astronauts to and from the International Space Station. Its contract with Russia to supply that service ends in April, and as of yet there is no indication that it will be renewed. NASA has entered into a $6.8 billion contract with SpaceX and Boeing to build new vehicles to transport astronauts. For taxpayers to get the most value for the dollar, SpaceX and Boeing will have to use the most cost-effective technologies available, and right now those do not include reusable rockets.

The private sector for space flight in the U.S. is increasingly vibrant and may someday make reusable technology feasible. Until then, though, Congress should not put its thumb on the scale to benefit politically connected companies.

It is odd, if not hypocritical, that this sort of cronyism is happening under a Congress controlled by Republicans—the party that is supposed to prioritize free markets and limited government—and while the current occupant of the Oval Office has promised to “drain the swamp.”  They would do well to scrap this idea before it gets off the launch pad.

David Hogberg is a senior fellow at the National Center for Public Policy Research. He is author of Medicare’s Victims: How the U.S. Government’s Largest Health Care Programs Harms Patients and Impairs Physicians.
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