Part 2: The Office of Commercial Space Transportation–Pre FAA
The Various Attempts to Transform OCST
Even as Bob Fairman and I told J. Lynn Helms that the space program would stay in OST only until it became an operational organization, we knew that the program should never go to FAA. This became even truer after Secretary Dole and Secretary Baldridge met with President Reagan to discuss each Department’s approach to fostering the commercial space industry. According to anecdotes at the time, President Reagan was inclined to give the role to Commerce, but Commerce would not agree to share any role with DOT. In the final analysis, Elizabeth Dole’s assurance that DOT would use a light touch persuaded Reagan to select DOT as the lead agency. As long as the space program stayed out of FAA, Elizabeth Dole’s commitment could be honored. However, FAA was a strong Agency with an even stronger regulatory culture.
If the program ever moved to FAA, the days that the industry could count on an enlightened regulator were numbered. After all, Tony Broderick, the FAA Associate Administrator for Regulation and Certification had personally told me he was going to eliminate the failures in rocket launches via strict regulations. Tony was a friend and his comment was made in a serious, factual, non-threatening way, but it exemplified FAA culture.
I had several goals. One was to fend off any take over attempts. Another was to build up OCST as much as possible so if it did become part of FAA it would have its own culture, technical capability, and knowledge to withstand FAA pressures. Finally, my greatest goal was to develop OCST to the point that it could be separated from OST and established as a separate, independent Operating Administration within DOT.
The First FAA Takeover Attempt. Surprisingly enough, the first attempt did not take place under J. Lynn Helms. Helms ran into issues shortly after Bob Fairman talked to him, and left the FAA. Instead, the first attempt in 1987 or 1988, came from a FAA Administrator who had had a lot of experience with OCST– T. Allan McArtor.
McArtor had been the chair of a space advisory group that Jenna Dorn had established, the Commercial Space Transportation Advisory Committee (COMSTAC). When Donald Engen left the FAA as Administrator, the Secretary of Transportation needed a new nominee, and because Jenna Dorn (Elizabeth Dole’s former Special Assistant) and Elizabeth Dole had had experience with McArtor who was a senior executive with Federal Express, they nominated T. Allan McArtor to be the new FAA Administrator. Joining him was my closest colleague, Michael Goldfarb, who had been a partner in many different initiatives, including identifying Courtney Stadd as a candidate for OCST Director to replace a departing Director. My guess is that somewhere in discussions between McArtor and Michael Goldfarb, the thought occurred to them that since they had been heavily involved in OCST earlier, it would be a good idea to bring it over with them to FAA. Michael and I had been extremely close colleagues while he was in OCST, so I wasn’t surprised when I heard through the grapevine that a “takeover” attempt was in the works. Michael had even suggested to me that I could come over to FAA with the office.
The way the takeover attempt would have started was that either the FAA Administrator or some other FAA principal, such as Michael Goldfarb, would have started discussions with some senior official within OST who felt that having an “operational” program in OST was wrong. That FAA official would also have emphasized the similarity between the two functions, arguing that it didn’t make sense for OCST to be separate from FAA. That official might have even pointed out that it probably was difficult for OST to support the commercial space function and that FAA was much better equipped to handle the function. At the same time, it is important to recognize that there were probably some organizations that were resentful of OCST being in the Office of the Secretary. Congress was continually harping on the Secretary of Transportation about the large size of the organization, and OMB likes to control things by limiting organizational growth. Thus, the presence of OCST in the Office of the Secretary probably meant that other offices were getting squeezed as we grew larger in size. In the final analysis, it probably wasn’t hard to find some friendly ears receptive to the idea that OCST should be moved to FAA.
Michael was a good enough maneuverer for this attempt to have worked, except for one thing. It was too close to the point in time that we, DOT, had had to fight to get the lead agency role. It wasn’t too hard for Courtney Stadd and me to build a backfire defense against the FAA takeover attempt. We simply had to re-energize all those links and parties who had been involved in the hard work of recovering the lead agency role from Commerce. In very short order, the institutional powers of the Office of the Secretary were taking action to ensure that OCST didn’t move anywhere.
The First Effort to Create a New Agency, the “Space Transportation Bureau”. By 1988 the Office of Commercial Space Transportation had all the characteristics of an independent agency except for critical mass. We had enabling legislation, an industry, regulatory authority, and we had a political constituency. Courtney Stadd had built the Office into a mini-space agency in terms of government influence. We just were small.
In the history of DOT up to that point, there had been no “line” functions in the Office of the Secretary, so there was a natural predilection to “do something with the Office.” That was our vulnerability. We had just successfully fended off a FAA attempt to get us transferred to that Agency. My belief was that it was possible to get the Department to consider making us a separate organization. The thought was not too far fetched. Organizations had already been broken off in DOT and others had been consolidated as well. However, the compelling case for making OCST an Agency was that the Office Director was dealing with the Administrator of NASA, and the Secretary of the US Air Force on an equal standing. In addition, OCST was making major space policy, and steering a national priority industry.
I had been involved in enough Departmental initiatives to know the key issues that needed to be addressed. The greatest issue was not the size of OCST, but instead the fact that OCST had no internal administrative support. If we were proposing to become an Operating Administration and wanted our own administrative group (i.e. personnel office, budgeting, procurement, etc.) then that meant a large increase in resources. Instead, we proposed that the Office would rely on OST for administrative support. I prepared a memorandum for Courtney laying out the case for the creation of a separate Operating Administration.
We sent the proposal to Jon Seymour, the then Assistant Secretary for Administration, and Wayne Vance, the General Counsel. Those two offices reviewed the proposal and forwarded it to the Deputy Secretary, Jim Burnley, for consideration. Courtney Stadd met with Jim Burnley and talked at length about the long-term importance of this step. The Deputy Secretary did not dispute the need, nor the desirability of taking this step. However, it was August 1988, an election year, and within four months the transition to a new administration, Republican or Democrat, would begin.
As is so often the case at this stage of the election process, Jim Burnley decided not to act on the proposal stating that he did not want to anticipate a decision that should rightfully belong to his successor. It was understandable because had there been a change in party control of the White House, everything done at the last moment in DOT would have been undone. Plus, even had there not been a change in party leadership, the new Secretary might have his/her own ideas about space. However, the greatest risk would have been if we had not tried.
Second FAA Attempt to Take Over OCST. I don’t remember which FAA Administrator made the second attempt to take over OCST; it probably was Admiral Busey. Again, the grapevine said that there was a FAA takeover attempt in the works. By this time, the Office had been in existence for several years. I had kept up my relationships with different OST organizations, and we still had the current administration willing to say that FAA was not good for the nascent industry. Stephanie Lee Miller was the Director at the time. Stephanie was an extremely astute politician. Furthermore, there were many senior officials in the Office of the Secretary who remembered that DOT only got the space role because we agreed not to put the responsibility into FAA. We both worked our connections to block the FAA attempt. We were successful once again in staying out of the FAA grasp.
Second Attempt to Create a Space Agency: the Federal Space Administration. Stephanie Lee-Miller succeeded Courtney Stadd as the OCST Director. She had been a former Assistant Secretary for Public Affairs in the Department of Health and Human Services. She built on the platform created by Courtney and elevated OCST’s role in the space community even further, and she increased the Office’s credibility within DOT. The Office had doubled yet again in size and its budget had tripled. Once again, we prepared the case she wanted to make. Her proposal was that the Office of Commercial Space Transportation be reestablished as a separate Agency, the Federal Space Administration or Bureau. Here are some excerpts from Stephanie Lee-Miller’s memorandum to the Secretary of Transportation:
- “In the space arena, DOT is one of the big three Federal decisionmakers: NASA, Airforce, and DOT…DOT (is) now responsible for overseeing more launches than NASA.”
- “…In fact, in the three policy sessions held to date with the Vice President, commercial issues largely dominated.”
- “$2.5 Billion worth of satellites are now scheduled for launch by companies which are subject to DOT’s regulatory authority.”
- “OCST is an operating agency that develops safety regulations, issues operating licenses and approvals, and conducts an active inspection and enforcement program.”
- “DOT’s legal regulatory influence over space exceeds that of NASA or DOD. For example, DOT—not NASA or DOD—sets the insurance requirements which protect Cape Canaveral and the Kennedy Space Center. Similarly, DOT is recognized as the only agency with regulatory control over space debris issues in the commercial space transportation environment”.
Merging the space program with another Agency, such as FAA, her memorandum went on to say, “…would be viewed by the Administration, Congress and space constituency as a major reduction in Secretarial priority”.
We didn’t get the Agency status this time either. However, the Department’s recognition of the growing importance of the function was manifested in a number of ways. The Secretary elevated the Associate Director for Licensing Programs (my position at the time) to a Senior Executive Service (SES) level. Although her proposal called for the Associate Director for Industry Policy and Planning and the Program Counsel (legal counsel) to also be SES the latter two were not approved. The Secretary approved other changes that brought OCST closer to being a new, separate organization, but not the major step of establishing it as a separate Agency.
The Office of Commercial Space Transportation Gets Transferred to FAA. In 1992, Bill Clinton and Al Gore were elected to the White House, which meant that the “old guard” and all the political institutional memory left DOT. The Office of Commercial Space Transportation went almost 9 months under the new administration without political leadership; in September 1993, Frank Weaver was appointed as Director. It was clear that after having served five Republican appointees in a row a transition might be challenging for me. By this time I a lot of battle scars from pushing NASA and USAF on launch range use, insurance, and the many other issues found on this site. Some had told me I was sometimes called the “real Mr. Commercial Space”, not a good title to have in a political world. It wasn’t a good sign when Frank told me he thought I was “incapable of carrying out the Clinton-Gore agenda” (his exact words). He “elevated” me to Senior Advisor, essentially taking me out of the loop in OCST operations, policy, and direction. By late 1994, it was clearly time to seek new adventures.
After much networking, I received a call from Vice President Gore’s Task Force on Reinventing Government (aka National Performance Review) for an interview. In January 1995, I went to work as a team leader for NPR under Bob Stone and Elaine Kamarck and worked with the top cabinet officials of the Clinton-Gore administration in coming up with change strategies. Later, after the “Contract with America,” a new Congress was elected, and the job turned to finding large funding cuts to match those proposed by Congress. In this latter role, an Office of Management and Budget associate director and I would work with select cabinet officials to identify programs for specific budget cuts. The two of us would send Vice President a memorandum under our signature for his approval with the proposed cuts; there would be a meeting of the principles, and recommendations implemented. In than 6 months we achieved $17 billion in budget reductions. At the conclusion of that endeaver I became the project director for the Vice President’s book, Common Sense Government. So much for not being able to carry out the Clinton-Gore agenda.
By then the chances of keeping OCST out of FAA were lost. No one in the Office, outside of Carl Rappaport, had the memory of the fight DOT had gone through to get the lead agency role and the fact that DOT had said it would keep the function out of FAA. Nor did the incoming political appointees have any previous experience with that battle. There was no reason for them to think there was any problem with the FAA. All the reasons to keep it separate got lost with the change in administrations.
When an office like OCST gets to be as large, influential, and budget-demanding in the Office of the Secretary, the institutional imperative for the career OST staff is to push it out of the Office of the Secretary. Furthermore, creating a new administration and adding to the Secretary’s span of control, also runs against the OST careerists’ grain (to which as a former OST decisionmaker, I could attest); OCST had become a beast. So OCST encountered the “perfect storm”. I was already working on the Vice President’s project, the political experience in DOT had left, and the institution went on auto-pilot to kick OCST out of OST. And probably, FAA exhibited a great interest in the function.
I don’t know whether Frank Weaver tried to fight the transfer or not. He was inexperienced at bureaucratic infighting, and at the time I left, he had shown little interest in the regulatory program. Unlike Courtney Stadd, he did not carry a lot of weight with the space community; unlike Stephanie Lee-Miller (by that time Stephanie Lee-Meyers) he was a political ultra-lightweight. In the end, it made no difference. OCST was transferred to the place that everyone, just 10 years prior, said it should never go.
Epilogue
There was and is a problem with the Office of Commercial Space Transportation that should be addressed through a dialogue within the Administration, Congress, and industry. The Office is headed by a political appointee. The vision for this Office needs to be set externally, and the person chosen to head the Office has to have the ability and openness to carry that vision forward.
In the larger scheme of things, this Office is no different than any other of the hundreds of organizational entities for which an incoming administration picks a leader. Usually, the appointments are based on the need to find jobs for individuals who worked or played part in a campaign or who have a connection with the administration. This is a perfectly fine process that gives the administration means and control by which to extend its policies into the government bureaucracy. It works generally, but it also assumes that the political appointee is actually in tune with and has the capability to address the needs and intent of the administration. In most cases, this doesn’t make a difference because the appointees move into established organizations and just minor policy tweaks are necessary to re-direct the programs or policies in which the incoming administration has an interest. For the most part, administrations are interested in those agencies or offices continuing what they are doing day to day without interruption.
That probably isn’t true with the Office of Commercial Space Transportation. It needs a consistent, lasting vision that won’t waiver. It needs political heads that understand that vision and carry it through. Even under the first five Directors of OCST for whom I worked and supported, that wasn’t true. Some of the Directors, such as Jenna Dorn and Courtney Stadd, came in with the knowledge, spirit, and capability to move the space program within their own visions. But the three other Directors needed strong support from the staff who also shared the original vision. Stephanie Lee-Miller, a former HHS Assistant Secretary for Public Affairs, knew nothing about space, but she was a quick study and eager to move the program in the direction we pointed. Madeline Johnson and Carol Lane had neither space nor regulatory experience and looked to the staff for the path to follow, but they were in the Office just about a year. The vision or the direction for the program over that 10 year period came either from the Director, or the staff or a combination of both.
Frank Weaver was brought in by an administration that had no specific focus on commercial space. There was no memory of battles fought, lost and won. The administration was unaware of the philosophy or vision that the previous administration held. When Frank Weaver came in, it was a hostile takeover. He came from the industry and had his own goals. He had no interest in the vision of the regulatory program. In fact, his first acts were to remove me and disassemble some of the processes and infrastructure we had put in place. Whatever I created was suspect. I do not fault him for his approach. I have seen many, many transitions and all too often that is the case. The incoming want to make a mark, and one way to do it is to erase the legacy of the previous incumbent. Again, that is part of our political process.
SpaceX’ recent complaint about the regulatory program is a direct consequence of the lack of external vision for OCST and inattentiveness to the selection of its leader. Lack of a national vision for the Office allowed it to be put into the FAA. A lack of understanding resulted in the selection of a Director who had no interest in learning the reason the program was designed the way it was. Furthermore, it resulted in the selection of a new regulatory head who came from NASA and brought the same NASA perspective that resulted in NASA and the USAF setting insurance at $500 million. His successor then came from industry. If SpaceX is seeing too much regulation, it is because, after OCST’s first 10 years, the understanding and vision of what was needed to foster a healthy, vibrant commercial space industry had gotten lost in the transition to FAA. Selection of Directors who followed a path they deemed sound, but without awareness of where that path would take them exacerbated the situation.
If the Nation wants to see the pathway to the stars built faster and more imaginatively, the external awareness of the consequences of wrong steps should be so great that the Office is unable to steer itself in the wrong direction.
Lest anyone think this viewpoint stems from the fact that I was not able to stay as the developer and designer of the OCST regulatory program–a case of “sour grapes”–please look at my bio (click here). My next steps led me to an even greater adventure in the White House and an opportunity to turn around and privatize a major organization in the FAA. It led to the President’s Quality Award and national media touting my experience with the FAA Logistics Center as hard proof of the benefits of privatizing FAA. (Click here: President’s Quality Award; Government Executive; IBM Business of Government; Computer World)
The fact of the matter is that left to the natural government process that lacks any vision, OCST or its successor will evolve in the direction that changing political leaders, ambiguous national policy, and day-to-day events steer it. Left to their own devices, government entities go off in the direction of their own choosing.