Category Archives: Economics

Ann Arbor Follies

Should students have to pay to get a newspaper they don’t want to read? I know Pinch is in trouble, but this reeks of desperation. But then, it’s been a long time, if ever, that the paper had any interest in letting the market work. And now would be a very bad time for it to advocate it, given that “letting the market work” would mean a reorganization, in which one likely outcome might be a paper that people actually want to pay to read.

Falcon 9 Heavy

I’m watching the press conference now. Clark Lindsey is live blogging it.

I’d say that the big news is that it’s got more payload than expected, and will mean previously unthinkable price per pound. It is also big enough to do any conceivable planetary mission one would want, in sufficient numbers. The one question I wish that someone would ask is fairing size.

[Update a while later]

Clark has the press release.

[Update later in the morning]

Apparently I mistitled the post. It’s not a Falcon 9 Heavy, it’s a Falcon Heavy. I’m not sure what this means, other than the upgraded engines. Is is a different upper stage as well? It’s not obvious from the press release. Time to ask SpaceX.

[Update late morning]

Here’s the SpaceX simulation:

That Aerospace Study

I was out of town for the weekend, and hadn’t had a chance to look at this briefing, which purports to show that Commercial Crew is a bad deal for NASA. While one suspects that this was the goal of those who commissioned it, ironically, it actually does the opposite.

I should preface this by saying that I’ve known John Skratt for about a quarter of a century, and worked with him quite a bit, and he’s a veteran cost analyst and a straight shooter. In fact, I left him a phone message last week, having no idea that this was in work, suggesting that we get together to discuss the situation with the broken cost models. In retrospect, I’m now unshocked that he hasn’t yet returned the call.

The real problem with the paper (as is often the case, unfortunately — it’s a lot easier to challenge such things when there are flaws in the math or logic) is in the assumptions. Every single one of them on charts 3 and 4 are nonsensical. I’m going to make the assumption that they are not John’s, but perhaps those who asked him to do it (with input from the Hill?). Thus, garbage in, garbage out, as the Commercial Spaceflight Federation points out in devastating detail.

But as frequent Space Politics commenter “Major Tom” also points out (scroll way down, it’s currently the bottom of a 150-comment post), even with these nutty assumptions, it’s still cheaper than a NASA solution:

The report’s bottom line is that under multiple worst-case conditions (halved NASA business, commercial customers at a loss, new LV developments, oppressive safety regime, etc.), NASA could expect to pay ~$20 billion for commercial crew development and ten years of operations.

That’s half of what Ares I/Orion development would have cost ($35-40 billion). It’s equivalent to what SLS/MPCV development will cost ($16 billion-plus for Shuttle-derived SLS plus another ~$5 billion for an Orion-based MPCV). Neither of those option even get to operations before blowing $20 billion.

Per the Commercial Spaceflight Federation, the study is conservative to a fault.

But even with all that conservatism and all those worst-case conditions, commercial crew still comes out ahead of Shuttle-derived solutions like Ares I/Orion or SLS/MPCV by a factor of 2-4.

Expect it, though, to be trumpeted by the defenders of the status quo as the death knell for the nutty notion of having actual competition in human spaceflight.

[Mid-afternoon update]

Funny, John returned my call this afternoon. I don’t know if it was in response to this post (I doubt it), but the conversation was cordial. And interesting. But unfortunately, off the record.

Yes, I know it’s a tease, but I thought I should at least mention that we did finally talk.

A Static Analysis

Paul Spudis says that propellant depots are a necessary but not sufficient condition for opening up the solar system.

Well, in the long run, sure. But as Clark Lindsey notes, in the short term, I think that a dollar spent on reducing launch costs will have a lot higher ROI than a dollar spent on getting propellant from the moon. That’s just the harsh economic reality, largely because reducing launch costs is a very low-hanging fruit, given how ridiculously and unnecessarily high they currently are. Elon has already started to show the way, and fully reusable space transports that develop out of the suborbital and other markets will accelerate the process. Once we solve that problem (and it won’t take that long, once we get serious about it, which will start when the markets flower), then ISRU will start to look a lot more attractive, because doing it will be a lot cheaper as well.