The best way to make a profit as an aerospace company is to fail

It’s time for NASA to suit up.
It’s time for NASA to suit up.
Image: Reuters/Mike Blake
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Americans haven’t gone to outer space on American-made rockets for almost a decade—since July 8, 2011, to be precise.

NASA has paid up to $81.7 million per seat to get American astronauts into orbit onboard Russian Soyuz capsules. Meanwhile, China has moved ahead on its plans to dominate space and the vast resources beyond our atmosphere by 2049, which happens to be the 100th anniversary of the revolution that put China’s Communist Party in power. As international political analyst Namrata Goswami has pointed out, China has met every one of its space program’s target dates.

For years, the space military industrial complex, or SMIC—a hugely profitable handful of American defense companies including Lockheed Martin, Northrop Grumman, and Boeing, among other suppliers—has promoted and funded programs that have guaranteed Americans cannot get to space using American vehicles.

The SMIC is also making it nearly impossible for Americans to follow up on something they accomplished 50 years ago: Getting Americans to the moon, that centrally resource-rich frontier on which China threatens to outpace us in its claims.

Boeing, planes, space

In 2019, we saw two deadly Boeing 737 Max crashes take 346 lives.

Boeing has long been a central player in the space industry. Its Starliner space transportation capsule, designed to take humans to space, was launched Dec. 20, 2019, but it failed reach its destination of the International Space Station. Due to a software malfunction, the spacecraft had to make an emergency landing in White Sands, New Mexico, without delivering its cargo of Christmas presents to ISS astronauts. Software glitches were also reportedly behind the two tragic 737 Max crashes.

Three days later, the aircraft company announced it was firing its CEO Dennis Muilenburg.

But what does all this have to do with the US’s lag in the manned and womanned space race?

Quite a lot, it turns out, because not only is Boeing a big space player, it’s an integral part of the space military industrial complex.

A window into the space business

There is a built-in sabotage mechanism in the contracting process of SMIC companies, where prospective contractors bid on a project based on an impossible promise of what they will deliver at an impossible price. In most cases, companies make profits from change-orders and delays.

Take the James Webb Space Telescope, the high-tech, revolutionary telescope designed to outclass the Hubble, as an example.

Northrop Grumman, the American aerospace and defense technology developer, won the James Webb Space Telescope contract in 1996 with a promise that the project would cost $500 million and be flight-ready in 2007. The telescope is now likely to launch in 2021 and is expected to cost nearly $10 billion. That’s about 20 times the cost the company originally proposed.

To date, the James Webb Space Telescope has endured a remarkable 344 single-point failures. And with every delay and snafu, Northrop Grumman rakes in more money as missed deadlines extend the timeline and require more funding from the government. One delay in 2018 brought Northrop Grumman close to a billion dollars alone—twice the price the firm originally quoted to the government for the entire project.

In other words, SMIC companies are reaping giant rewards for something that should be penalized: a failure, a delay.

Although Congress has placed an $8 billion cap on the project spending, the telescope continues to bear enough breakthrough promise that it’s more or less assumed that someone will come up with the cash.

Government spending and project errors have become so alarming that the company was brought before the House Committee on Science, Space and Technology for a hearing, also in 2018. When CEO Wes Bush was asked to reveal details of his company’s annual profits, he refused to make them publicly available.

The James Webb Space Telescope is not just a telescope. It’s a parasitic sluice down which money flows, from the US government via NASA directly to Northrop Grumman.

And what is that money buying us? Not the implementation of the James Webb Space Telescope, that’s for sure.

NASA is paying to reinforce a system built on self-sabotage. It’s paying for false promises, failures, and delays. It’s paying to kick a hole in America’s global accomplishments.

What happened to gas stations in outer space?

The Space Launch System is also Boeing product—yes, the company that just fired its CEO, (he left with a reported $62.2 million in stocks and pension awards and a potential $80 million payout) and which is wrestling with the aftermath of being responsible for hundreds of casualties. At the root of the Boeing problem is the fact that 10 years ago, NASA had the opportunity to begin work on a program that included a deep space transport system that would have shuttled Americans into the solar system using existing rockets at a cost that NASA could have afforded.

Boeing held the key in a research project on fuel depots its engineers were carrying out at the time. Essentially, gas stations in outer space.

When you embark on any road trip or load your kids into the car to drive to Disneyland, you know that fuel will be available in gas stations along the way, meaning you know you can make it to your destination and back, even though your car has a relatively modest-sized gas tank.

If you had to carry your entire gas supply for the complete round trip, you’d be forced to haul a tanker bigger than your car.

Likewise, fuel depots in space would have made all sorts of things possible. We could have launched existing rockets like the Delta IV Heavy, refueled them in orbit, then sent them off to the destination of our choice—the moon, Mars, the moons of Jupiter, or perhaps the rings of Saturn.

Fuel depots in space would also have helped deliver the inflatable habitats, space homes, space hotels, and space stations that hotel magnate Robert Bigelow has been developing for nearly two decades.

Re-fueling stations in orbit could have meant doing all of this as early as five years ago.

But Boeing killed its propellant depot programs when it managed to snag something with more short-term profit potential: a contract for the Space Launch System, a Franken-rocket cobbled together from old parts and outdated technologies from the original Space Shuttle.

Backed by the head of the US Senate appropriations committee and Alabama senator Richard Shelby, most of the work on the rocket was slated to be carried out inside Alabama state, and the senator threw all his power into making the rocket a reality.

Pejoratively known in the space community as the Senate Launch System, the Space Launch System meant a cashflow of roughly $2 billion a year for Boeing.

Importantly, the Space Launch System was being paid for on the usual terms of the space military industrial complex: a cost-plus contract, that magic document that guarantees that the more change orders and delays a defense contractor can provoke, the higher it can balloon its profits.

Boeing on trial

When Congress called in Boeing’s president Muilenburg for questioning in 2019, legislators pointed out that Boeing should not be charging the government; it should be apologizing.

The company had promised to deliver the Space Launch System in 2015. By this point, it was four years late.

A July 31, 2019, tweet from George Sowers, who worked on the propellant depots and is now at the Colorado School of Mines, explained that he and his team had already established the viability of a refueling system.

Sowers continued:

The gag order went well beyond Boeing. Senator Shelby reportedly ordered a ban against talking about propellant depots where talk of propellant depots was needed most: NASA.

The underlying message to NASA was cross Shelby, and your funding will disappear.

Time is money

If Boeing had continued its work on propellant depots, that work would have someday revealed a bottom line. It would have revealed that the Space Launch System from which Boeing was making $2 billion a year was unnecessary. Beyond being a total and complete waste of money, it was a waste of something much more valuable—time. A full decade’s worth of it.

A robust fuel depot program might also have clued the public into the fact that the Space Launch System was way over budget, way behind schedule, and might not ever fly.

And if it ever does fly, the cost for a single launch could buy 22 launches of SpaceX’s heavy-lift launch vehicle, the Falcon Heavy.

As it turns out, putting all the chips on the Space Launch System and deep-sixing propellant depots was a bad long-term move not just for the United States, but for Boeing as well. Because no matter how many years (or decades) Boeing was able to stretch out the development of the rocket, profits would ultimately dry up at some point.

A space transport infrastructure based on launching existing rockets and refueling them in space would have created a sustainable long-term industry.

It’s a strategy that would have helped the US actually pioneer a space economy; an economy tapping the resources of asteroids and the moon, an economy that could have taken some of the massive resource burden off of Earth. An economy that could have harvested solar power in space, transmitting it to Earth, and eliminating the need for fossil fuels in energy production, thus cutting greenhouse gases by 45%. An economy that could eventually triple the world’s gross domestic product.

Establishing fuel stations in space would have helped the US take a space business that’s already worth $350 billion well past the trillion-dollar mark.

It also would have put Boeing smack dab in the middle of that burgeoning new business. When Boeing shut down its fuel depot development, it shut down an extraordinary US-led space future.

Safety … second?

The fear today is that the space military industrial complex is now applying the sort of tricks that Boeing pulled in killing propellant depots in another area vital to our nation: our military procurement program.

My fear is that when Boeing, Northrop Grumman, and Lockheed Martin create a new weapons system, they don’t look for what will work the best, be the least costly, and move the fastest. They look for what will be the most profitable.

We should all be afraid that the space military industrial complex sells us vastly overpriced yet ineffective weapons. I’m afraid that our war planes will experience software problems like the ones that crashed two Boeing 737 Max aircraft and that kept Boeing’s Starliner capsule from reaching the ISS.

In a war, the high price of planes can kill you. In World War II, the US produced 10 aircraft carriers for every one Japan turned out. That’s one reason the Japanese lost and we won. Today, both China and Russia are outpacing the US in terms of military equipment production, including planes.

In a war, those who can produce the most weapons, and the best weapons, win.

The space military industrial complex has knifed the US space program in the back. And I’m afraid it might be doing the same to the US military.