Partisan Food Fight Erupts Over NASA, Commercial Space
There is a time and a place for "cost-plus" contracts that have been traditionally used by NASA over the years (along with the Department of Defense for a great many projects). It is based upon the very successful model used for the Manhattan Project, where a bold goal was established by the government... something seen as critical perhaps even to the survival of the country itself. As to if that was true for building a nuclear bomb or flying people to the Moon could be debated, but the point is that those were set out as significant goals that simply had to be met, and how much it cost to get them accomplished was of relatively minor importance.
It is also important to note that while there were scientists who said that such endeavors were in theory possible, nobody knew at all how to actually get them accomplished. It really is exploring the frontier of human knowledge, where going to the Moon wasn't even conclusively proven to be even possible using any kind of machine on a practical level. Certainly entire new technologies had to be invented from scratch for both the Manhattan Project and the Apollo Project. If you asked even well respected contractors how much it was going to cost to build those devices, they would just give you a blank stare. Oh, they might come up with a rough estimate, but the truth is nobody knew how much it was really going to cost. It had never been done before, so there was no possible way to even remotely guess a great many of the costs. Certainly no sane contractor would ever enter into a contract with the government to produce a device or provide a service when they can't even reliably depend upon even the order of magnitude for the costs they will come into.
That is why you need to have the government take the risk of the costs for such significant endeavors, which is the "cost" part of the contracting model. The "plus" is a guaranteed profit that the company will earn simply for participating and getting involved with such a project. That makes shareholders happy, but it also allows us as citizens to receive the benefits of a company which has the skills and equipment necessary to pull off such important national endeavors.
One of the problems after the Apollo project (and the Manhattan Project in terms of DOD contracts) is that it was considered normal to use such a contracting model for everything else, even if they didn't need such a contract. Sending people into space to go and dock with the ISS is something with a long history and a great many rockets that have been developed over the years capable of such a feat. It is indeed possible to estimate fairly well how much it will cost to perform such a launch down to just a few dollars. For that reason, the cost-plus contracts really should have been abandoned a long time ago.
Going to Mars still has a whole bunch of unknowns about it, and for building the actual spacecraft or even the forward logistical supplies that need to be sent to Mars ahead of time is something that isn't really well known. There have been several spacecraft that have gone to Mars already, so there is at least some history there... it doesn't need to be purely cost-plus, but there might still be some role to play for using that model.
The SLS program is one that is using the "cost-plus" contracting model, which is one of the reasons why it will eventually die as a huge embarrassment to the good United States Senators who held advanced degrees in aeronautical engineering and designed the program through legislation in the first place. It shouldn't be all that complicated to send a big rocket into low-Earth orbit from Kennedy Space Center. Heck, the SLS won't even be the largest vehicle sent from KSC into LEO.
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