Opinion

Elon Musk Passes the Hat Again on Capitol Hill… And in China

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Posted: Sep 10, 2019 9:42 AM
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Elon Musk Passes the Hat Again on Capitol Hill… And in China

Source: AP Photo/Chris Carlson, File

Lost amid the ongoing trade war with China was the news that Rent Seeker Extraordinaire Elon Musk paid our trade enemy a visit. The alleged reason was to attend a summit on AI. The real reason to go rent seeking is in a whole new hemisphere.

The rent-seeking paid off. The Chinese Transport Ministry announced that Chinese Tesla consumers would receive a 10% purchase tax exemption. Currently, Tesla stands as the only foreign-owned manufacturer to be granted such an exemption.

But here’s the problem: Musk’s overture to China directly conflicts with the best interests of America. After all, President Trump specifically urged companies to avoid negotiating business deals with China and begin seeking alternatives just days before Musk’s move. For matters of national security, American businesses were asked to put country ahead of short-term profits. But Elon Musk simply couldn’t do that.

It’s obscene, and if Elon Musk had any shame…well…he doesn’t.

As if Musk’s China double-cross wasn’t bad enough, our own government is throwing scads of money at Musk’s ten-gallon hat, filling it with our tax dollars. This time around, Musk isn’t just lobbying for federal protections and subsidies for Tesla. Now, Musk is panhandling for his aerospace company, SpaceX—and once again he’s directly flaunting the Trump administration’s critical national security directives.

President Trump is currently moving forward with the National Security Space Launch (NSSL) program via the National Defense Authorization Act (NDAA). But at every turn, Musk has attempted to undermine the space program for his personal gain.

The NSSL was created for a specific purpose. As described by the Air Force, “The NSSL program is designed to continue to procure affordable National Security Space Launch Services, maintain assured access to space, and ensure mission success with viable domestic launch service providers.”

The key portion of that description is “domestic launch service providers.” Currently, the US relies on the Russian-made RD-180 rocket engine, and we’ve been waiting 25 years for a domestic replacement. America cannot afford any more delays in this program. America deserves to have the best domestic competitors providing the best technology for our national security launches.

Enter Elon Musk.

His company, SpaceX, sued the federal government because it awarded $2.3 billion to the other three competitors in Phase 1 of the NSSL program…despite admitting that SpaceX wrote a lousy proposal.

That lawsuit, along with some likely hobnobbing with House Armed Services Committee Chairman Adam Smith (D-WA), allowed Musk to get a hugely detrimental amendment slipped into the NDAA.

That amendment provides something very favorable to Musk and SpaceX: a massive government handout.

If the amendment passes, SpaceX will have a far easier time getting chosen for Phase 2 of NSSL. Smith’s amendment allows a competitor who wasn’t selected in Phase 1 but did get chosen in Phase 2, to have access to a $500 million “certification and infrastructure” fund.
 
 That would, of course, refer to SpaceX. That’s also why this fund has earned the moniker, “The SpaceX Earmark.”

That’s bad enough, yet Bongiovi said that $500 million fund could require the Air Force to pony up $1.5 billion once a single Phase 2 contract is awarded. 

 So, it isn’t enough that Elon Musk wants $500 million in subsidies for himself. It also means draining our treasury by another billion dollars because he didn’t get his way the first time around. But the House’s NDAA would go even further. 

Beyond merely the SpaceX Earmark, the bill contains another provision that would shorten Phase 2 and loosen the NSSL’s competitive structure, which “would increase per-launch cost while simultaneously introducing risk and costs for some intelligence payloads.” 

Ultimately, the NDAA is a recipe for disaster, unnecessarily increasing both risk and costs. But the bill’s problems are deeper than mere logistics. It would also sacrifice our military’s commitment to greatness. 

Remember, SpaceX failed in Phase 1 of a program specifically designed to select the very best contractors to protect national security. And now, Musk is trying to change the rules of competition so that—despite missing the mark—his company can still be included. 

Rewarding a loser in Phase 2 is a de-facto weakening of national security. In a massive series of projects that affect both America’s national security its space flight capabilities, there is no room for that kind of error.

There is some good news, though. The Senate, all the House Republicans who voted against Smith’s amendment, and eight Democrats are all likely to reject the bill. What’s more, the White House strongly objects to Smith’s amendment and is pushing to have it removed. But the amendment itself won’t be the only problem.

The House version also commits less defense funding than either the Senate or the president want. The Trump administration also indicated that it would veto the NDAA if the House version passes.

The Senate must hold firm to the original bill, and President Trump should veto the NDAA and send it back. Doing so will not only protect our national security, but it will also send Elon Musk a message. Musk will no longer interfere to weaken America’s defense initiatives. And if he doesn’t like that fact, he can go back to rent-seeking in China.