Biden’s NASA administrator slams the cost-plus contracts he endorsed when he was a senator
Bill Nelson, Biden’s NASA administrator and a former Democratic Party senator from Florida, made it clear during his testimony before a subcommittee of the Senate Appropriations committee today that he condemns cost-plus contracts and no longer wants to use them for any NASA project, even though he demanded NASA use such contracts when he was a senator.
Nelson was asked what, in his opinion, was the biggest threat to NASA’s goal of landing humans on the Moon by 2025. Nelson responded that the agency needed competition in its program to develop a Human Landing System. In other words, he wanted Congress to support NASA’s request for funding to develop a second lander alongside SpaceX’s Starship vehicle.
But Nelson didn’t stop there. He said Congress needs to fund this lander contract with a fixed-price award, which only pays companies when they reach milestones. This contracting mechanism is relatively new for the space agency, which traditionally has used “cost-plus” contracts for large development programs. Such awards pay contractors their expenses, plus a fee. “I believe that that is the plan that can bring us all the value of competition,” Nelson said of fixed-price contracts. “You get it done with that competitive spirit. You get it done cheaper, and that allows us to move away from what has been a plague on us in the past, which is a cost-plus contract, and move to an existing contractual price.”
The significance of Nelson’s remarks is that it bluntly signals that the Biden administration has now wholly bought into the ideas I put forth in Capitalism in Space. Nelson wants NASA to be a customer that buys what it needs from the private sector, and to do it as inexpensively as possible. He also wants to encourage competition by allowing that private sector to own and control what it builds.
In the past, a new administration would have abandoned the policies of the past administration. Instead, the Biden administration is accelerating the Trump administration’s policy of encouraging private enterprise and eliminating cost-plus contracts.
The future of the American space industry appears bright indeed.
This statement by Nelson also indicates that the future of SLS is now very precarious, especially because it is being built almost entirely on cost-plus contracts. Any serious failure could kill it. And even if its next launch succeeds, further launches hang now by a very thin political thread. And the more success private space has, the thinner that thread will become.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
Bill Nelson, Biden’s NASA administrator and a former Democratic Party senator from Florida, made it clear during his testimony before a subcommittee of the Senate Appropriations committee today that he condemns cost-plus contracts and no longer wants to use them for any NASA project, even though he demanded NASA use such contracts when he was a senator.
Nelson was asked what, in his opinion, was the biggest threat to NASA’s goal of landing humans on the Moon by 2025. Nelson responded that the agency needed competition in its program to develop a Human Landing System. In other words, he wanted Congress to support NASA’s request for funding to develop a second lander alongside SpaceX’s Starship vehicle.
But Nelson didn’t stop there. He said Congress needs to fund this lander contract with a fixed-price award, which only pays companies when they reach milestones. This contracting mechanism is relatively new for the space agency, which traditionally has used “cost-plus” contracts for large development programs. Such awards pay contractors their expenses, plus a fee. “I believe that that is the plan that can bring us all the value of competition,” Nelson said of fixed-price contracts. “You get it done with that competitive spirit. You get it done cheaper, and that allows us to move away from what has been a plague on us in the past, which is a cost-plus contract, and move to an existing contractual price.”
The significance of Nelson’s remarks is that it bluntly signals that the Biden administration has now wholly bought into the ideas I put forth in Capitalism in Space. Nelson wants NASA to be a customer that buys what it needs from the private sector, and to do it as inexpensively as possible. He also wants to encourage competition by allowing that private sector to own and control what it builds.
In the past, a new administration would have abandoned the policies of the past administration. Instead, the Biden administration is accelerating the Trump administration’s policy of encouraging private enterprise and eliminating cost-plus contracts.
The future of the American space industry appears bright indeed.
This statement by Nelson also indicates that the future of SLS is now very precarious, especially because it is being built almost entirely on cost-plus contracts. Any serious failure could kill it. And even if its next launch succeeds, further launches hang now by a very thin political thread. And the more success private space has, the thinner that thread will become.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
When Eric Berger posted an initial tweet about this article, my reply was ‘All is proceeding as Robert Zimmerman has foreseen.”
“The significance of Nelson’s remarks is that it bluntly signals that the Biden administration has now wholly bought into the ideas I put forth in Capitalism in Space.”
Then why is it hindering SpaceX? Just because they hate Musk and his presumed politics?
I continue to believe that there is no “stop SpaceX” policy per se. It’s just bureaucracies being slow and obstructive as is their nature, and the administrators that could push for a resolution having no will to do so, either because they don’t care, support obstructionism themselves, or sense that Musk is out of favor.
This article supports my belief, in that it’s just one more bit of evidence that NASA itself is very happy with SpaceX and the programs that have led to SpaceX delivering what it has, and want to expand on that, getting more out of SpaceX and the myriad other companies following in their path. But the other departments that are bastions of the left, eg Labor, the EPA, etc, are still in “private corporations bad” mode.
“But the other departments that are bastions of the left, eg Labor, the EPA, etc, are still in “private corporations bad” mode.”
And that’s the point that disproves the idea the Biden Administration favors free enterprise in space. These departments are part of the Executive Branch and work for the Chief Executive. If Biden was serious about free enterprise in space, he’d start knocking heads together until he got compliance. These organizations sense the way the wind is blowing politically and adjust their sails accordingly. Right now, the signal they are getting from the White House is that there is no need to change course.
Biden is agnostic on space…and Bill just wants something flying to the Moon before China gets there. You have heard of middle management? This is middle gov’t. which has escaped all oversight/notice of several administrations all distracted by more pressing matters: “Yes Chief, I’ll get right on that.” And nothing short of a long ride off a short pier in a plastic-lined trunk will change anything.
Back in the day Obiden wasn’t happy with roe vs Wade, said it went to far.