SpaceX Is Saving Taxpayer Money

Taxpayers will benefit from the new private space race

Between the continuing Coronavirus pandemic, and riots and looting across the country, Americans don’t have much to be excited about, but on May 30, SpaceX gave stressed-out Americans a welcome distraction.

For the first time in nine years, two NASA astronauts launched into space from U.S. soil. The flight marked the start of a brave new era in private spacefaring, proving that government spacecraft are no longer needed to breach the skies. Taxpayers can rest easy knowing that future trips to space won’t carry astronomical expenses. Space is the distraction we all need right now, and it won’t break the bank to get there.

When NASA astronauts entered the Crew Dragon spacecraft for the first time, they got a whiff of the “new car smell” not normally associated with decades-old shuttles. Ironically, unlike in the automobile market, this new car smell carries with it a cheaper price tag than its dated counterparts.

Prior to the Crew Dragon getting up-and-running, the US had to pay the Russians around $86 million per seat (round-trip) to get NASA astronauts to and from the International Space Station (ISS). This was a hefty price, but as NASA’s Inspector General (IG) noted, “Since the end of the Space Shuttle Program in 2011, the Russian Soyuz vehicle has served as the sole means of transporting astronauts to and from the ISS.” In the absence of a viable alternative, Russia felt free to charge whatever they wanted to ferry Americans to and from ISS.

Fortunately, NASA started working with aerospace companies to develop private, crewed missions as an alternative to building its own shuttles or relying on foreign space agencies. SpaceX and Boeing have quickly leaped into the fray, with SpaceX’s Crew Dragon spacecraft ultimately winning the private “space race” for the first crewed mission.

At a $55 million per seat price, the Crew Dragon is a bargain compared to the Russians’ $86 million fares. Boeing is still testing out its rival Starliner spacecraft, but serious cost issues and reliability concerns plague the project. NASA’s IG estimated that Boeing will be charging $90 million per seat on the Starliner, costing taxpayers more than under the already cost-prohibitive status-quo.

The agency watchdog further noted that Boeing has been charging NASA inflated costs despite failing to deliver its capsule on time. According to the IG, “NASA agreed to pay an additional $287.2 million above Boeing’s fixed prices to mitigate a perceived 18-month gap in ISS flights anticipated in 2019 and to ensure the contractor continued as a second commercial crew provider, without offering similar opportunities to SpaceX.”

Naturally, Boeing didn’t take kindly to these findings and attempted to rebut the IG. The company pushed back against “any implication that we ever wavered in our participation in Commercial Crew” and trumpeted their “significant investments” in the Commercial Crew program. But of course, large investment sums are little consolation to taxpayers if resulting costs are out of whack with competitors—and reality.

Since the November 2019 release of the IG report, things haven’t been easy for Boeing.

On December 20, the Starliner capsule debuted for an uncrewed test run to and from the ISS but failed to dock to the space station and circled Earth in the wrong orbit for two days. Boeing will continue to test improvements to the Starliner and keep trying to make its capsule a viable option for NASA.

Hopefully, rival aerospace companies can continue to keep SpaceX on their toes by offering effective, cost-competitive options for private crewed flights. By bringing competition into the market, the private space race offers plenty of promise for reducing costs to taxpayers and ensuring safe, efficient spacefaring operations. A brave new era in space exploration has begun, and commercial ingenuity and entrepreneurship will take center stage.

Ross Marchand is a Catalyst Policy Fellow and the director of policy for the Taxpayers Protection Alliance. He focuses on a range of issues, ranging from health-care reform to internet regulation to Postal Service-related issues. Ross is an alumnus of the Mercatus Center MA Fellowship at George Mason University, where he received his MA in economics in 2016. He has interned for the Texas Public Policy Foundation and the American Legislative Exchange Council, analyzing and blogging on a variety of public policy issues.
Catalyst articles by Ross Marchand