McCain: Rocket Deal ‘Smacks of Cronyism’

McCain: Rocket Deal ‘Smacks of Cronyism’

A leading Republican senator criticized the U.S. Air Force’s multi-year contract for rocket launches from a Lockheed Martin Corp.-Boeing Co. joint venture, saying it smacks of cronyism.

Sen. John McCain, R-Ariz., questioned the service’s recent multi-billion-dollar, sole-source contract with United Launch Alliance LLC for 36 medium– and heavy-lift launches of military satellites through fiscal 2017, saying it prevents potential new competitors such as Space Explorations Technologies Corp. from bidding for some of the work.

“This smacks of the cronyism that we saw in the first tanker contract that ended up in a major scandal,” McCain told the Defense Department’s top weapons buyer, Frank Kendall, on Wednesday during a hearing of the Senate Armed Services Committee.


He was referring to the Air Force’s initial deal with Chicago-based Boeing for a fleet of new refueling aircraft. The agreement was canceled in 2004 amid a scandal involving Boeing’s chief financial officer, Michael Sears, who offered a job to the Air Force’s top procurement official, Darleen Druyun, during negotiations. Both were sentenced to serve jail time.

McCain added, “And I’m not saying that it is, but it doesn’t make any fiscal sense — the decisions that you have just made by cutting down on competitive launches.” The senator has already asked the Pentagon’s inspector general to investigate the terms of the agreement.

Kendall defended the so-called block buy contract as helping to lock in prices and curb rising costs in the program, known officially as Evolved Expendable Launch Vehicle, or EELV. He described it as the result of “very successful” negotiations with the contractor. “That contract is at a much better price than we had anticipated in our previous budgeting,” he said. “We saved on the order of $3 billion.”

The Air Force plans to buy three EELV launches in fiscal 2015, which begins Oct. 1, for a $1.38 billion, or about $460 million per liftoff, according to budget documents. SpaceX argues it could provide the same service for a quarter of the price.

Since its inception in the mid-1990s, the launch program is estimated to cost a total of $70 billion through fiscal 2030. The cost surged almost 80 percent in the past year alone — accounting for the vast majority of the Pentagon’s overall rise in weapons acquisition costs, according to a March report from the Government Accountability Office, the investigative arm of Congress. The costlier price tag was mostly due to an increase in expected launches.

SpaceX, headed by billionaire Elon Musk, last week sued the Air Force to challenge the block buy agreement and open more launches to competition. The company says the deal effectively boxes it out of military business, especially because the agreement includes medium-sized GPS satellites that could fit inside its Falcon 9 rockets. The company is seeking but hasn’t yet received certification to carry national-security payloads.

SpaceX has also sought to capitalize on the rising political tensions between the U.S. and Russia by pointing out that one of ULA’s boosters, the Atlas V, uses the RD-180 engine made by the Russian company NPO Energomash — and that Dmitry Rogozin, the head of Russia’s space sector, was recently sanctioned by the White House following Russia’s invasion of Ukraine’s Crimean peninsula.

McCain made a similar argument. “The motor made by the consortium is made in Russia, right?” he said. “That alone — that Vladimir Putin is responsible for our rocket motors — should be reason why we should be looking desperately for competition rather than narrowing it.”

Kendall said he put the acquisition program under his control to ensure competitive launches. He also said he has worked to expedite the certification process for new entrants such as SpaceX. “Competition is the single best tool that we have in the department to get costs out of our programs,” he said.

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Don’t agree with J McCain on many issues, but on this one, he’s dead right!

Agree, McCain is correct.

One might realize that in order to maintain our technological lead in certain military areas keeping companies like Lockheed and Boeing onboard is a necessary evil. At the same time bringing a diversity to the suppliers ought to be a goal as well and as such getting a percentage of these type of contracts awarded to subordinate players to build their abilities vital to our Nation as well. As an example one might look to Ball Aerospace’s history and see how they grew over time to become a supplier of note. Mr. Musk is right in that the government ought to allow his company an opportunity to launch a GPS satellite. Getting his work force cleared and ready takes time and needs to be an effort undertaken now..

Jeez McCain, you think? Every freaking contract Lockheeds in on.

Gee, McCain is talking like this doesn’t happen on a daily basis. He should also look into the latest fiasco
at Lackland whereby the basic trainees have to buy a certain type of gym shoe. Why, because it’s American
made! That’s great, but the important point is that the basic trainees worked for that money,and it is theirs.
Nobody, repeat, nobody should be able to tell basic trainees how to spend their hard earned money.
Another case of the Lackland Command Chief sitting on his/her butt and not looking out for the interest
of these airmen with no stripes and can’t complain. Chief A (30 year vet)i

44 years ago I had to pay for my own hair cut in basic and buy my
foot locker items, soap dish, tooth brush and holder and a shaving brush, etc. hell no one used a shaving brush then but we still hade to buy it.

52 years ago I was issued a ditty bag with soap, gillete razor, blades, shaving cream, tooth brush and soap dish + seabag w/ underwear, socks, all uniforms, boondockers, dress shoes, tennis shoes, scrub brush, ropes for hanging laundry, towels and all the items I needed for basic. They left nothing out including the free hair cut. So all of you got short changed. McCain is right on with this and I hope they open the can of worms about purchasing things from countries other than the USA that is against the law. All this saber rattling will make it difficult to get the man out of space, stop the houses from freezing in EU, provide gas for the electric plants that get fuel from Russia, and changing diapers for VPOTUS & POTUS when they crap their pants.

Until we get out of the sole source mindset that exists in Space contracting , we will never get innovative solutions. McCain is right. I work in DoD acquisition and it’s frustrating how far ahead commercial sector is on a variety of tech fields, yet we have to live with these kinds of blind decisions.

Not true.… Many firms with solid reputation and better technology have gone by the wayside. And the purchse of the remaining shell often does not tranfer the technology well. The current launch alliance was an attempt to reduce competition and maintain a high cost structure which is did well. Much of the technology held by ULS was developed nad paid fir by the taxpayer and as tayper property should be open to all us qualified firms.

The need for reduced cost and innovation is clear when one looks at the cost of this lauvh program when compared the what Space X and others are offering. As for technology development in a short ten years Space x has successfulydeveloped three new engies. ULA?! none..not one. Pratt has but thej2x has been stalled .

There are many more examples of inovation and successes opening this field back to competition would bring the best technology forward. It always does. Oh and before the appolo and gemini programs..North American, Boreing! Lockheeed and the firms that built them.…Rocketdyne areojet garret and many others did not make rockets did not put large items in orbit.…the goals and funding and competitive bidding did. It one nce said by an astronaut as he was sitting in a Mercury capsule after being asked what were his toughts before launch..the reply that evry part n his rocket was supplied by the lowest bidder.…

As it should be.…..

That’s funny. One of the biggest cronies in the government complaining about that. What a tool.

While we continue to lose the “war on poverty,” “the war on drugs,” and every other war we’ve been in for the last 50 years, Russia has other plans.

It isn’t just the red planet [Mars] that Russia is planning to conquer. Earlier this month, deputy premier Dmitry Rogozin said: ‘We are coming to the moon forever.’ In an article in the government’s own newspaper headlined ‘Russian Space’, he spoke of targeting Mars and other ‘space objects’ as future priorities. ‘Flights to Mars and asteroids in our view do not contradict exploration of the moon, but in many senses imply this process.’ — http://​www​.dailymail​.co​.uk/​s​c​i​e​n​c​e​t​e​c​h​/​a​r​t​i​c​l​e​-26

You’re a tool for calling John McCain a tool.

F Lockheed and Boeing. All they have done for us is put our space program in the f’ing toilet. Back before we had these f’ing defense contractors designing our rockets we could go to the Moon. Now we have to pay the damn Russians for a ride on their ex-Soviet Union designed rocket just to get a damned astronaut’s ass out of his chair at his desk. We need Lockheed and Boeing like we need another hole in the head. Those bastards have not done a damn thing “FOR” the US. All they have done is take, in huge amounts.

I agree also but have to wonder if Space Explorations Technologies Corp isn’t McCain’s ‘crony’.…..

What happened to out Titan IV heavy launch vehicles?

It’s amazing how people can be so sure of what they think they know though they don’t understand the situation at all. Space-X has not proven themselves in a very risky, expensive business. ULA has not faltered. Lockheed is not directly involved. This was a planned deal and a normal course of business on a program that has been curbing costs to become as efficient as possible. The joint venture between Lockheed and Boeing itself was one big step towards that end.
Bottom line, McCain is pretty loose with his tongue in his shoot and draw approach. He should be getting the facts and then coming to the right conclusion. He is irresponsible.

Nice try, ULA.

McCain screaming about anything being unfair that isn’t lining his own pocket??? I do agree, Spacex is right to protest this contract award. They have already proven their launch vehicles are viable.

‘fixer: SpaceX’s founder Elon Musk was the beneficiary of huge gov’t loans 4 his Tesla Motor car div., so he has fed of the gov’t tete’..either way.….…

Well SEN5241, its not over yet, Space X has sued & has be granted a “blocking order” from a Federal Court Judge”, so jeez sakes how long this will take to work out!

u mean Delta IV’s, we still got ‘em…I don’t know why anybody is running around like their hairs on fire, I think we have 35–40 of ‘em in stock.….

Need to check on this claim, because if we have so many in stock, it means the Air Force doesn’t know how to budget properly (on an as-needed, lead-time basis). Just like all the excess “spare parts” we’ve bought, the Air Force is squandering money on the wrong things. Which is why we can’t afford our best aircraft the A-10.

BTW, we should GIVE to the Ukraine so they can kill any Russian armored vehicles and tanks coming their way soon. Give them the ammunition and antitank missiles, as have some of our pilots sign up with the Ukrainian Air Force just like our guys did in WW2 with the Candians and RAF, and John Paul Jones did to help form up and train the Russian Navy.

Where is someone like IKE who knocked heads together and said quit screwing around and get the job done after Sputnik was launched. Guess what——-NASA was established and Neil Armstrong walked on the moon. We need leadership like that instead of the infighting, cronyism and lack of leadership that exists today.

After Lockheed and Martin Marietta merged (or whatever) they cancelled the Titan IV with it’s Aerojet engines and CSD solid boosters in favor of the Atlas V, which uses the Soviet designed RD-180 engines.

BS. Lockheed is directly involved, and SpaceX has proven themselves at least as well as the Borg has.

You might want to note that Tesla paid off the $465M loan last year — 10 years early!

They get an $80 shoe allowance. It was a way to get around having to “buy American”. Good to see our military can be so creative when it comes to screwing the people who pay their salary.

Just out of curiosity, what about SpaceX do you consider “not proven” at this point? The Falcon 9 Heavy hasn’t flown yet, but the Falcon 9, 1 & 1e have proven themselves reliable so far. How many flights do you consider for “reliable”?

54 years ago I was issued the same thing.…it came out of our first paydays.….something few noticed while in boot camp.

Would be nice if Aerojet or some other American company is allowed to start putting their engines back into the USA heavy launch vehicles so American can have the jobs and security of using our own equipment. Those launch vehicles are still in the inventory albeit in California. There is the possibility some were destroyed at Sierra army depot but I’m not sure.

That is what we hired him for. I would like to see you up against what he is at least he would DRAW & THEN SHOOT otherwise a person will shoot themselves in the foot, like you. Any space launch is dangerous no matter who does it, it’s a controlled explosion of very explosive products. Solid fuels with recoverable solid boosters do cost more but in the long run will save money. Regardless of where or who launches it is still and always will be a crap shoot. The USA is going to suffer from the decision to save a few dollars and go with another nation for items involving the military or NASA. Didn’t someone just toast a satellite recently? One thing for sure is that this is going to be brought out into the open.

ULA has had several failures to put satellites in the correct orbit, SpaceX has had 100% mission success by EELV rules on all 8 of the Falcon 9 launches. SpaceX is not asking to fly the high security missions — yet. They would be happy to fly the low cost (with extra spares) GTS satellites until they are fully proven on high priority missions. ULA can save their remaining rockets for those high risk missions until SpaceX has demonstrated they are ready. Remember 50% of failures are rocket engines and both stages of Falcon 9 use the same engines, 10 Merlins every flight. They already have more flight history than the RD-180.

Well said, Rocketeer!

SpaceX is California-based so that seems like a long-shot.

spot on AFR O5, so you know who he’s beholden too!

don’t waste your time taxpayer, their used for sat. launches, usually at night. TS clearance no doubt. The one in Nov. 2013 had a 28 tn payload.…what weighs 28 tn’s that goes into space???? u tell me. Why how a stock of 35–40, maybe a space plane, a hyper-sonic test vehicle, who knows/

p.s., if that loan wasn’t paid off from the sale of tesla stock, the company would have defaulted, so I’m not sure what your point is, the end result:.….$78K hybrid cars, really nice, sat in one , the whole deal, plus back-orders, but hardly a long term viable business model & Musk’s trek into the rocket business is fraught w/risk, he’s going in against “The Big Boys”. I wish him luck…but his volatility index for his stock.……well it speaks for itself.…

But all it will take is open conflict with Russia for those Russian engines to be shut down, an then where are we. Always have a back up plan.

Do you know how they set the height of the bridges on the first freeways? By the size of the tail fin on the Atlas rocket engine. But someone goofed at one bridge, and they had to let some air out of the tires to get it under, and then re-inflate.

I like the shoe policy. They don’t need Air Jordan’s, or LaBron’s.

49 years ago in the Marines, I did not have to buy a shaving brush. I guess that they figured that us Marines would dry shave all of the time anyway.

Ike started our freeway system because he led a transport cross country, back in 1929, and it took him 29 days to do it. He saw how important Germany’s Autobahn was, and knew that we needed a national freeway system. And the height of the bridges in those days, was set by the height of the Atlas tail fin, so it could get under the bridges.

Cleverly, SpaceX argues that sourcing Russian engines runs afoul of post-Ukraine sanctions.

Wonder what ULA will say. “Screw sanctions on Russia so we can get the cheapest engines while accepting increasing costs as routine”.
http://​www​.washingtonpost​.com/​b​l​o​g​s​/​t​h​e​-​s​w​i​t​c​h​/wp

So…either license build Russian engines in America (while pretending that breaking out old plans to build F-1 rocket engines is much more expensive) or throw in towel?

This is cool: https://​www​.youtube​.com/​w​a​t​c​h​?​v​=​9​Z​D​k​I​t​O​-​0a4
I hope the plan is to parachute the booster down until it gets close to the ground and then relight the engine and land it vertically.

The paradox is that DoD wants acquisitions to move faster while also wanting to evaluate technologies and encourage competition. Leadership cannot put a finger on what “faster” means since they don’t know how to generate a requirement in the first place.

stupid is as air force does.……

NRO payloads.

I suppose if they took their oath to defend the constitution seriously they’d disband. That’s the problem with playing fast and loose with the US constitution, you establish a whole bunch of new government bureaucracies that have no limitations and no charter. The same is true of the IRS and NASA.

I’m sorry but I have lost all respect for my senator McCain with his stance on immigration. I take what ever he spurts out with a grain of salt

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