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Senate Preparing $10B Bailout Fund for Jeff Bezos Space Firm

49 points by sharkweek 5y ago

dylan604 5y ago
The first rule of gov't spending is build two at twice the cost
- aaron695 5y ago
  I never got that quote (Contact) Take the premise governments are incompetent and overspend. You neither win or lose by getting two. The incompetence is built into the second same price. Except you have the second early. Building early has a cost, but given the way governments work the incentive for re-election is being under budget and fixing problems only when they become so bad they have too. Building early intuitively sounds better to me.
  - dylan604 5y ago
    >Take the premise governments are incompetent and overspend. Is that hard to understand? It's definitely pork. Some gov't official from a particular state drafts legislation to ensure that a company in the same state gets the money that legislation sets aside regardless if they are the best choice. That has to raise flags to everyone, right? Most gov't contractors know that they can charge multiples of what it would actually cost because it's the govt paying for it. No govt contract has ever said, "hey, we know we initially bid to do task for $x, but we actually were able to do it for $x-20%". Instead it is always, "oops, we grossly misjudged the scope of work and allowed people to continue to make changes to the request, so we're now 5x the original bid". They allow the requests to make these changes because they know that it is guarantee to keep the money flowing and people employeed.
    - aaron695 5y ago
      Yes, but why is getting the second for the same price as the first bad? For major infrastructure I would expect the second to cost around the same price as the first. Materials, labour, time, bribes and corruption is all double. Any saving you might expect around paperwork and opportunity cost I don't mind, compared to waiting a decade then starting the process of getting it through government again. Even in the movie, (I don't know the book) think about the downtime if they had to fund the project again. And if you include 'in secret' it's even worse, because if the 3 letter agencies can do anything in secret for the same price as a public department that would me pretty amazing. Maybe the quote isn't cynical - https://www.youtube.com/watch?v=VTUrdizRZyw https://www.youtube.com/watch?v=VTUrdizRZyw
      - zwily 5y ago
        I never took that line as “haha, the government was dumb not to get a volume discount”, but more as “haha, only the government would be dumb enough to build two of these ridiculous things”, but really it ended up kinda pro-government cause having the second worked out in the end.
AtlasBarfed 5y ago
Yeah it looks bad that the richest man in the world's pet backyard rocket company is getting pork, but space is still the purvey of government funding. Even if Blue Origin is behind SpaceX, it's still good to have a couple irons in the fire pushing things. Solar was the same way. There were probably a half dozen failed solar startups that Obama threw money at that the right can pillory as boondoggles, but this is how private research will go if governments aren't doing massive amounts of public research. Some companies will succeed, others won't.
- avmich 5y ago
  > Even if Blue Origin is behind SpaceX, it's still good to have a couple irons in the fire pushing things. It is a sort of whataboutism - in this case, just because Blue Origin is a space company funded by a rich person, the actions should be the same. Yes, Blue Origin is similar to SpaceX. There are, however, both qualitative and quantitative differences, and both of those may justify different results when viewed by a third party. Does Blue Origin produces good results? Well. Blue Origin was created before SpaceX, but many would say the results of Blue Origin are more modest. So NASA may decide that funding Blue Origin doesn't justify added expenses. Does Blue Origin need money? It could be funny, but Jeff Bezos can well fund the company - he even promised giving them a billion a year. That kind of funding is significantly different from, for example, NASA's help to SpaceX right after forth Falcon-1 flight. So NASA's money may not go as long in the case of Blue Origin. There are more modest companies where NASA help would likely achieve more. I'd name Sierra Nevada Company with Dream Chaser and Master Space Systems with their landers. Big aggregations of airspace behemoths, themselves created by merging multiple airspace companies and eliminating competition don't often produce results with reasonable price tags.
  - AtlasBarfed 5y ago
    You're not wrong, but to me it's still positive funding. It's not perfect, but it is far from the worst stimulus / funding the government does. And it probably wouldn't have happened without the lobbying, so it's not like this is taking money from other projects, at least in terms of government accounting and finance.
throwawaysea 5y ago
This headline feels like it is written to generate outrage. It’s not that it’s inaccurate (since it’s factual), but rather that it invokes a feeling of bailing out the world’s richest man instead of focusing on the company and what capability they bring. Bernie Sanders is quoted in the article, also with the same spin: “It does not make a lot of sense to me that we would provide billions of dollars to a company owned by the wealthiest guy in America”. This is about ensuring a healthy and competitive space technology ecosystem in the US. It’s about redundancy. It’s about not losing all the progress an organization like Blue Origin has made, since starting from zero will be more expensive. To me it seems prudent to make a $10B investment here, which is small when compared to other policy packages the Biden administration has proposed.
- ashneo76 5y ago
  He is a billionaire. He can bail out good own company. No money from tax papers is needed.
  - miga 5y ago
    If he is motivated by profit, he may sell or liquidate company as well.
- jdashg 5y ago
  I guarantee there were other articles on this topic posted elsewhere with a less provocative title, but they don't end up getting hits, here or elsewhere. C'est la vie.
  - bitcharmer 5y ago
    I'd say what's more provocative than the title is the fact that one of the richest men on Earth gets bailed out with public money.
- pavel_lishin 5y ago
  > It’s about not losing all the progress an organization like Blue Origin has made, since starting from zero will be more expensive. Would Blue Origin lose all progress? Why is the assumption that Bezos would fold up shop and shred everything? Yes, the headline is a bit provocative, but it's a valid criticism; as is the fact that the bailout was added by a Senator from the state that Blue Origin is based in, which makes it look like a much less altruistic move to ensure space exploration continues at a rapid pace, and more like a way to make sure her state gets a cut of the budget.
miga 5y ago
It is no-brainer for government to maintain a competitive landscape that is not a monopoly. And the government is the main customer here. When AWS vs Azure vs Google Cloud were weighted, there were arguments that the government should buy from at least two different companies to preserve competition. The biggest buyer in this market invests in maintaining the competition. Otherwise another market would be dominated by a monopoly to detriment of the biggest customer.

49 points by sharkweek 5y ago

dylan604 5y ago

The first rule of gov't spending is build two at twice the cost

aaron695 5y ago
I never got that quote (Contact) Take the premise governments are incompetent and overspend. You neither win or lose by getting two. The incompetence is built into the second same price. Except you have the second early. Building early has a cost, but given the way governments work the incentive for re-election is being under budget and fixing problems only when they become so bad they have too. Building early intuitively sounds better to me.
- dylan604 5y ago
  >Take the premise governments are incompetent and overspend. Is that hard to understand? It's definitely pork. Some gov't official from a particular state drafts legislation to ensure that a company in the same state gets the money that legislation sets aside regardless if they are the best choice. That has to raise flags to everyone, right? Most gov't contractors know that they can charge multiples of what it would actually cost because it's the govt paying for it. No govt contract has ever said, "hey, we know we initially bid to do task for $x, but we actually were able to do it for $x-20%". Instead it is always, "oops, we grossly misjudged the scope of work and allowed people to continue to make changes to the request, so we're now 5x the original bid". They allow the requests to make these changes because they know that it is guarantee to keep the money flowing and people employeed.
  - aaron695 5y ago
    Yes, but why is getting the second for the same price as the first bad? For major infrastructure I would expect the second to cost around the same price as the first. Materials, labour, time, bribes and corruption is all double. Any saving you might expect around paperwork and opportunity cost I don't mind, compared to waiting a decade then starting the process of getting it through government again. Even in the movie, (I don't know the book) think about the downtime if they had to fund the project again. And if you include 'in secret' it's even worse, because if the 3 letter agencies can do anything in secret for the same price as a public department that would me pretty amazing. Maybe the quote isn't cynical - https://www.youtube.com/watch?v=VTUrdizRZyw https://www.youtube.com/watch?v=VTUrdizRZyw
    - zwily 5y ago
      I never took that line as “haha, the government was dumb not to get a volume discount”, but more as “haha, only the government would be dumb enough to build two of these ridiculous things”, but really it ended up kinda pro-government cause having the second worked out in the end.

AtlasBarfed 5y ago

Yeah it looks bad that the richest man in the world's pet backyard rocket company is getting pork, but space is still the purvey of government funding. Even if Blue Origin is behind SpaceX, it's still good to have a couple irons in the fire pushing things. Solar was the same way. There were probably a half dozen failed solar startups that Obama threw money at that the right can pillory as boondoggles, but this is how private research will go if governments aren't doing massive amounts of public research. Some companies will succeed, others won't.

avmich 5y ago
> Even if Blue Origin is behind SpaceX, it's still good to have a couple irons in the fire pushing things. It is a sort of whataboutism - in this case, just because Blue Origin is a space company funded by a rich person, the actions should be the same. Yes, Blue Origin is similar to SpaceX. There are, however, both qualitative and quantitative differences, and both of those may justify different results when viewed by a third party. Does Blue Origin produces good results? Well. Blue Origin was created before SpaceX, but many would say the results of Blue Origin are more modest. So NASA may decide that funding Blue Origin doesn't justify added expenses. Does Blue Origin need money? It could be funny, but Jeff Bezos can well fund the company - he even promised giving them a billion a year. That kind of funding is significantly different from, for example, NASA's help to SpaceX right after forth Falcon-1 flight. So NASA's money may not go as long in the case of Blue Origin. There are more modest companies where NASA help would likely achieve more. I'd name Sierra Nevada Company with Dream Chaser and Master Space Systems with their landers. Big aggregations of airspace behemoths, themselves created by merging multiple airspace companies and eliminating competition don't often produce results with reasonable price tags.
- AtlasBarfed 5y ago
  You're not wrong, but to me it's still positive funding. It's not perfect, but it is far from the worst stimulus / funding the government does. And it probably wouldn't have happened without the lobbying, so it's not like this is taking money from other projects, at least in terms of government accounting and finance.

throwawaysea 5y ago

This headline feels like it is written to generate outrage. It’s not that it’s inaccurate (since it’s factual), but rather that it invokes a feeling of bailing out the world’s richest man instead of focusing on the company and what capability they bring. Bernie Sanders is quoted in the article, also with the same spin: “It does not make a lot of sense to me that we would provide billions of dollars to a company owned by the wealthiest guy in America”. This is about ensuring a healthy and competitive space technology ecosystem in the US. It’s about redundancy. It’s about not losing all the progress an organization like Blue Origin has made, since starting from zero will be more expensive. To me it seems prudent to make a $10B investment here, which is small when compared to other policy packages the Biden administration has proposed.

ashneo76 5y ago
He is a billionaire. He can bail out good own company. No money from tax papers is needed.
- miga 5y ago
  If he is motivated by profit, he may sell or liquidate company as well.
jdashg 5y ago
I guarantee there were other articles on this topic posted elsewhere with a less provocative title, but they don't end up getting hits, here or elsewhere. C'est la vie.
- bitcharmer 5y ago
  I'd say what's more provocative than the title is the fact that one of the richest men on Earth gets bailed out with public money.
pavel_lishin 5y ago
> It’s about not losing all the progress an organization like Blue Origin has made, since starting from zero will be more expensive. Would Blue Origin lose all progress? Why is the assumption that Bezos would fold up shop and shred everything? Yes, the headline is a bit provocative, but it's a valid criticism; as is the fact that the bailout was added by a Senator from the state that Blue Origin is based in, which makes it look like a much less altruistic move to ensure space exploration continues at a rapid pace, and more like a way to make sure her state gets a cut of the budget.

miga 5y ago

It is no-brainer for government to maintain a competitive landscape that is not a monopoly. And the government is the main customer here. When AWS vs Azure vs Google Cloud were weighted, there were arguments that the government should buy from at least two different companies to preserve competition. The biggest buyer in this market invests in maintaining the competition. Otherwise another market would be dominated by a monopoly to detriment of the biggest customer.