Elon Musk may very well be one of the largest beneficiaries of America’s generous system of corporate subsidization. Between his two companies—SpaceX and Tesla--Musk has received nearly $9 billion in taxpayer-funded federal subsidies. And that doesn’t even take into account the billions of dollars provided in the form of government contracts. All in all, the United States government has invested far more money into SpaceX and Tesla than Elon Musk ever could, and his businesses are all the better for it. But are his results any better for it?
One might suspect that the federal government has done more than enough to ensure Musk’s success. (Talk about picking winners and losers.) You would be forgiven for expecting Musk to at least be grateful for all those American taxpayer dollars given to him. A few people might even hope that Musk would begin the process of transitioning away from federal subsidization and move toward market profitability as most businesses must in order to survive. But that few would be sorely mistaken. Elon’s appetite for federal dollars is more voracious than ever, and he has shown he will go to great lengths to get what he wants, even if that means suing the government itself. (After all, a taxpayer dollar given is an investment dollar Elon didn’t have to procure. And private-sector expectations of return on investment is considerably different than that of the government.)
On May 17, SpaceX, Musk’s private aerospace company, filed a lawsuit against the federal government, protesting their contract bidding process. Details surrounding the litigation are difficult to come by since SpaceX requested that any information regarding the suit be kept private. Nevertheless, journalists have pointed out that the lawsuit coincides with a government aerospace program called the Launch Service Agreement (LSA). And given that the United States Air Force is currently moving forward with contract bids for the LSA project, the Launch Service Agreement’s bidding process is almost certainly the subject of the lawsuit.
But why would Musk decide to sue the federal government over an ongoing project like the Launch Service Agreement? It certainly would appear that it’s because Musk feels entitled to the federal dollars the program provides. In October 2018, despite being the odds-on favorite to be awarded an LSA contract, SpaceX was not selected to participate in the program’s initial phase. SpaceX – in true “give me what I want” style - decried the decision and lobbied Congress to alter the Air Force’s selection—to little success. Its previous attempts having proved unfruitful, SpaceX is apparently redoubling its efforts to remain on the federal government’s dole.
Unfortunately, this isn’t the first time Musk has sued the federal government to get what he wants. SpaceX has filed numerous lawsuits against the United States in the past. Most recently, Musk initiated a separate 2019 suit protesting NASA’s decision to award a $150 million contract to the company’s foremost competitor. Within the official protest, Musk asserted that SpaceX deserved to be chosen because – according to Musk - it was the superior option.
However, the argument for SpaceX’s superiority is becoming harder to make as the company is struggling to perform. Recently, Musk’s aerospace firm suffered a catastrophic setback when its Crew Dragon shuttle exploded during testing. The mishap spooked both the U.S. military and NASA, creating the potential for serious delays of America’s crewed spaceflight to the moon. That severe failure, coupled with the Crew Dragon’s inadequate parachute testing results, have raised serious concerns about SpaceX’s viability as an aerospace contractor moving forward.
SpaceX’s performance regarding the Launch Service Agreement was no better. When discussing SpaceX’s LSA bid, Musk openly admitted that his company missed the mark by presenting a subpar proposal. According to Musk himself, SpaceX was not selected to receive an LSA contract because its performance wasn’t up to snuff. But did that deter SpaceX from suing? Of course not. Musk’s desire to secure federal funding was apparently too strong to do anything but fight for money that his company doesn’t deserve.
Despite Musk’s purported hunger for government contracts and subsidies, the American taxpayer owes him nothing. The United States has already provided Musk’s companies with ample funding. But it seems like Musk’s aerospace firm, in particular, is determined to squander the opportunities and good will it was given. By attempting to force itself into the Launch Service Agreement, SpaceX is only highlighting its worst qualities: a penchant towards entitlement in the face of failure and unwavering reliance on federal money. Neither of which do a reliable government contractor make.
One might suspect that the federal government has done more than enough to ensure Musk’s success. (Talk about picking winners and losers.) You would be forgiven for expecting Musk to at least be grateful for all those American taxpayer dollars given to him. A few people might even hope that Musk would begin the process of transitioning away from federal subsidization and move toward market profitability as most businesses must in order to survive. But that few would be sorely mistaken. Elon’s appetite for federal dollars is more voracious than ever, and he has shown he will go to great lengths to get what he wants, even if that means suing the government itself. (After all, a taxpayer dollar given is an investment dollar Elon didn’t have to procure. And private-sector expectations of return on investment is considerably different than that of the government.)
On May 17, SpaceX, Musk’s private aerospace company, filed a lawsuit against the federal government, protesting their contract bidding process. Details surrounding the litigation are difficult to come by since SpaceX requested that any information regarding the suit be kept private. Nevertheless, journalists have pointed out that the lawsuit coincides with a government aerospace program called the Launch Service Agreement (LSA). And given that the United States Air Force is currently moving forward with contract bids for the LSA project, the Launch Service Agreement’s bidding process is almost certainly the subject of the lawsuit.
But why would Musk decide to sue the federal government over an ongoing project like the Launch Service Agreement? It certainly would appear that it’s because Musk feels entitled to the federal dollars the program provides. In October 2018, despite being the odds-on favorite to be awarded an LSA contract, SpaceX was not selected to participate in the program’s initial phase. SpaceX – in true “give me what I want” style - decried the decision and lobbied Congress to alter the Air Force’s selection—to little success. Its previous attempts having proved unfruitful, SpaceX is apparently redoubling its efforts to remain on the federal government’s dole.
Unfortunately, this isn’t the first time Musk has sued the federal government to get what he wants. SpaceX has filed numerous lawsuits against the United States in the past. Most recently, Musk initiated a separate 2019 suit protesting NASA’s decision to award a $150 million contract to the company’s foremost competitor. Within the official protest, Musk asserted that SpaceX deserved to be chosen because – according to Musk - it was the superior option.
However, the argument for SpaceX’s superiority is becoming harder to make as the company is struggling to perform. Recently, Musk’s aerospace firm suffered a catastrophic setback when its Crew Dragon shuttle exploded during testing. The mishap spooked both the U.S. military and NASA, creating the potential for serious delays of America’s crewed spaceflight to the moon. That severe failure, coupled with the Crew Dragon’s inadequate parachute testing results, have raised serious concerns about SpaceX’s viability as an aerospace contractor moving forward.
SpaceX’s performance regarding the Launch Service Agreement was no better. When discussing SpaceX’s LSA bid, Musk openly admitted that his company missed the mark by presenting a subpar proposal. According to Musk himself, SpaceX was not selected to receive an LSA contract because its performance wasn’t up to snuff. But did that deter SpaceX from suing? Of course not. Musk’s desire to secure federal funding was apparently too strong to do anything but fight for money that his company doesn’t deserve.
Despite Musk’s purported hunger for government contracts and subsidies, the American taxpayer owes him nothing. The United States has already provided Musk’s companies with ample funding. But it seems like Musk’s aerospace firm, in particular, is determined to squander the opportunities and good will it was given. By attempting to force itself into the Launch Service Agreement, SpaceX is only highlighting its worst qualities: a penchant towards entitlement in the face of failure and unwavering reliance on federal money. Neither of which do a reliable government contractor make.
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