Is the Space Industry facilitating “legal” money laundering?

5th Feb 2020
Is the Space Industry facilitating “legal” money laundering?

And is horizontal launch the main conduit for siphoning of government funds?

Many countries have been operating in the Space sector for decades, but few have made the levels of progress you would expect from the massive amounts of cash ploughed into this industry. None is more evident than America. And the UK should stand up and take notice, learning from the mistakes of the past as it moves to create its own space industry.

If you look at the USA, for example, Elon Musk has from what we see, made more progress in a short period of time than the US government has in the many decades in which it has ploughed billions of dollars into space projects. The US government projects have seen billions handed to the likes of Lockheed Martin, Boeing and Airbus, often with little or no results. Contrast and compare this to the privately funded initiatives by Elon Musk and Jeff Bezos, who appear to be managing far more streamlined and cost effective operations while actually delivering results.

Boeing, for example, recently announced they were pulling out of the US Phantom Express project, having received 150m USD, ultimately leading to the closure of that project. Boeing’s only visible progress was to test the AR-22 engine (manufactured by Aerojet Rocketdyne) and to build a composite LOX fuel tank. There has been absolutely no sign of even the beginnings of the actual launch vehicle other than a rudimentary prototype. Compare this to the 100m USD that Elon Musk used to get his SpaceX enterprise up and running. Musk unveiled his Dragon aircraft in 2006, 18months after the project started.

This wasn’t the first time that Boeing has been involved in a failed launch programme funded by the US government. The ALASA programme which was intended to launch 45kg satellites from an F-15 fighter jet was cancelled in 2015 having failed to fulfil the project’s requirements.

We should also take a close look at Rocketplane Kistler, the company that you have likely not heard of but who were jointly awarded the contract along with SpaceX to supply the International Space Station. Kistler promised to build a re-usable spacecraft for the project and were in line to receive just over 200m USD from NASA to fulfil the contract. But the spacecraft never emerged and the company had received millions of dollars including $18m in State tax breaks. Rocketplane Kistler were dropped from the project just over a year later having failed to meet the milestones set out by NASA. The company and its subsidiaries then filed for bankruptcy within three years of being awarded the contract. There were no spacecraft on the asset list when the company was wound down. The only assets were the tooling equipment that would have been used to build the rocket as well as a handful of patents and trademarks.

The pattern emerging here is that horizontal launch projects have not only perpetually failed to deliver, but have continually managed to re-direct billions of taxpayer dollars into huge corporations without the level of accountability you would expect to see with such arrangements.

With Boeing having failed to deliver as much as a wing or a nose cone on two separate government funded projects and able to simply walk away is nothing short of incredible.

We continue to see similar stories across the sector, with Virgin failing to deliver its horizontal Virgin Galactic SpaceShip II, despite promising a maiden flight by 2009. Richard Branson’s company raised $20m from none other than Boeing just last year. The company also received an injection of $280m in investment in 2010 from an Abu Dhabi investment fund. They received a further $100m from the same fund a year later. So, including the initial $100m investment by Richard Branson, there appears to have been at least $500m that has funnelled through the company that has delivered absolutely nothing.

Virgin have also secured funding from the UK government to conduct horizontal launches from an airport in Cornwall, England, which leads one to think about whether any true level of due diligence has been carried out. With billions of dollars being pumped into horizontal launch projects across the states there should have been some red warning flags for not only the UK Space Agency but also the likes of Cornwall County Council who have also injected millions into the project.

To date, there has been no successful horizontal rocket launch project still commercially in operation and billions of US dollars have been squandered by Boeing, Lockheed Martin & Virgin in their attempts to deliver such a project over 20 plus years. So, why is this still being banded about as a viable way of getting satellites into orbit given the consistent failures of the past?

The only obvious explanation is that both the US and UK governments are all too readily willing to hand over billions to those huge companies with whom they have cosy relationships. This is quite simply a huge “legal” money laundering operation that has been going on for decades. There can be no other explanation.

It’s not just the horizontal rocket launch projects that are facilitating the squandering of huge amounts of cash from governments. In the UK right now, Lockheed Martin have already been “gifted” 31m USD to provide vertical rocket launch facilities. That was nearly two years ago. So, what have they delivered? So, far…. nothing. Zero. Zilch.

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