• COMMENTARY: Elon Musk’s Shell Game Goes Up In Smoke

    Earlier this month, an unmanned SpaceX rocket, manned with Facebook’s Israeli Satellite, blew up during a test firing.

    The Falcon 9 rocket was being fueled when the mix of rocket-grade kerosene propellant and liquid oxygen reacted, causing a huge explosion that was felt across Florida. Communities up to 40 miles away heard the several explosions and noted seeing pillowing black smoke coming from Cape Canaveral Air Force Station.

    In response, NASA tweeted:

    Unfortunately, this response fell on closed ears. Just 14 months prior, SpaceX had experienced a very similar failure – the Falcon 9 launch blew up, carrying millions in gear for the International Space Station.

    If NASA expects that their partners learn from their setbacks, shouldn’t SpaceX learn from theirs?

    This should especially be the case because SpaceX receives $5.5 billion dollars in governmental incentives, contracts, and subsidies. SpaceX, just like the United Launch Alliance, must be held accountable for every single one of its mistakes – especially because the American taxpayer is paying the price of every failed launch.

    “The Falcon 9 up till now was very reliable,” Uzi Rubin, former chief of Israel’s missile defense program. Rubin goes on to explain that it is very unusual that a mishap happened during the launch preparations.

    You only need to watch the first 1:46 of the below video to see how quickly millions of dollars goes up in a Hollywood style explosion:

    But regardless of the science, the way that Elon Musk has received the incessant aid and capital to fund his pet projects are outrageous. Unlike the United Launch Alliance, SpaceX receives low cost and low interest loans from the U.S. government. These loans are long-term and low-risk for SpaceX, although the loans are short-term and high-risk for the American taxpayer.

    As seen by the current events, if there is another failure, taxpayers see no future of being paid in the form of useful output. In other words, Elon Musk has legally stolen money from the public, without any fear of flak.

    For that reason, Elon Musk can funnel and play his shell game with his three companies, SpaceX, Tesla, and SolarCity. He can move money in and out, while packaging the three companies together and arguing that he is the only one who can save the world from himself. Elon Musk may speak positively about the future of his companies, but he is the first to point out that the earth is destined to fail.

    But how can we assume that his rockets will even save us when they are on average delayed 2 years? Because of this recent failure, according to Phil Smith, senior space analyst at the Tauri Group, “it is clear there will be some sort of delay… they had nine launches lined up… and that will affect the schedule.” This news may sound unfortunate in the wake of the current events, but astute investors see this as no different than the usual SpaceX modus operandi. SpaceX’s track record is just too easy to see as unpredictable and unsafe.

    Now, SpaceX has destroyed two brand new rockets, yet it still claims that it will recycle its old Falcon 9 rockets.

    But what is worse is that Musk hides failure behind crafty rhetoric. Using fear, Musk is able to convince policy makers to bend to his will – except that not all politicians are privy to those feelings.

    Senator John McCain is being investigated by the government for his close cozy relationship with Musk. Senator McCain has received tens of thousands in donations from Musk’s companies. Similarly, thousands more are spent on lobbyists to represent SpaceX, Tesla, and SolarCity on Capitol Hill.

    Money spent purely out of favoritism is the dictionary definition of cronyism. This trend cannot continue when there are several other practical partnerships in the market, among them: Jeff Bezos’ Blue Origin and Richard Branson’s Virgin Galactic.

    SpaceX and Elon Musk must be held accountable for everything that they do. If they are not, they throw away the dollars of American families like it’s bathwater. The recent Falcon 9 failure should serve as a reminder that our faith should not be put so quickly in anything, let alone someone who promises to fix all of our problems – all for a small fee…

    Cloakroom Confidential

    Cloakroom Confidential was a longtime Capitol Hill staffer and insider who has contacts in the House and Senate at the highest levels.

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