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NASA's 'Shuttlyndra' a Massive Waste of Tax Dollars

This is a tale of a government investment gone far awry. Favored by politicians promising jobs in a high-tech industry of the future, and fueled by political cronyism, it consumed untold amounts of taxpayer dollars, with little to show for it, despite warnings by experts that its business plan was flawed.

No, it’s not Solyndra -- it’s much worse, at least in terms of the amount of money proposed to be wasted on it, and in other ways as well.

Let’s call it “Shuttlyndra,” aka NASA's Constellation, then called the Space Launch System, aka the Senate Launch System. The Solyndra scam wasn’t a federal contract per se -- it was based on taxpayer-guaranteed loans, which meant that the taxpayers would never have to pay off if it had worked. Shuttlyndra isn’t just a contract, but multiple sole-source, no-bid, cost-plus contracts, guaranteeing that the taxpayer money will be spent. And because of the nature of the contracts, in which the contractors are reimbursed for time and materials regardless of results, and there is no real competition, there is an excellent chance that the taxpayer won’t get much for the money -- at least if its predecessor program, Constellation, is anything to go by.

NASA spent ten billion dollars on Constellation over five years, and had little to show for it except a very expensive and flawed suborbital test of a dummy first stage, and a half-built capsule with uncertain requirements. There is absolutely nothing to indicate that anything has changed in terms of management at NASA to overcome the ongoing moral hazards that created the waste the first time. It is really an intrinsic feature of traditional NASA contracting that has resulted in failure after failure after failure of NASA programs in their stated purpose. These failures are never punished because in the minds of those primarily responsible for funding it on the Hill, the real purpose is that the jobs continue to flow.

The saddest thing, perhaps, is that, unlike the supposedly novel approach to solar cell production ostensibly being pioneered by Solyndra, it’s not even particularly high technology. The program is premised on the notion that we have to maintain the same decades-old “space infrastructure” that we’ve had since the 1970s, by continuing the obsolete and costly Shuttle technology into perpetuity. At least if Solyndra’s promises had been kept, we would have had a useful new technology. But all that SLS gives us is a heavy-lift vehicle that will fly rarely, for which no payloads have been defined or budgeted.

But the biggest difference between Solyndra and Shuttlyndra is the scale of the waste of taxpayer funds -- and that'signoring the billions already wasted. Shuttlyndra is planned to consume eighteen billion dollars in the next few years, and much more before it can do anything useful. Compared to that, the half billion wasted on Solyndra is couch-cushion change. And Shuttlyndra will be the negative gift to the taxpayer that keeps on giving, eating up billions of dollars per year that could be spent on actual useful space hardware for sending humans beyond earth orbit, until it’s finally canceled (if the porkmeisters in Congress ever allow it to happen).

It was easy to see, even in prospect, that Solyndra was doomed to failure, to all except those who actually decided to throw taxpayer largess at it.

Similarly, independent analyses of Shuttlyndra, from the Aerospace Corporation to the Government Accountability Office to the Augustine Panel to the recent report by Booz Allen Hamilton, all indicate that it is unneeded, or unaffordable within any realistic budget NASA can expect to get, or both and that its costs are likely to be much higher than any current estimate. This means that, in the coming if not current fiscal environment, it is doomed to cancellation. The only real question: how many more taxpayer billions will be poured down the drain before it happens?

It would be nice to think that we could fix this by electing more Republicans, but as Tim Carney pointed out a few days ago, they’re just as guilty of this sort of thing:

The problem is not that Obama’s administration is bad at picking investments. Nor is Obama, among politicians, corrupt or unusually given to cronyism. The problem is that Obama’s stated agenda, which involves giving government a central role in the private sector, inevitably creates waste, gives benefits to the well-connected, and opens the door for cronyism and corruption.

Obama promised to be the scourge of the lobbyists and the antidote to special-interest dominance in Washington, but he also promised an activist government role in the economy. The two are nearly mutually exclusive.

Some Republicans, to their credit, are driving this idea home. Newt Gingrich in last week’s debate pointed out the incompatibility of Obama’s call to close tax loopholes and his steady push for “green energy” tax subsidies. House Speaker John Boehner criticized Obama’s Big Government policies for creating “a government that favors crony capitalism and businesses deemed ‘too big to fail’ over the small banks and small businesses that make our economy go.”

In the House hearing on Solyndra, though, Republicans alternated between the typical congressman-bullying-a-witness schtick, and trying to paint Obama’s DOE as unusually inept. The more accurate and politically relevant point is that government agencies simply aren’t well-equipped to be economic players, and that political decisions will always drive government investments, whether the president is named Bush, Obama, Perry or Romney.

Similarly, as long as NASA is viewed by Congress as a jobs program, rather than an agency charged with carrying out our actual space activities for the benefit of the nation, it won’t matter what the presidents are named, either. NASA’s Commercial Crew Program actually has multiple redundant competitive providers, on fixed-price contracts (in which the money isn’t paid if the milestone isn’t met), to develop a capability that the space agency actually needs -- getting crew to and from the space station to eliminate the nation’s dependence on the Russians, at a much lower cost than it can do so itself with a non-redundant system.

Yet with no sense of irony whatsoever, some illogical commenters have absurdly (and repeatedly) called this program “crony capitalism,” while having no apparent problem with Shuttlyndra. Campaign contributors from the contractors in states like Florida, Texas, Alabama, and Utah lobby their representatives and senators for their support. In return for which, they pay no attention to the numerous analyses pointing out the problems, and they write legislation that can only be followed by NASA giving them the aforementioned no-bid contracts. And there are as many, if not more, Republicans in on the chicanery as Democrats.

If that’s not the true crony capitalism of the space program, and on a grand scale, what is?

Fortunately, there is a little hope that sanity might eventually reign. Representative Dana Rohrabacher (R-CA) has recently been prodding NASA to release embargoed data on studies it has done indicating how it could do exploration without the need for such a horrendously expensive vehicle. At the big annual space meeting of the American Institute of Aeronautics and Astronautics in Long Beach last week, I saw a presentation by Boeing that described an exploration architecture whose largest piece was only twelve metric tons (about ten percent of the proposed size of the Senate Launch System) that could support a lunar base of dozens of people.

Recently, Republican Representative Tom McClintock, also of California, cheered on by the Tea Party in Space, urged the General Accountability Office to investigate the space agency for violation of the 1984 Competition in Contracts Act with its extensive use of no-bid sole-source contracts. That, combined with the coming fiscal crunch for agencies across the board, could yet put a shotgun blast through the brain of this zombie program that continues to plod on, stomping on prospects for actual space progress. But unlike Solyndra, Shuttlyndra won’t be over soon, or easily.