SpaceX Rocket Failure Cost NASA $110 Million 204
An anonymous reader writes: On June 28th, a SpaceX Falcon 9 rocket exploded just over two minutes into its attempt to reach the International Space Station. It was a contracted mission from NASA to resupply the astronauts living there. Today, NASA associate administrator William Gerstenmaier said the price tag to taxpayers for that failed launch is $110 million. SpaceX is leading the investigation into the cause of the failure, and NASA officials faced tough questions about whether private companies should be allowed to direct investigations into their own failed launches. A similar inquiry is underway at Orbital ATK. NASA inspector general Paul Martin said his office is looking into the matter. Gerstenmaier added that NASA is thinking about making these companies take out insurance policies that would cover the cost to taxpayers in the event of another failure.
as always.... (Score:5, Insightful)
"Privatize the profits, socialize the risks."
That's how big business works in the USA.
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How many F35 test flights is $110 million?
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I wonder what the cost to taxpayers would be if NASA were doing their own development and had a similar explosion.
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Likely well north of half a billion.
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I'm not sure that is what is happening here. It seems reasonable that a rocket owner will refuse to take liability for the stuff on the rocket, since a rocket blowing up is not uncommon. So they basically say, "you can send stuff on our rocket at your own risk." Maybe the satellite owner should go out and buy insurance, but if it was up to the rocket owner to buy the insurance they would just pass that exact cost on to the payload owner (making the payload owner pay for the insurance indirectly).
So the qu
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Your insinuation that it doesn't work that way everywhere else (just with less transparency and less ability to say anything about the people doing it) is illuminating.
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NASA negotiated the terms. There was no reason they could not have included an insurance requirement as commercial customers do. NASA should have. I'm not sure why they didn't but this isn't a SpaceX problem, nor a problem with commercial launch. If NASA was using their own vehicle (assuming they had one), not only would it have cost more for the launch, but the tax payer would have still been on the hook.
These shameless attempts to discredit commercial launch providers and go back to status-quo, where
Re:as always.... (Score:5, Insightful)
Who do you think can make a better actuarial judgment of the risk, NASA or an insurance company? The government is certainly large enough to be self insured, which is in the long run cheaper than paying an insurance company which intends to make a profit to assume the risk.
And, forcing the private launch service companies to take out insurance adds even more cost, by adding another level of administration to pass the money through.
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"NASA is thinking about making these companies take out insurance policies"
Who do you think can make a better actuarial judgment of the risk, NASA or an insurance company? The government is certainly large enough to be self insured, which is in the long run cheaper than paying an insurance company which intends to make a profit to assume the risk.
And, forcing the private launch service companies to take out insurance adds even more cost, by adding another level of administration to pass the money through.
but that's the whole point!!! pushing money through the stratosphere, not just into it. money is often refered to as liquidity because you can practically burn it like rocket fuel when
eh, ideas stopped there
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Off topic but:
You do realize that the point of the moderation system is not to reward people with good posts and punish people who post badly, but to bring the most relevant, interesting, and insightful posts to the forefront. Basically to cut out the crap.
So by not modding up ACs who make good points, you are not helping the discussion at all. You are hindering it.
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STFU, anonymous cipher. You amount to nothing because you don't have a backbone.
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I browse at -1 and I mod by quality and relevance of comments. If you're moderating by username, AC or otherwise, you're effectively performing a continuous ad hominem.
I read and moderate at -1. Gold, like the truth, is where you find it. i.e. plenty of stupid and just plain wrong gets moderated up, likewise facts, insights, and interesting posts can be found at below 1. Sometimes the most insightful is moderated down as a troll or overrated, by those with a warped agenda (and more than one account).
I'm all in favour of removing the troll tag - let other readers provide context to indicate a troll (or stupid) posts. Tags and ratings aren't reliable - just useful for those
Re:as always.... (Score:4, Insightful)
My curiosity is who at NASA is responsible for the insurance not being bought. Does a private company hold NASA responsible for failed launches (when they were launching), or is it the private company's responsibility to buy launch insurance?
Re:as always.... (Score:5, Insightful)
I don't think NASA does insurance because it's a business decision and NASA isn't a business.
The DSCVR launch was delayed because the Air Force (which is run more like a business) insisted on taking out an insurance policy on the SpaceX launch. They were involved because they were paying for it, since DSCVR was sort of an odd collaboration between NOAA, NASA, and the USAF.
Spacecraft insurance is expensive since the insurance actuaries actually want comprehensive statistical data on each launch vehicle, and that's simply not available on new launch vehicles with less than ~21 (remember the threshold for statistical significance?) launches.
Re:as always.... (Score:5, Insightful)
How would insurance save money? Another middle man to pay. The only justification for insurance is when you need to smooth out the bumps in your spending - an individual may not have $30,000 sitting around to replace their crashed car. NASA can almost always slip a schedule; self insurance makes a lot of sense for them.
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The federal government frequently self-insures. If the federal government were a business and made rational business decisions, that would make financial sense, and that's how it's usual justified. In reality, though, probably it mainly self-insures because it makes the costs of various programs appear lower than it actually is.
In any case, SpaceX's record doesn't seem to be that bad. I think a reasonable insurance premium based on their record might be 10-20% of launch cost.
Re:as always.... (Score:4, Informative)
Just about every organization over $1 billion USD self-insures most risks, although this is not always apparent because they often use the processing division of full service insurance companies to analyze and process their transactions. True insurance policies from 3rd parties don't come free and beyond a certain size the universe of risk is the same for the organization as the insurance company.
sPh
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As I was saying: If the federal government were a business and made rational business decisions, that would make financial sense, and that's how it's usual justified
You seem to have missed the second part: the federal government isn't a business, NASA expenditures are subject to lobbying and crony capitalism, and hence third party insurance may be worth the cost, because a third party has a compelling interest to safeguard their own money. "Using the processing division" of an insurance company is not the s
Re:as always.... (Score:4, Insightful)
Insurance is not magic. As the entity selling the insurance is making a profit, obviously purchasing insurance is a money-losing proposition, so its only function should be to mitigate disaster. Losing $110M is not a disaster, and therefore *not* buying insurance is the more responsible use of the taxpayer money.
Re:as always.... (Score:5, Insightful)
Go tell that to the belching smokestacks, the carcinogen-laced groundwater, the deteriorating climate, the poisoned oceans. Tell it to the minimum wage workers who have to go on food stamps, the students with crushing loans and no job prospects, the retirees who've lost their savings to yet another bankster stock swindle. Tell it to the vanishing middle class, whose wages have been flat for forty years while productivity and the wealth of the 0.01% has soared.
If you mean by corrupting government to avoid regulation of evil behavior, then I agree with you completely.
I would be FASCINATED to hear your logic as to why government would seek to privatize (i.e. lose money) profits in order to socialize (i.e. lose money) the risks.
So you're saying the solution to this problem is to allow MORE of this kind of behavior.
My god, you are so utterly delusional, there are no words to describe it. You would have more intellectual integrity if you posted in rabid favor of aroma therapy and woodland elves.
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Simple: because politicians and government employees aren't selfless saints. Instead, they are corruptible, limited human beings primarily concerned with their own careers, reputation, and financial success. Among other things, they respond very well to lobbying.
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The "welfare" programs that were in place from 1934-1996 no long exist, but even taking the succeeding limited programs under as successors "welfare" has been cut continuously from 1981 through to this day, including during the Obama Administration. Not sure where this breitbart myth of the luxurious "welfare" benefit and the t-bone steaks comes from but it has no basis in factual reality where PRWORA was passed in 1996 representing the ultimate
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That's nonsense. Welfare spending has increased pretty steadily since the 1920's, from a fraction of 1% of GDP to 5% of GDP. You can also look at it on a per capita basis or in constant dollars, same result.
The Heritage foundation has a pretty good article on the failure of the war on poverty:
http://www.heritage.org/resear... [heritage.org]
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No, neither. The problem is that the regulations themselves are corrupt; that is what "regulatory capture" means.
No, the conversation is about who is responsible for "privatizing profits and socializing risks". It's a simpl
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No, the same argument doesn't work. Those programs were passed with the promise of actually improving things, not stemming a worse decline. And if you look at the data, the start of the decline coincides with the start of those programs. Public choice theory tells you why these programs don't work: they are subject to regulatory capture and rent seeking. Both economic theory and empirical data clearly tell you the same thing: these program
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Consider the financial system meltdown in 2008. From 1990-2007 the large financial entities took trillions of dollars of profit for themselves. Part of the deal of capitalism is that when you have profit opportunities that big you willingly accept the concomitant risk including the possibility that should the risk actualize you will
Blew up one of our instruments, too (Score:3, Interesting)
Painful, but we'll live. There hasn't been a rocket yet that has a perfect operational record.
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Painful, but we'll live. There hasn't been a rocket yet that has a perfect operational record.
Oh sure there is... We've just not tried to launch it yet.... ;)
Record [Re:Blew up one of our instruments, too] (Score:2)
Apollo 6 had two engines shut down early, but the upper stage burned longer to compensate, so the vehicle still made orbit.
The S-IVB didn't restart in orbit-- but since that was after it already made orbit, that counts as an in-space propulsion failure, not a launch vehicle failure.
Apollo 13 had a second-stage engine shut down early, but, again, the other engines burned longer to compensate, and the launch was a success. Launch wasn't the problem with Apollo 13.
So, I'd rate Saturn-V at 100% success rate as
Re:Blew up one of our instruments, too (Score:5, Informative)
Saturn I -- 10 launches from 1961 to 1965, 10 operational successes. And that was using clustered engines and liquid hydrogen engines in the EARLY 60s.
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And designed largely with pencils and slide rules.
A feat that I highly doubt today's politically correct NASA could repeat today.
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Saturn I -- 10 launches from 1961 to 1965, 10 operational successes. And that was using clustered engines and liquid hydrogen engines in the EARLY 60s.
Successful, but not totally a clean record... SA-1 and 3 had issues related to improper fuel loads. AS-101 had an unexpected engine failure and AS-103 sand SA-104 had some minor failures. They all achieved their mission objectives, but the vehicle wasn't flawless.
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Was the design spec "get payload to correct orbit safely" or was it "get payload to orbit with zero subsystem failures"? Maybe there was a reason the designers chose to use five smaller engines and an control system that could compensate for the loss of one or two.
sPh
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Was the design spec "get payload to correct orbit safely" or was it "get payload to orbit with zero subsystem failures"?
Yes.
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Statistics wise, with only 10 launches the system could really have up to a 10% failure rate and 0 failures in 10 would be a perfectly reasonable result.
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Yea, it apparently had a similar failure rate to the Saturn V. Operationally it lost one engine in flight, had fueling issues for two flights and a whole host of minor issues and glitches both on the launch pad and in flight. Where it was successful at meeting it's objectives for each mission, it did not have a perfect record.
pogoing engines (Score:2)
didn't do enough of them. there were design issues that would have surfaced . wikipedia on a friday night when you're bored
The SpaceX advantage? (Score:3, Interesting)
SpaceX policy seems to be to collect rich telemetry from each launch, so that fault investigation can proceed from the data, rather than the old approach of fishing for wreckage and piecing it together to determine the cause. Does NASA do things this way too now, or is it still using the old style of forensics?
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NASA pays them to launch the rocket without taking into account the cost of a failure investigation, their process for how to proceed will be based on what data they have available, if rich telemetry is available they will use it, but in practice most don't have it because NASA wont pay for it. SpaceX spends extra to get that extra data, so they have it.
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SpaceX policy seems to be to collect rich telemetry from each launch
And you think ULA, Orbital and Boeing don't?
And, by the way, if you find any debris washed up on the beach (any beach) they want it - call the SpaceX debris recovery hotline, 866-392-0035.
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Also, they immediately sent all the surface assets they had in the area to search for debris. I don't know where the GP got the notion that they aren't interested.
Insurance? (Score:4, Insightful)
If I ship something, it is up to me to pay insurance if I wish to do so. Otherwise, I take my chances on something happening to the cargo or it getting completely lost.
Why should the rocket manufacturer pay the insurance. That should be NASA's/the taxpayer's responsibility just like any other package delivery system. Let the insurance companies figure out a premium based on the success/failure rate of each rocket launching company and price accordingly.
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Insurance companies don't lose money in the long run. If NASA insists on SpaceX taking out an insurance policy, that cost will be passed right onto customers (oh wait, NASA being the main one). This is a new and evolving industry, so say the insurance companies determine 1 in 10 launches will fail. So the insurance will cost $25M for every $100M in coverage, add 10% for SpaceX administration, $27.5M. Every $275M of taxpayers money, the insurance industry will pay out $100M. And every time they pay out, the
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Utterly true. However, your shipper is not trying to develop safer delivery trucks or airplanes so as to reduce the frequency of accidents. Those are other entities (GMC, Boeing, etc.). Your shipping may be trying to reduce driver/pilot negligence or otherwise abate other people's negligence, but those are strategies that are either well-k
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UPS and FedEx don't manufacture their trucks, but they're heavily involved in the development of the vehicles they use (other than perhaps the tractor-trailers). They have engineers that work directly with manufacturers on the layouts, materials, aerodynamics, and powerplants to find a mix of cost, fuel efficiency, security, and even safety.
SpaceX is trying to break into a business with a completely new cost model, and a relatively new rocket model (mix of some proven technologies with some new ones and ev
Re:Insurance? (Score:4, Informative)
Wait what? In many industries bonding is a prerequisite for simply submitting a bid and being bondable a prerequisite for being employed. Hell try getting a mortgage without insurance. This is so dumb I had to login to comment for the first time in years.
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Re:Insurance? (Score:5, Insightful)
I came here to say exactly this... if SpaceX has to buy a policy, you don't think they're going to pass that cost through to NASA anyways? Pft!
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But making SpaceX get insurance means you're "doing something". (eg, Creating more paperwork, and adding the inefficiency of the insurance industry getting its fingers in the pie. Insurers also make a profit.) Ultimately this hurts the
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Without buying extra insurance, you're limited to what the carrier is willing to pay out as specified in the contract agreed to at the time of purchase. In the US, both UPS and FedEx cap their payout at $100 unless additional insurance is purchased.
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Without buying extra insurance, you're limited to what the carrier is willing to pay out as specified in the contract agreed to at the time of purchase. In the US, both UPS and FedEx cap their payout at $100 unless additional insurance is purchased.
I'm sure that every launch has its own contract that probably takes as much time to hammer out as preparing the rocket for launch does. I'm sure NASA could get SpaceX to insure delivery for X or just make a good faith effort of delivery for X-Y.
SpaceX too good to be true? (Score:2, Interesting)
Re:SpaceX too good to be true? (Score:5, Informative)
Well, maybe more expensive Russian rockets cost what they do for a reason?
Well, that reason is certainly not reliability-- Russian rockets have been pretty failure prone lately.
http://spacenews.com/proton-fa... [spacenews.com]
http://spacenews.com/progress-... [spacenews.com]
http://spacenews.com/russian-s... [spacenews.com]
Atlas-V and Delta-IV been doing pretty good, though: so far both have had a 100% record for reaching orbit, although each one has had one launch with an underperforming upper stage that put it into lower-than-planned orbits.
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We should have hired them to build the F-35 (Score:2)
We should have hired SpaceX to build the Joint Strike Fighter. $110M for one capsule is nothing!
Better than the shuttle (Score:5, Interesting)
No Insurance?? (Score:2, Interesting)
Seeing how space travel isn't exactly safe and virtually all launch systems have at some point blown up, why wouldn't this be insured? You would think NASA or SpaceX would have some sort of insurance to cover for damages. Most of us have car insurance for example because statistically at some point virtually everyone has one car accident in their lifespan. As much as I find SpaceX a nifty company and a good idea. (It's so far had a pretty good track record for cost of launches) making it the most cost ef
Re:No Insurance?? (Score:5, Insightful)
All insurance schemes are designed to amortize the risk... in this case, amortize the cost of a failure over the previous, and subsequent successes... and the middleman skims a little off the top. So I look at this and think buying insurance is actually just a waste of money.
To anyone who would disagree: If the only insurance you've ever bought is for your car... you probably don't know shit about insurance.
Re:No Insurance?? (Score:5, Insightful)
Correct me if I'm wrong, but you seem to think that somehow insurance will lower the cost of the accidents. But it's perfectly obvious that, in the long term, that can't possibly be true. The insurance company has to make a profit - PLUS its own overhead costs. - plus of course covering the payouts.
The reason an individual (unless very wealthy) doesn't self-insure is because the things he is insuring against are very low-runner risks, but if/when they do occur, he would be instantly bankrupt. That's not the case for the US government. $110 million is pin money. Petty cash. Pocket change. Rounding error. They can save money by self insuring.
Now, if they didn't build in a cushion to the program to cover such boo-boos, that is entirely a different thing. Then they would be stupid. That doesn't change the equation that in the long run it is always cheaper to self insure.
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I'm not convinced that it's cheaper for the government to pay for failures rather than buy insurance. The reason is that I believe it is easier to convince a government worker that the risks are lower than they really are, than an insurance company. So the government might make better informed decisions if an insurance company made their independent risk estimates.
doesn't matter what you call it (Score:5, Insightful)
I think this is a good idea, but not for the reason Gerstenmaier says. What it will do is get another private entity to look at the risks of these launches and price them accurately. This will make it clearer in the budget how costly these launches actually are.
However, the cost for insurance will simply be added on top of the contract, so the tax payer pays for it either way. In fact, with insurance, the tax payer will pay more on average than without insurance.
Self-insure (Score:2)
"However, the cost for insurance will simply be added on top of the contract, so the tax payer pays for it either way. In fact, with insurance, the tax payer will pay more on average than without insurance."
Exactly, and this is a good reason to NOT pay a third party for insurance.
Insurance exists for infrequent casualty events that you do not have the balance sheet or liquidity to manage on your own, so you contract out for someone to provide you that balance sheet / liquidity, at a cost to you. For Pro
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The government can "demand" whatever it wants. But if this were a free market transaction, SpaceX would, in fact, be raising its prices by roughly the same amount as an insurer would.
In a free market, "negotiating power" has no influence on costs. Any rational business is simply going to want to make roughly a market retur
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Insurance is important in most trades
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Yes, that's pretty much what I meant by "this will make it clearer in the budget how costly these launches actually are."
Part of the problem is that NASA is probably not very good at estimating the risks of suppliers, and it isn't motivated to do so anyway because understating the risk and self-insuring is a good way of getting funding for programs that wouldn't pass if the budget had to include risk.
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In the case of the government and space launches, the government can afford to pay for failures. So it makes no sense to in
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Well, good that you understand at least the basics of insurance. As I was saying, though, the point of insurance here is not that the government can't absorb the risk, it is to get accurate pricing:
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Insurance always works that way; that's pretty much the definition of insurance: you pay someone a premium to reduce your risk.
Also for the Pad. (Score:5, Informative)
The Orbital failure took out the pad, which was owned by the Commonwealth of Virginia, which had neither insurance nor reserve cash to pay for a new one. That caused a scramble [spacenews.com] to find the bucks [usainspace.com] to repair the pad.
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fryPad?
Insurance (Score:4, Informative)
Practically every commercial satellite launch is insured. Typically runs $20-30 million for a $250-350 million satellite.
Lockhead PR is all over this (Score:2)
Honestly, it blows my mind that NASA didn't buy insurance in the first pl
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Insurance reduces immediate risk by spreading out the costs, for the price of a bit of overhead.
But it's hard to spread out the cost of space launches. There aren't that many. And if you have enough money in the bank to pay for the crash, you shouldn't get insurance. In total you would be paying more for insurance (via overhead) than if you were uninsured.
He may be mistaken (Score:3, Informative)
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You're forgetting the pork attached to the thing. How much does freeze-dried food cost? How much does it cost when NASA buys it? A freeze dried yoghurt will require cows from Wisconsin to supply the milk to a yoghurt factory in Vermont after which it is shipped to a freeze drying place in Alabama and then it is shipped to a packing place in Texas before finally getting to the launch site in California, all transported by a New York transportation company.
I've worked with government contractors, they typical
Do you understand what Insurance actually is? (Score:4, Interesting)
How many rocket launch policy holders are there to spread the risk among?
I suppose an insurance underwriter could spread the rocket launch risk (and cost) among their auto and home policy holders. That will make them uncompetitive in the auto and home insurance market. So they'll have to keep the risk amongst similar policy holders for rocket launches.
Ultimately, just like houses burning down, some rocket launches WILL fail.
If NASA is forced (maybe by ignorant Congress who must "do something!") to buy insurance, then the cost of failure is still passed to the policy holders (eg, mostly taxpayers). Plus now you've got another industry (insurance) getting their fingers in the pie and making a profit. If Congress or NASA forces SpaceX to get insurance, then SpaceX will pass the cost of insurance on to NASA and ultimately taxpayers in the form of higher launch prices.
No matter how you slice it, the customers of rocket launches WILL bear the costs of inevitable failure. There's not that many customers to spread the costs amongst like there are for homeowners.
$110 Million!? Dammit! (Score:5, Funny)
Well, 3/4 of one anyway...
.
Well there goes half the budget... (Score:2)
Didn't congress give them but $230 Million for this kid of thing just recently?
Dang, this is half the year's budget. It's going to hurt the commercial crew budget. I guess this just validates the position of congress then that Space X just isn't ready enough to get their stuff human rated and they apparently need some more time to work out the kinks... Shame they blew up almost a half of the budget though...
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Doesn't SpaceX so far have a much better track record of not blowing stuff up than NASA? Certainly better than the russians.
If you find a magic solution that doesn't fail sometimes (used to be SpaceX) then I'm sure NASA is interested. ;)
Of coure private companies should be allowed to... (Score:2)
Of coure private companies should be allowed to investigate their failures. They just shouldn't have an exclusive right to do so. They pay for their investigation, the government pays for it's investigation, any other involved parties pay for their investigation. The data isn't kept secret. (Not being secret doesn't mean that what it means will be obvious, hence the plausibility of multiple investigations.)
BS (Score:2)
When did NASA pay for any of its failed launches? When did the big boys it usually contracts with pay? When did the Russians pay for their failures? This is bullshit.
taxpayers or ... taxpayers! (Score:3)
So the risk instead would be spread out into a higher launch fee (taxpayers) and higher insurance fees for everyone (taxpayers).
The insurance would make the cost of the launch a lot higher, and NASA (taxpayers) would have to pay that.
Money doesn't grow in insurance companies either - they are re-insured and the cost is spread out to everyone.
But I guess it would look better for NASA?
(That said, I thought insurance was involved already. At least for individual projects blowing up?)
Re:yes thats it, pander to another industry (Score:4, Insightful)
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Did NASA ever truly launch rockets without private companies? Saturn was a partnership with Boeing, and the shuttle was Boeing/Lockheed and some others. So what is the difference now?
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Mod parent up.
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maybe if nasa didnt stop its rocket development [...]
I assume you've never heard of the Space Launch System [wikipedia.org] being developed by NASA.
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NASA is _terrible_ at designing rockets.
They do it at great expense and time.
http://www.nasa.gov/pdf/586023... [nasa.gov]
Page 9 - Spacex tool ~440M to develop falcon 9. A more typical NASA approach might take 1.4 billion.
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What contract did they decide on instead? "Here's a bunch of money, no worries if the rocket fails"?
When I toured Kennedy in the 80's, they said the Shuttle launches were insured by Lloyd's of London for $2B.
If there's no insurance on the SpaceX launch it's not because they never thought of it before. They may be self-insuring (getting lower launch costs by not requiring insurance - maybe the launch is $150M insured). They may be be incompetent. They may be lying in spirit if not technically to try to be
Re:They don't already? (Score:5, Interesting)
They may be self-insuring (getting lower launch costs by not requiring insurance - maybe the launch is $150M insured).
This was my thought. Rocket launches are risky, so any insurance is going to be expensive.
So let's say they require commercial insurance to be bought, and the insurance company correctly predicts a 5% failure rate. But they have expenses to cover, the insurance is 'unusual' and highly variable, it's a small market, etc....
Just to break even, they would have to charge 1/20th the cost per launch, but that's not the end of it. They have expenses and profit to worry about. For something like rocket launches? 20% overhead wouldn't be out of line, I think.
So rather than the 'insurance' cost per launch being 5%, it's now 6%. For a $100M launch, that means self covering costs, on average, $5M. Commercial insurance would increase that to $6M.
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The government is always self-insured. I believe that the private launch companies have to have some basic insurance to get a launch license. Commercial satellites are routinely [casact.org] insured, but that is a business move, not a requirement.
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Are these things not insured anyways?
Well, when the insurance company says "Sure we will write insurance for that $110 million, just cut us a check for $110 Million.." you just don't do it. Besides, it's usually less expensive to "self insure" (i.e. take the risk yourself), especially if you know you will succeed.
I'm not sure if they could buy insurance for the vehicle, given their previous track record. I wouldn't bet they will succeed on the next launch myself and if nobody wants to write insurance at a reasonable rate, you just take the
Re:wait, who's paying for this cock-up? (Score:4, Informative)
No they are not.
Re:Insurance? (Score:5, Insightful)
By making either NASA or SpaceX get insurance, you add in another greedy industry (insurance) that get their fingers in the pie and make a profit. Great way to save the taxpayer money.
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Check on the June 15, 2007 launch. Where the flight wasn't a total failure, the vehicle failed to reach the intended orbit due to a valve failure.
So not perfect reliability for even the Atlas V, which has one of the absolute best and longest records flying in rocket science.
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Also, isn't each launch with SpaceX a _lot_ cheaper than any Atlas V launch?
I haven't googled the figures, but a guess is that you can blow up 20% of the SpaceX launches and still be cheaper than if you did all the launches with Atlas V.