Jason Snell

Kimbal Musk explains United States Government wants to pay $1 billion dollars per rocket launch SpaceX came along and said no, the price is way lower at only $50 million US Government pushed back and wanted the cost $1 billion dollars per launch “Government would say, "But we'll pay you $1 billion. We just want you to do it our way." No, but that's the wrong way. You have to do it this way. It's $50 million. We were very happy with that price. The government was like, "No, we don't want that." And we actually couldn't believe it. We're like, "But you must want it for a lower price." Actually, they didn't care that much about price.” Basically it works like this Old defense contractors can spend as much as they want and the government will pay that amount plus 10%. That means they have an incentive to make the launches as expensive as possible SpaceX said here’s a fixed price of $50 million and if we can do it cheaper then we can keep the extra money This is a much better incentive system because it saves taxpayers a huge amount of money and SpaceX gets rewarded for making launches cheaper