LIVE: Congressional Hearings into Obama's NASA Budget FY2011 - Feb 24-25 Part 2

[Danderman]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.

 

[Robotbeat]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.

 

Heh. "Government option." Assuming he was talking about the senators in the congressional hearing, do they hand out awards for hypocrisy?

[Danderman]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.

 

Heh. "Government option." Assuming he was talking about the senators in the congressional hearing, do they hand out awards for hypocrisy?

Right. The Republicans want to preserve the Public Option for human spaceflight, whereas Obama wants the private sector to operate transportation services. Scott Pace seems to be more comfortable with the Public Option.

[Namechange User]

Well, the dilemma the Administration faces is that if you preserve our existing manned launch facility, the Shuttle, the expense and mindshare it requires could easily stunt any emergent launch market. For the two billion or so dollars a year the Shuttle needs, you could easily support a half dozen commercial launchers once a robust market is established and they're all going at each other on price and capabilities, especially if ITAR is relaxed and American aerospace can offer services to the rest of the world with fewer hinderances.

<snip>

It's all a matter of Congress willing to pay the $2B/year for three years plus whatever fees are incurred in privatization. If a public offering is made on the stock market, there will be some infusion of private funds to help, but I've no idea how much that could turn out to be.

While I appreciate the comment on the "commercial" shuttle, what is your justification and data to support the rest?

Describe the "mindshare" that is the Shuttle Program.  How exactly does it "stunt" the emergence of "commercial" providers?

Why is 2 billion sufficient to support a half dozen launchers (presumably you are talking about the spacecraft, not the launchers that you keep using interchangibly)?  How do you know that?  Please elaborate on what you believe is necessary to sustain a spacecraft or rocket.  Where does this robust market come from when ISS is the only current destination?  How is that "robust" market maintained in that light without government funding, funding beyond just purchasing services?

What fees are required for "privatization" and define how you use that term please.

I look forward to seeing your response with the appropriate data to back-up all these claims. 

[kraisee]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.

 

Heh. "Government option." Assuming he was talking about the senators in the congressional hearing, do they hand out awards for hypocrisy?

I am a strong proponent of the new Commercial sector.   I have high hopes for it.   But I'm not blind.   There are some legitimate grounds for concern here.

The House Committee raised concerns with the President's Budget Draft, where it indicates that the COTS competitors are now going to be 62% over-budget on the Cargo-to-ISS contracts (note: that's completely separate from the CCDev Crew activities, which are accounted for as a totally different budget line item, before anyone asks).

The Budget Draft increases the remaining Commercial ISS COTS Cargo contracts from $51.3m over the next two years, to $312m in FY11 alone.   That is on top of the $433.5m already agreed and paid.

Any way you cut it, that's a 62% cost increase on the Cargo contracts.


Obama's plan is now to place all of the country's Crew capability eggs into these same hands, at a time before they have even proven they can deliver Cargo on-time, and while they are having clear difficulties doing so on-budget.

Why shouldn't Congress be a little concerned about such large and unplanned increases?

Boeing and Lockheed Martin get asked some pretty serious questions by Congress if/when their projects go 62% over budget too. So why shouldn't Space-X and OSC be held to the same standards?

Ross.

[Robotbeat]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.

 

Heh. "Government option." Assuming he was talking about the senators in the congressional hearing, do they hand out awards for hypocrisy?

There are some legitimate grounds for concern here.

The House Committee raised concerns with the President's Budget Draft, where it indicates that the COTS competitors are now going to be 62% over-budget on the Cargo-to-ISS contracts (note: that's completely separate from the CCDev Crew activities, which are accounted for as a totally different budget line item, before anyone asks).

The Budget Draft increases the remaining Commercial ISS COTS Cargo contracts from $51.3m over the next two years, to $312m in FY11 alone.   That is on top of the $433.5m already agreed and paid.

Any way you cut it, that's a 62% cost increase on the Cargo contracts.


Obama's plan is now to place all of the country's Crew capability eggs into these same hands, at a time before they have even proven they can deliver Cargo on-time, and while they are having clear difficulties doing so on-budget.

Why shouldn't Congress be a little concerned?

Boeing and Lockheed would also get asked questions by Congress when their projects go 62% over budget too.   Why shouldn't Space-X and OSC be held to the same standards?

Ross.

Why not the "same standard"? Well, for one thing, SpaceX and OSC are offering a service that is still far less expensive than the other ways of doing it. You judge the cost of their service based on the delivered cost, not on their promised cost or the difference between promised cost and delivered cost. Delivered cost ought to be the "same standard," not different methods of cost projections. If SpaceX and OSC cost more than Boeing et al for the same delivered service, then fine, give the business to Boeing et al.

[mars.is.wet]

"Most people," Mr. Pace said, "are uncomfortable with not having a U.S. government option" to transport astronauts to orbit and beyond."

Thanks, Scott.


 

Heh. "Government option." Assuming he was talking about the senators in the congressional hearing, do they hand out awards for hypocrisy?

Amazing statement coming from a dyed-in-the-wool Republican with a picture of Dick Cheney and the Bushes on his wall.

[robertross]

Why not the "same standard"? Well, for one thing, SpaceX and OSC are offering a service that is still far less expensive than the other ways of doing it. You judge the cost of their service based on the delivered cost, not on their promised cost or the difference between promised cost and delivered cost. Delivered cost ought to be the "same standard," not different methods of cost projections. If SpaceX and OSC cost more than Boeing et al for the same delivered service, then fine, give the business to Boeing et al.

Huh??


Um...ask this in 2013-2014 when the bill comes in MORE* than 62% over budget and say, "okay, let's try this again". We don't the time to start over.

*This assumes (correctly AFAIK) that CCDev will be more expensive to develop because it includes capsule recovery & all the things that go along with a manned launch and recovery process)

[Robotbeat]

Why not the "same standard"? Well, for one thing, SpaceX and OSC are offering a service that is still far less expensive than the other ways of doing it. You judge the cost of their service based on the delivered cost, not on their promised cost or the difference between promised cost and delivered cost. Delivered cost ought to be the "same standard," not different methods of cost projections. If SpaceX and OSC cost more than Boeing et al for the same delivered service, then fine, give the business to Boeing et al.

Huh??


Um...ask this in 2013-2014 when the bill comes in MORE* than 62% over budget and say, okay,let's try this again. We don't the time to start over.

*This assumes (correctly AFAIK) that CCDev will be more expensive to develop because it includes capsule recovery & all the things that go along with a manned launch and recovery process)

Well, ability to recover hardware from the ISS is a rather valuable service. And OSC isn't trying to recover the hardware, but are still spending more than SpaceX.

This whole discussion kind of boils down to whether or not we think it's possible to improve upon the current costs of ISS servicing.

[Danderman]

If SpaceX and OSC are somehow 62% over budget for COTS, that is big news. Is this for the first Space Act agreements, or is the overage for the follow-on cargo delivery contracts?

[robertross]

Why not the "same standard"? Well, for one thing, SpaceX and OSC are offering a service that is still far less expensive than the other ways of doing it. You judge the cost of their service based on the delivered cost, not on their promised cost or the difference between promised cost and delivered cost. Delivered cost ought to be the "same standard," not different methods of cost projections. If SpaceX and OSC cost more than Boeing et al for the same delivered service, then fine, give the business to Boeing et al.

Huh??


Um...ask this in 2013-2014 when the bill comes in MORE* than 62% over budget and say, okay,let's try this again. We don't the time to start over.

*This assumes (correctly AFAIK) that CCDev will be more expensive to develop because it includes capsule recovery & all the things that go along with a manned launch and recovery process)

Well, ability to recover hardware from the ISS is a rather valuable service. And OSC isn't trying to recover the hardware, but are still spending more than SpaceX.

This whole discussion kind of boils down to whether or not we think it's possible to improve upon the current costs of ISS servicing.

Well the current method of servicing the ISS is getting cancelled, though it (shuttle) may well get a new lease on life. But we all understand this is short-lived until commercial can perform & provide. So it's not about difference in cost between shuttle vs. commercial in the short term, since there is no possible way to have commercial crew in the short term. And in the long term, it will only be commercial.

The problem is reliance on an unproven concept, when you have so much at stake. Yes, I am fully aware of the PoR, and how Congress was short sighted to enable the alternative: maintaining shuttle.

But congress sees this issue, the issue of getting one shot at it, and you can't go back and start over. Maybe they have learned something, even if it perceived by many as too late. They see this open-ended contract where the commercial providers can come back and demand more for the service, because NASA's hands are tied. Much like the position we are in with Soyuz flights and how they will demand more money for these flights.

[Namechange User]

If SpaceX and OSC are somehow 62% over budget for COTS, that is big news. Is this for the first Space Act agreements, or is the overage for the follow-on cargo delivery contracts?

Given that neither of those vehicles exist yet and are operational, it would clearly seem to be the first.  I think what you are seeing here is the first signs that even "commercial" runs into problems, contrary to what some would suggest. 

Not sure how they can be "over" on delivery if they haven't delivered anything yet.

[Lee Jay]

Not sure how they can be "over" on delivery if they haven't delivered anything yet.

I find it unlikely that vehicle delivery is the only deliverable in those contracts.

[Namechange User]

Not sure how they can be "over" on delivery if they haven't delivered anything yet.

I find it unlikely that vehicle delivery is the only deliverable in those contracts.

Indeed and I never said otherwise.  They have clearly not met all the milestones layed out in the first Space Act Agreements, otherwise we would at least be in "demo" mode now.  Therefore, it is logical to assume that those cost increases come from just getting through those milestones associated with the first Agreements. 

[Danderman]

Again, on the reported 62 percent overage, it would good to get some specifics rather than guesses.

As for the claim that because one commercial provider goes bad it means that all commercial providers are bad, well, that just doesn't fly, unless you are living in the Workers Paradise. After all, 90% of all restaurants fail in the first 6 months, but it doesn't mean that the government should take over the restaurant business.

We clearly should not pursue the Public Option in space.

[jimgagnon]

While I appreciate the comment on the "commercial" shuttle, what is your justification and data to support the rest?

Describe the "mindshare" that is the Shuttle Program.  How exactly does it "stunt" the emergence of "commercial" providers?

Why is 2 billion sufficient to support a half dozen launchers (presumably you are talking about the spacecraft, not the launchers that you keep using interchangibly)?  How do you know that?  Please elaborate on what you believe is necessary to sustain a spacecraft or rocket.  Where does this robust market come from when ISS is the only current destination?  How is that "robust" market maintained in that light without government funding, funding beyond just purchasing services?

What fees are required for "privatization" and define how you use that term please.

I look forward to seeing your response with the appropriate data to back-up all these claims. 

I believe my comment was that I didn't think privatization of the Shuttle was financially viable, but perhaps someone else would be willing to try. That's the gist of a 2002 Rand report:
      http://www.rand.org/scitech/stpi/NASA/nasaExecSum_final.pdf
      http://www.rand.org/scitech/stpi/NASA/nasaFinalRpt.html
Congress today may have a different idea; you would have to ask them. Depends upon how badly one wants to preserve the Shuttle.

Forbes also talked about Shuttle privatization in the wake of the Columbia disaster:
      http://www.forbes.com/2003/02/03/cx_ah_0203space.html
They weren't too keen on it either.

Mindshare would come from the fact that without the Shuttle and Constellation, there is only one way forward: the private launch companies. Personnel who are working right up to the end improving Shuttle systems and procedures would be able to turn their undivided attention to the private companies, to help them more easily enter space.

As it stands today, there's very little public information on the financing required by the existing private new space companies. They have no public obligation to report numbers, so that's understandable. From what I understand, both SpaceX and Bigelow have plunked down something in the neighborhood of a quarter of a billion dollars in start-up money over a period of about ten years. SpaceX's contract with NASA calls for 12 supply flights for a total of $1.6B, for about $130M/flight (they're making money on this contract, by the way). Let's assume we have a fat field of six companies competing for services in a few years, and it's in NASA's interests to keep them all alive. $2B divided by six is about $330M/year for each, or two and a half of SpaceX's initial price on a supply flight. That just might be enough to keep a company alive and still flying, even assuming they're unable to drum up any other business outside of NASA's ISS efforts.

The fewer companies that are able to past muster, the $2B goes even farther. Once all these companies are flying, you would begin to see downward pressure on prices. Note that if only one to three companies are able to provide services, the price pressure lessens as an industry cabal can form; that's why you really want a wide open market with four or more competitors.

As far as privatization fees, that really does depend on specifics of the various Shuttle contracts, which facilities you want to transfer to the new company, etc. I'm not privvy to that information. Frankly, privatization can take many forms, each with their own strengths and weaknesses.

As I said earlier, privatization of the Shuttle is something I would not personally pursue. If Congress would pony up an extra $2B/year, I would simply extend the Shuttle a few years to help close the gap. However, if someone puts their foot down and demands the Shuttle remain operational, privatization is the only way you can keep it running while allowing the commercial guys to compete on a level playing field.

PS: after writing this, I see some talk of a 62% increase in the cost of ISS cargo supply. It's not clear to me if that's purely SpaceX costs or not. If so, then my numbers here will need some adjustment; however, I did chose a high figure of six for the number of operational private carriers. Since the number is more likely to be four, that does leave plenty of wiggle room.

[neilh]

Indeed and I never said otherwise.  They have clearly not met all the milestones layed out in the first Space Act Agreements, otherwise we would at least be in "demo" mode now.  Therefore, it is logical to assume that those cost increases come from just getting through those milestones associated with the first Agreements. 

Your assumption is incorrect. The $312M increase is to cover additional flights and milestones, on top of those already arranged for under COTS.

http://www.spacenews.com/civil/nasa-raises-bet-commercial-cargo.html

NASA Chief Financial Officer Elizabeth Robinson said that the additional cargo funds are intended to pay for more tests and demonstration flights by the two COTS providers, Orbital and SpaceX.

“A lot of our efforts are ongoing in terms of trying to develop the details,” Robinson said in a Feb. 18 interview. “The goals of the money are to initiate new tests and demonstration flights, initiate, some enhanced capabilities, and things along those lines.”

Robinson said keeping the space station in service through at least 2020 will have an impact on the agency’s commercial cargo requirements.

“We’re also talking about fully utilizing the station in terms of the research,” she said. “The kinds of cargo that will go up and down are also evolving just because of the sheer magnitude of the work that’s going to be going on there. I think part of what this $312 [million] is for is to enable that.”

http://www.nasa.gov/pdf/428356main_Exploration.pdf

This budget allocates $312.0 million in FY 2011 for incentivizing NASA’s current commercial cargo program to improve the chance of mission success by adding or accelerating the achievement of already-planned milestones, adding additional capabilities, or tests that may ultimately expedite the pace of development of cargo flights to the ISS. Risk reduction activities may include adding milestones to complete the Probabilistic Risk Assessment (PRA) to identify early risks. Accelerating enhanced capabilities may include adding milestones for early development of items such as the high energy engine for Orbital’s Taurus II upper stage, and Block 2 engine upgrades SpaceX’s Falcon 9; a demonstration flight may be added to validate the upgrades. NASA will continue to evaluate the Cargo Resupply Services (CRS) contract to determine if funds can be used to accelerate hardware fabrication and assembly of the CRS vehicles.

It's also worth noting that the $312M extra NASA will be paying for orbital cargo deliveries is substantially less than the $0.5B it paid for the suborbital Ares I-X.

[robertross]

neilh: that quote from the budget is so vague...there are ifs and maybes all through it.

The biggest proof: "...to improve the chance of mission success..."

So clearly they are not confident in the current plan being a success.

[Namechange User]

Indeed and I never said otherwise.  They have clearly not met all the milestones layed out in the first Space Act Agreements, otherwise we would at least be in "demo" mode now.  Therefore, it is logical to assume that those cost increases come from just getting through those milestones associated with the first Agreements. 

Your assumption is incorrect. The $312M increase is to cover additional flights and milestones, on top of those already arranged for under COTS.

http://www.spacenews.com/civil/nasa-raises-bet-commercial-cargo.html

NASA Chief Financial Officer Elizabeth Robinson said that the additional cargo funds are intended to pay for more tests and demonstration flights by the two COTS providers, Orbital and SpaceX.

“A lot of our efforts are ongoing in terms of trying to develop the details,” Robinson said in a Feb. 18 interview. “The goals of the money are to initiate new tests and demonstration flights, initiate, some enhanced capabilities, and things along those lines.”

Robinson said keeping the space station in service through at least 2020 will have an impact on the agency’s commercial cargo requirements.

“We’re also talking about fully utilizing the station in terms of the research,” she said. “The kinds of cargo that will go up and down are also evolving just because of the sheer magnitude of the work that’s going to be going on there. I think part of what this $312 [million] is for is to enable that.”

http://www.nasa.gov/pdf/428356main_Exploration.pdf

This budget allocates $312.0 million in FY 2011 for incentivizing NASA’s current commercial cargo program to improve the chance of mission success by adding or accelerating the achievement of already-planned milestones, adding additional capabilities, or tests that may ultimately expedite the pace of development of cargo flights to the ISS. Risk reduction activities may include adding milestones to complete the Probabilistic Risk Assessment (PRA) to identify early risks. Accelerating enhanced capabilities may include adding milestones for early development of items such as the high energy engine for Orbital’s Taurus II upper stage, and Block 2 engine upgrades SpaceX’s Falcon 9; a demonstration flight may be added to validate the upgrades. NASA will continue to evaluate the Cargo Resupply Services (CRS) contract to determine if funds can be used to accelerate hardware fabrication and assembly of the CRS vehicles.

It's also worth noting that the $312M extra NASA will be paying for orbital cargo deliveries is substantially less than the $0.5B it paid for the suborbital Ares I-X.

I think this quote proves exactly what I was saying.  "Improve the chance of success", "additional tests", etc.  Hmmm, guess it is rocket science after all. 

Was that an attempted dig at me for some reason on Ares 1-X?

[Namechange User]

From what I understand, both SpaceX and Bigelow have plunked down something in the neighborhood of a quarter of a billion dollars in start-up money over a period of about ten years. SpaceX's contract with NASA calls for 12 supply flights for a total of $1.6B, for about $130M/flight (they're making money on this contract, by the way). Let's assume we have a fat field of six companies competing for services in a few years, and it's in NASA's interests to keep them all alive. $2B divided by six is about $330M/year for each, or two and a half of SpaceX's initial price on a supply flight. That just might be enough to keep a company alive and still flying, even assuming they're unable to drum up any other business outside of NASA's ISS efforts.

So, does the "price per flight" equate to covering the operating costs of the entire company, or that division at least, for a period of time before the next flight and the next infusion of money?

The answer in many cases is probably not entirely and therefore it will probably require sustainment from either corporate funds, which is not going to be popular if a business is continuously in a defecit mode, or the government is going to have to continue to step in in order to keep them afloat.