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Cost plus contracts are a huge problem for efficient public funding of projects. Also see NASA'a SLS rocket versus SpaceX's falcon heavy. SpaceX's next generati

Cost plus contracts are a huge problem for efficient public funding of projects. Also see NASA'a SLS rocket versus SpaceX's falcon heavy. SpaceX's next generation rocket is going to be so far ahead of the SLS in capabilities and cost it is ridiculous to continue the NASA program. I would not be surprised if the SLS program will even survive the first launch of the BFR. Hopefully they will be able to cancel it at that point and use the funds for funding sending people to mars using SpaceX tech.

CydeWeys 8y ago
SLS is a great example because, incredibly, the contractors get paid no matter what. They don't have to achieve goals, meet timelines, or come in on budget. They simply do things and get paid for them. Contrast with SpaceX, which has to have successful launches in order to survive. They are incentivized to succeed, and so they do. The SLS program has little incentive to succeed, so instead it turns into a game of extracting as much money as possible (which is inimical to succeeding quickly!!!).
- njarboe 8y ago
  " They are incentivized to succeed, and so they do." Well, they have succeeded so far due to a huge amount of capital and talented people working very hard. I think more importantly is, if a system fails, that it shrinks in power and eventually disappears instead of getting bigger and stronger. A well working free market seems the best way humans have devised to do that so far.
  - hoaw 8y ago
    That is a selective view of the free market. For any company under pressure to succeed there are others whose expertise is extracting, rather than producing, value. Failed projects, both private and public, are often run by such companies that are successful in what they do, just not in what they deliver. I think if there is any comprehensive reason why companies like SpaceX, Tesla or e.g. Amazon are successful is because they are vertically integrated. The limited the amount of activity, and responsibility, not under their own control. These days the government is often prevented from doing this, and large companies often want to cut cost in the short term. These companies have understood that their is less of an information gap these days, so there is little reason to let others take care of you core activities.

CydeWeys 8y ago

SLS is a great example because, incredibly, the contractors get paid no matter what. They don't have to achieve goals, meet timelines, or come in on budget. They simply do things and get paid for them. Contrast with SpaceX, which has to have successful launches in order to survive. They are incentivized to succeed, and so they do. The SLS program has little incentive to succeed, so instead it turns into a game of extracting as much money as possible (which is inimical to succeeding quickly!!!).

njarboe 8y ago
" They are incentivized to succeed, and so they do." Well, they have succeeded so far due to a huge amount of capital and talented people working very hard. I think more importantly is, if a system fails, that it shrinks in power and eventually disappears instead of getting bigger and stronger. A well working free market seems the best way humans have devised to do that so far.
- hoaw 8y ago
  That is a selective view of the free market. For any company under pressure to succeed there are others whose expertise is extracting, rather than producing, value. Failed projects, both private and public, are often run by such companies that are successful in what they do, just not in what they deliver. I think if there is any comprehensive reason why companies like SpaceX, Tesla or e.g. Amazon are successful is because they are vertically integrated. The limited the amount of activity, and responsibility, not under their own control. These days the government is often prevented from doing this, and large companies often want to cut cost in the short term. These companies have understood that their is less of an information gap these days, so there is little reason to let others take care of you core activities.