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Comment by shapefrog | Hacker News Reader

Musk has pocketed $5bn and that excludes "government contracts".

It would be fair to say they are really just an arm of the government right ?

Government contracts are work done in exchange for money. They are not subsidies as much as you might wish for them to be.

If the government buys 1000 pens because it literally needs them to do its job, it isn't subsidizing the pen industry.

In the case of Musk, that isn't true. The COTS contract awarded half the money ($150M) without any hardware built--it was up-front. This amounted to more than the total amount Elon invested and more than covered Falcon 1, meaning he never had to spend his own money.

But it was a contract for work yes? That sounds more like a pre-payment than a grant.

If presenting a PowerPoint you already made is work (for $150M) then sure.

Others got the same (or better) deal no?

I believe the deal here was very unusual--not unless they had someone with government power directly pulling big strings. In this case Griffin.

Part of the money being given up front doesn't make it a subsidy either...

The COTS program required the development of an appropriate vehicle after a competitive process to evaluate different proposals. You're acting like it was money to cover his previous costs and not money intended to pay for the development of the thing they were being contracted for, along with associated milestones for further payments. And hell, not like they were the only ones to get that money or even the ones to get the most money, they were the only ones to actually manage to deliver.

Why is it that only when it comes to a Musk company people act like these are unique contracting methods? You can easily find this info using the very thing you're using to post deceitful half truths.

Edit: Actually it isn't even a half truth, it's outright wrong, the initial payment SpaceX got was $23M. Everything else was dependent on milestones and design reviews, with NASA being able to cancel any time for non-performance (as they had done with one of the other companies under the program). The end result was NASA paying slightly less than half the development cost that SpaceX incurred.

https://arpa-e.energy.gov/sites/default/files/Lindenmoyer_%2...

Look at the actual COTS agreement wording: https://www.nasa.gov/centers/johnson/pdf/189228main_setc_nnj...

page 34 details the milestones.

The first 12 milestones are paper design / powerpoints. Half the money before any hardware development at all.

Mike Griffin structured it this way for Elon.

Look, I get that you're trying to be malicious, but you could do a better job than that. They literally describe what the criteria for successful design reviews are in Appendix 3.

Hint: Design reviews are not "powerpoints". They're typically several hundred to several thousand page technical documents.

The point is Elon didn't risk his own money as is oft dramatized. In fact they were mostly spreadsheets and PowerPoints to obtain that money which could then be used for build out.

that excludes government contracts

Absolutely?

At this point we are definitely treating SpaceX as the US space agency and not a private business. People were outraged when Musk was considering whether to continue supporting Ukraine with StarLink. Imagine if he refused to do the same when China cuts the cables to Taiwan, someone will probably try to charge him with treason, only to realize that a private business has no obligation to do so.

Support as in keep charging $500 for $1500 equipment and allowing use that wasn't agreed on at the outset?

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