Sputnik capitalism

25 May 2016 By Gina Chon Follow @GinaChon

Elon Musk’s SpaceX just broke the monopoly on military satellite launches enjoyed by the defense contractors’ alliance. Congress may help the pricey venture by allowing it to buy more sanctions-tainted Russian rocket engines. That’d be a strike against efficiency and innovation.

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The U.S. Senate this week is considering a defense-spending bill that would allow the United Launch Alliance, a joint venture of Lockheed Martin and Boeing, to purchase more Russian-made rocket engines for satellite launches conducted on behalf of the U.S. Air Force. The House of Representatives on May 17 passed a version of the bill that increases the engine purchases from nine, the amount approved in last year’s spending bill, to as many as 18.

Senator John McCain, chairman of the Armed Services Committee, opposes the move and backs a proposal under which, once the nine rocket engines are used, the Defense Department would not be allowed to use any more. Restrictions on the engines were introduced after Russia’s annexation of Crimea.

Elon Musk’s SpaceX sued to compete for Air Force launch contracts and settled in 2015. In April, the Air Force awarded an $83 million contract to SpaceX to launch a satellite. The fixed-price award was the military’s first competitively sourced launch contract in more than a decade, ending an exclusive relationship with the United Launch Alliance.

Lieutenant General Samuel Greaves, head of the Air Force’s Space and Missile Systems Center, told reporters that the SpaceX launch price was an estimated 40 percent less than the cost of previous missions.

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