2018 Space Symposium, Colorado Springs, Colo.

AIA President and CEO Eric Fanning
Space Symposium, Colorado Springs, Colo.
April 19, 2018
Remarks as prepared for delivery

It’s great to be back in Colorado Springs with so many friends and colleagues. I was last here in 2014, serving as Acting Secretary of the Air Force. During that time in the Air Force as well as leading the U.S. Army, I was confronted daily with just how integrated space systems are into modern military operations. There is no question in my mind that they are essential to preserving the peace, achieving victory on the battlefield, and enabling humanitarian operations around the globe. For those of you here today who provide space support to our men and women in uniform, you have my utmost appreciation.

Now, as the new President and CEO of the Aerospace Industries Association, I’m focused on the totality of space activities—commercial, civil and national security—all of which are important to our nation’s prosperity, strength and continued leadership in the world.

Each of these three legs of the space enterprise supports the other by promoting technology innovation and economies of scale, and by inspiring the future STEM workforce, an essential yet underappreciated component of the space industrial base.

I wanted to open by focusing on the commercial industry’s vital role in advancing and inspiring our space progress. What’s particularly fun about this topic is that I get to talk about how many of NASA’s bold missions, including human deep space exploration, require commercial space industry support.

Today, we’re witnessing an exciting burst in commercial space activities, a key enabler of civil and national security space initiatives.

Today, we’re witnessing an exciting burst in commercial space activities, a key enabler of civil and national security space initiatives. Innovative companies—both young and old, large and small—are reinventing the art of the possible by developing new space services and capabilities and reducing costs and time to market. Space companies are clearly one of the most dynamic sectors in the American economy.

There’s also a “wow” factor to consider. Bold new space missions spur renewed public interest in space. We first saw how much the public yearns for the return of Americans to deep space with the attention paid to the flight test of the Lockheed Martin Orion Multi-purpose Crew Vehicle a little over three years ago. More recently, it was remarkable how millions of people eagerly set aside their daily routines to pile into conference rooms or cluster around iPhones to witness the amazing SpaceX Falcon heavy launch.  The launch and recovery was the second most watched live-streamed event in the history of YouTube, and I’m confident that there will be many more YouTube-able events to come.

What’s more, launches like these are inspiring Generation Z to imagine its own place in the stars, and once again, imagining the careers that can get them there.

We are also seeing a dramatic change in the way we are turning our space dreams into reality.

At NASA’s inception 60 years ago, private industry was leveraged to develop launch vehicles and space systems for missions based on very specific NASA-driven design instructions, along with extensive government oversight. This model continued throughout much of NASA’s first fifty years.

Today, our space industrial base is far more mature, developing an extensive range of new space capabilities to meet a wide range of customer needs without government direction.  For mature space capabilities, such as launch and satellites, the commercial space industry has proven that it can deliver what the government requires without prescriptive oversight. Obviously, we still need continued government investment in technology. There’s no question that government will be heavily involved in the development of space systems for transporting humans on government missions. But it is indeed remarkable how far we’ve come.

This trend toward greater commercial responsibility in space began almost two decades ago with private telecommunications satellites and launch systems derived from legacy ICBMs like the Atlas and Delta. It is accelerating today with the Blue Origin’s New Shepard, Orbital ATK’s Antares, SpaceX’s Falcon, Stratolaunch Systems’ Stratolaunch and Virgin Orbit’s Launcher One, which are bringing new capabilities such as reusability to fruition, without government direction.

Both the Air Force and NASA deserve credit for this trend. The Air Force allowed development of the two Evolved Expendable Launch Vehicles or EELV families with minimal design direction. And NASA’s investments in its cargo resupply initiative for the International Space Station enabled the underlying technology for reusability of commercial booster rockets. Today, that partnership continues as NASA is committing to put payloads bound for the moon on commercially developed systems through its Lunar Exploration and Discovery initiative.

That’s not all. In addition to NASA’s Orion capsule being developed by Lockheed Martin for deep space exploration, industry has five other human space systems in development—Boeing’s Starliner, Blue Origin’s New Shepard capsule, Sierra Nevada’s Dreamchaser, SpaceX’s Dragon Two, and Virgin Galactic’s SpaceShip Two.

The message that industry wants NASA and the rest of the government to hear is simple. Keep it up! Keep taking advantage of private-sector know-how and operational effectiveness. Industry can be trusted to have a more responsible role in designing and developing new space systems, for both low Earth orbit and lunar operations. This will free up resources for agencies like NASA to focus on the cutting-edge technologies such as those that will take us to Mars and beyond.

By working on what we don’t yet know how to do, and on activities where there is no developed market yet, NASA will stay true to its pioneering heritage.

By working on what we don’t yet know how to do, and on activities where there is no developed market yet, NASA will stay true to its pioneering heritage. And with industry stepping up to develop services once solely the province of government, greater innovation and market growth is sure to follow.

So, imagine the near future. What if NASA were to provide industry proper incentives to develop on its own — without unnecessary oversight – lunar habitation modules, fuel depots and other supportive infrastructure? This model promises significantly reduced costs and more creative solutions, helping us reach these objectives on a faster timeline.

Importantly, these new ways of doing things doesn’t involve a divide between established and emerging space companies. Frankly, I hear all the time discussion of ‘old space’ versus ‘new space.’ But I believe that represents a false dichotomy. In fact, those space companies present at NASA’s creation, are just as much sources of innovation today as are the newer technology companies trying to disrupt the established. And for their part, these emerging space companies acknowledge their systems benefit from previous government investments in space technology.

There are many examples of long-term government R&D support being essential for later commercial success. We wouldn’t enjoy our modern air transportation system were it not for the investment of NASA’s predecessor—the National Advisory Committee for Aeronautics—in wind tunnel testing and deicing research. Had the government not invested in semi-conductors and integrated circuits for the Apollo moon landing and missile programs of the 1960s, Silicon Valley and the IT revolution wouldn’t have happened. And the many uses of GPS—from car navigation to locating a nearby restaurant with your cell phone—wouldn’t have been realized without government research leading to the Navstar GPS satellite network in the 1980s.

There’s also a symbiotic aspect in the government-space industry relationship. Just as government investment has aided the industry, the willingness of industry to step up to meet the government’s needs has benefited both parties. United Launch Alliance was created as a joint venture by Boeing and Lockheed Martin to assure dual launch capability for vital national security missions. This happened despite the lack of a commercial market to justify the commitment. Now, as commercial markets have grown and the government seeks lower launch costs, ULA is developing the Vulcan launch vehicle in partnership with Blue Origin to both reduce costs and increase opportunities for commercial users.

This is today’s American space industry. A dynamic sector constantly innovating in ways that are expanding options for civil and national security space activities.

With this in mind, our entire industry is pleased the government is developing missions that require industry participation, and seeks to promote the value of the commercial space enterprise.

We appreciate the focus of the newly-reconstituted National Space Council and the momentum it has provided NASA on its lunar gateway initiative. We also welcome the Space Council’s work on regulatory reform to enable more space enterprise. But any regulatory reform must embrace the full gamut of our industry, not just slices of it. And we’re grateful that after years of flatlined budgets, Congress recently provided a needed funding boost for NASA, both this year and the next.

But this optimism is tempered by a realization of the fleeting nature of the recent bipartisan budget deal. A new fiscal cliff is looming in October 2019. Unless Congress acts affirmatively, both defense and domestic discretionary agencies like NASA and NOAA, whose satellites are critical for weather forecasts, would have their budgets cut by a staggering 10 percent.

It might surprise many of you, but my association doesn’t advocate spending for spending’s sake. When critical national objectives are at stake, however, these agencies must be adequately resourced to accomplish the missions we’ve entrusted to them. AIA has called for NASA to receive a five percent boost in spending on an annual basis. Our advocacy is based on what the National Research Council’s Pathways for Exploration report said is necessary to achieve human space exploration goals. It also reflects the projected costs of priority missions highlighted in the National Academies’ decadal surveys for space and Earth science missions.

This concern about budgets also extends to the national security space arena. On Capitol Hill and elsewhere, we’ve pointed out that while private sector initiatives such as CubeSats and hosted payloads offer promising capabilities to support national security space—more government investment is also needed.

Since implementation of the Budget Control Act caps in 2013, investment in the replenishment and upgrading of dedicated national security space assets is at an 11-year low. The $8 billion “plus up” over five years in the President’s recommended budget for national security space is a good start.  But in less than 18 months, the current budget deal will expire, and absent the all too elusive political compromise, there will be real consequences.

I know people in this room are keenly aware of the vulnerabilities of our aging national security space systems to potential adversaries. We know those who wish us harm are working feverishly on anti-satellite capabilities. But we must recognize that the public, and many policy makers, do not routinely follow this issue. Also, our classification systems prevent knowledgeable people from sharing in detail their concerns about the extent to which this threat is growing.

That’s why AIA funded a new report by the Center for Strategic and International Studies entitled: Space Threat Assessment 2018. I hope by now you have received collateral materials from the report which details the nature and extent of emerging threats to our space assets.

The report, which will help educate policy makers about the threat and make the case for greater investment in these vital systems, underscores Director of National Intelligence Dan Coats’ recent warning that “we have to up our game if we’re going to stay competitive,” in the space environment.

We take so much for granted, but should [space] systems be taken offline or out by an adversary, life as we know it would change fundamentally.

And let me tell you something else: You need not be a space geek or military leader to share this concern. If you use cell phones and ATM machines, base your weekend plans on weather forecasts, or watch live broadcasts of the Olympics on television, be warned. It’s not only Defense Department satellites that are being targeted. Indeed, nearly all the conveniences provided by modern technology rely on space, from your car’s navigation system to your Nest thermostat: from cashing checks on your smartphone to the route your airplane takes. We take so much for granted, but should these systems be taken offline or out by an adversary, life as we know it would change fundamentally. Washington must take proactive steps now to harden and secure our critical space infrastructure.

It’s also worth highlighting the exquisite yet relatively fragile state of today’s American space industry. It’s far smaller than the sectors that produce automobiles, computers or aircraft. Thus, ensuring its continued vitality demands more than robust budgets for civil and national security space activities, and policies that encourage initiative by commercial space companies. What we need is for government to work smarter, better, and more effectively while challenging the American people to think about the opportunities space offers. We have some ideas in this regard.

First, AIA continues to lead the charge to support our commercial space industry by pushing for a fully functioning Export-Import Bank of the United States. Now I know, the Bank is not usually a hot topic at this symposium, but consider this: Four years ago, American exporters of satellites and launch servicers utilized the Bank’s export credit services to support nearly a billion dollars in sales to foreign customers. But since 2015 the Bank has been treated as a political football, and lacking a full board of directors, it can’t provide loans and guarantees greater than $10 million, an amount so low, it renders most of these kinds of sales impossible. Losing the Bank’s ability to support large sales has impacted the entire space industry, from suppliers and satellite builders to launch providers.

What we need is the U.S. Senate to vote in the four Ex-Im Board nominees that have been approved by committee and for the Administration to nominate a true leader for the Bank, someone who believes in its mission and the opportunities that exports provide.

Another impediment to American satellite and launch vehicle exports are restrictions set by an international agreement, the Missile Technology Control Regime, which need updating. Concluded at a time when commercial space applications hadn’t yet fully developed, the MTCR restricts the export of commercial space systems that could advance both science and cooperative ties between nations. We’re working with the administration to engage the international community to modernize the MTCR language and align U.S. export control policy to take full advantage of such change.

And finally, we have the good fortune to represent an industry that excites and motivates young people to dream bigger, beyond the limits of our planet. Perhaps it’s the challenge of working on cutting-edge technologies that offer the potential to reshape our society that is so tempting to budding young geniuses. Or, it could just be that the hardware sells itself, from supersonic airplanes and interplanetary capsules, to rocket engines and space stations. Whatever the case, the broad appeal of our industry enables us to constantly inspire generations of young Americans who will become tomorrow’s space workforce.

I’ll close by mentioning that next year AIA will be celebrating our 100th anniversary, and of course the nation will mark the 50th year since Apollo 11 – the first moon landing. These events must not only be occasions for fond nostalgia, but rather opportunities for our industry to chart its vision for the future. By strengthening and sustaining our dynamic commercial, civil and national security space sectors today, I’m confident that 50 years from now, the young people attending this symposium will have a universe of possibilities ahead of them. Thank you for the opportunity to speak today.