Misplaced Confidence? The US Private Space Sector vs. China

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Misplaced Confidence? The US Private Space Sector vs. China

American confidence that its private space sector can take on China alone is wildly misplaced.

Misplaced Confidence? The US Private Space Sector vs. China
Credit: NASA on Unsplash

When China landed on the far side of the lunar surface early this year, Americans tended to dismiss the achievement. Either they said some version of “been there, done that, 50 years ago,” or commented that it was nothing to be concerned about. China would have to contend with not the U.S. government sector in space led by NASA, but the vibrant and successful U.S. private space sector led by Jeff Bezos’s Blue Origin and Elon Musk’s SpaceX.

Certainly, the U.S. private space sector today has a significant advantage. But China is hot on their heels — encouraging their own billionaires and private space companies (Onespace, Landspace, iSpace, Linkspace) to enter the sector. To enable this, President Xi Jinping and the Chinese state have created a supportive environment. While the U.S. private space program has a 19 year head-start with the founding of Blue Origin in 2000, the Chinese private space sector that took off around 2015 drew an investment of $2 billion in 2018 alone [China’s state funded space program takes about $6 billion annually] and is growing rapidly.

In 2018, iSpace and Onespace began sub-orbital testing with support from the Chinese state. While Onespace’s attempt to launch its OS-M1 four-stage rocket, the Chongqing Liangjiang Star, to place a satellite in orbit failed on March 27, such failures are neither surprising nor new in the private space launch industry. In 2006, Elon Musk’s SpaceX failed in its first launch of the Falcon 1. It failed again to reach orbit in its second and third attempts. Zach Dunn, Senior Vice President of SpaceX production and launch recalled that period: “[W]e all knew that the stakes were incredibly high…it was tense. There was a lot of pressure.” SpaceX finally succeeded in its fourth attempt and the rest is, of course, history.

The critical point of note with regard to the Chinese private space industry is how fast it is developing. The same Onespace, while failing in its first attempt to place a satellite into orbit, succeeded in its next two sub-orbital launches with its OS-X rockets in 2018. CEO, Shu Chang, a graduate of Beihang University [the same university that conducted the 365 days simulation of living in a Moon lab], indicated that his company will conduct several launches of the OS-M launch vehicle this year to learn and enhance technological successes. Shu indicated that:

What we’re focusing on now is the OS-M launch vehicle, which is around 20 tons. Its third and fourth stage engine were successfully tested in late October [2018]. Next, we will conduct several tests for OS-M, such as the structure static test, a comprehensive electrical system test, an attitude control test, and a propulsion system vibration test, etc.

Over the past three years, nearly 60 private space startups have entered the private launch industry, supported by the Chinese state. Spokesperson of the China National Space Administration (CNSA), Li Guoping, specified:

The output value of the satellite application sector makes up over 80 percent of the whole satellite industry chain. So we encourage private companies and social capital to invest in the application of satellite communication, remote sensing and navigation…When we make a top-level plan for China’s aerospace development, we will consider the development of commercial space activity. The government will open space programs that can be carried out in a commercial way, and buy services from commercial companies

Since 2014, Xi has urged China’s private space sector to emerge as the leader in the implementation of civil-military integration strategy.” Xi’s policy guidance has been followed up by the PLA, which opened its Jiuquan Satellite Launch Center (China’s primary launch facility) in the northwestern Gobi Desert for private rocket launches. This civil-military integration has been identified as a priority by Xi for China’s overall national strategy with regard to outer space. The planning chief of the Jiuquan Satellite Launch Center, Jia Lide, stated that “favorable policies and targeted measures have been created for the benefit of private space enterprises.”

The latter point is particularly important.  The U.S. private sector does very well with strong government support, through programs like Commercial Orbital Transportation System (COTS), Commercial Crew Program, and now the Commercial Lunar Payload Service (CLPS). Most U.S. space industries still rely to a significant degree on the government market either to get started or to stay solvent. 

It is also cost-effective for the U.S. taxpayer to invest in private space companies. NASA’s internal estimates are that if it had attempted to develop SpaceX Falcon 9 using the same Cost-Plus contract it is using on its Space Launch System (SLS), it would have cost the taxpayer significantly more. Similar differences have been estimated for commercial propellant depots, Moon Bases, and use of Asteroid resources.

But the U.S. commercial sector is motivated by a small number of billionaires with an ideological drive for space. Any or all of them could face individual professional, financial or personal troubles. There are reports that Elon Musk’s security clearance, which enables him to contract with the U.S. government, is under review, after an incident in which he smoked marijiana while recording the podcast and YouTube show “Joe Rogan Experience” in September 2018. He is also facing legal problems with the U.S. Securities and Exchange Commission over Tesla tweets. Jeff Bezos, founder of Blue Origin, is facing personal troubles of his own, to include his allegations of blackmail by the National Enquirer, and the alleged involvement of Saudi Arabia in hacking his private phone.

Amid this drama, Chinese Premier Li Keqiang offered Musk a “green card” if he decides to come work in China, during his meeting with Musk in Beijing in January 2019. History will remind us that Qian Xuesen, the man solely responsible for the founding of China’s space and rocket program, ironically played an instrumental role in the founding of the Jet Propulsion Laboratory (JPL) for NASA in the 1930s and 1940s. Qian left China in 1935 on a Boxer Rebellion Indemnity Scholarship, completed his education in MIT and CALTECH. During World War II, Xuesen served in the United States Government’s Science Advisory Board, had the rank of Lieutenant Colonel in the U.S. Army Airforce, and was sent to Germany where he debriefed German scientists, including Werner von Braun. Von Braum subsequently developed the Saturn V for the United State, the rocket that took humanity to the Moon in 1969. Xuesen’s mentor, Theodore Von Kármán wrote of him, “At the age of 36, he was an undisputed genius whose work was providing an enormous impetus to advances in high-speed aerodynamics and jet propulsion.” In a twist of fate, Xuesen’s application for U.S. citizenship was denied in the 1950s, and he was accused of being a communist. None of those allegations were ever proved. In 1955, he was deported to China. Qian went on to found China’s ballistic missile program.

While drama swirled around Musk and Bezos in the United States, China funded and established the world‘s first space based solar power plant experiment in Chongqing this year and has announced several upcoming robotic probes to the Moon, to include both poles and to establish a lunar base by 2036.  Deputy Head of the Chongqing Collaborative Innovation Research Institute for Civil-Military Integration, Xe Gengxi, indicated about this experiment:

We plan to launch four to six tethered balloons from the testing base and connect them with each other to set up a network at an altitude of around 1,000 meters. These balloons will collect sunlight and convert solar energy to microwave before beaming it back to Earth. Receiving stations on the ground will convert such microwaves to electricity and distribute it to a grid.

In contrast, the United States has no national program to develop major space industrial architecture such as a Solar Power Satellite, or lunar and asteroid mining. The result of this lack of support is clear: Without the U.S. government as an early market, it has left its start-ups to flounder, with two asteroid firms, Planetary Resources Incorporated (PRI) and Deep Space Industries (DSI) being bought out because of an inability to secure funds, and others, like MoonExpress, having to accept funds from the PRC’s TENCENT holdings, famous for starting China’s popular messaging app, WeChat. Although there have been, over the past decade, a number of Space Solar Power start-ups (Solaren, SolarHigh, Space Island Group, Planetary Power, SpaceEnergy), without proactive government support to assist in the regulatory environment, provide incentives, tax credits, or reduce the market risk, none have been able to carry their ideas forward. 

The complacent attitude by the U.S. government space sector towards China’s investment in outer space puts the U.S. commercial space sector in a weaker position as research funds required for critical space projects are hard to find. This lack of strategic perspective and an inability to take seriously China’s stated ambitions of permanent presence in outer space and to utilize space-based resources have amounted to a lack of foresight and vision. Although U.S. space thinkers like Paul Spudis, Robert Zubrin, and others have offered compelling ideas for lunar industrialization, such strategic visions have yet to appear on any NASA roadmap. While the U.S. National Space Council’s March 26 meeting in Huntsville, AL recommended the lunar program focus on science and resource utilization, missing from the recommendations were specific space industrial production goals that will drive the U.S. government space sector, offer incentives to private space startups, and make it difficult for NASA to underperform.

Chinese interest on the Moon is clear: The Moon offers significant economic and logistical gains. Certainly, U.S. Vice President Mike Pence’s direction to NASA to put humans back on the moon is a step in the right direction. But a fundamental question remains: Why go to the Moon again without a long-term industrial policy? Sending astronauts to the lunar surface is one thing; establishing a lunar facility to ignite new innovation and private enterprise is quite another.

A similar complacent attitude in telecommunications has meant that now Huawei is the industry leader in 5G and is setting the standards across Europe, Asia and Africa, opening the door to a global police state. Is that what we want for the final frontier?

Dr. Namrata Goswami is an independent senior analyst and author. Her work on “Outer Space and Great Powers” was supported by the MINERVA Initiative Grant for Social Science Research. Currently, she is working on a book on “Great Powers and Resource Nationalism in Space” to be published by Lexington Press, an imprint of Rowman and Littlefield.