马斯克承诺研发完全可复用火箭 2011

0:01Well, thank you for having me. It's really an honor to speak here for the National Press Club. So I have an exciting announcement with respect to space. And I think one which should be provide some inspiration and some belief that the innovation is alive and well in America and going in really interesting directions.

0:29But before I, I'm gonna get to that, but I'm gonna preface that with the logic that explains why such a thing is important, because it may not be immediately obvious. So first of all, going back to why am I in space and electric cars and solar power and internet stuff, It goes back to when I was in college, and I was trying to think of what were the most important things that would affect the future of humanity?

1:04What could have a significant positive effect in the future of humanity? And the three things that I came up with were the internet, sustainable energy, both production and consumption, and then space exploration, but specifically making life multi-planetary. And I didn't expect, when I was in college, to actually be involved in all three of those areas.

1:26But as a result of some success in the internet arena, that gave me the capital to get involved in very high capital endeavors, like cars and rockets, which we really are, very high capital. So the reason for, I'm mostly going to talk about space. So I want to explain why do I think space is really important

1:57and what about space? And because I believe in building things up from a rational framework of logic. And so you saw it was how do you decide that anything is important? And I think the lens of history is a helpful guide here in that things that may seem important in the moment,

2:24but actually aren't that important in the grand scheme. Over time, if you look at things over a broad span of time, the things that are less important kind of fall away. And if you look at things from the broadest possible span of time as it relates to life itself, and the evolution of life has been, primitive life, I think, started around 3.5 to 3.8 billion years ago. And what are the important steps in the evolution of life? And obviously there

2:53was the advent of single-celled life. There was differentiation to plants and animals. There was life going from the oceans to land. There was mammals, consciousness. And I would argue also on that scale should fit life becoming multi-planetary. And in fact, I think consciousness,

3:15It's the next step actually because you really kind of need consciousness to design vehicles that can transport life over hundreds of millions of miles of irradiated space to an environment that they did not evolve to exist in. It would be very convenient of course if there was another planet just like Earth nearby.

3:39But that's unlikely and as it turns out not the case. So I think you couldn't really, there's no way for life to just buy a dint of natural selection, just sort of get over to Mars and survive. So you need consciousness, you go to design. So I think it is the next natural step. So I think if one could make a reasonable argument that something is important enough to fit

4:10on the scale of evolution, then it's important. And maybe worth a little bit of our resources. And one can also think of it from the standpoint of life insurance. There's some chance, either as a result of something humanity does, or as a result of something natural like a giant

4:39asteroid hitting us or something. That civilization, life as we know it, could be destroyed. There's clear evidence for life being destroyed multiple times in the fossil record. So we don't need to guess that this is something that can occur. It has occurred. And the Permian extinction being a particularly interesting one because I think that destroyed somewhere

5:04between 90 and 95% of all species on Earth, which doesn't tell the full story because most of the remaining species were fungi. So unless you're in my room, you're out of luck. So if we think it's worth buying life insurance on an individual level, or perhaps it's worth spending more than spending something on life insurance for life as we know it.

5:33And arguably that expenditure should be greater than zero. So then we can just get to the question of what is an appropriate expenditure for life insurance? And I think probably if it's something like a quarter of a percent of the GDP, that would be okay. I think most people would say, okay, that's not too bad.

5:59But you know, you don't want it to be some sort of number that is much less than we spend on healthcare, but maybe more than we spend on lipstick, you know, something like that. And I like lipstick, so I'm like, I've got anything against it. So yeah, I can't wait for that comment to go out there.

6:27So that's kind of the thing that I think it's important that we give a little bit of our our mind space towards. And I think it's also one of the most inspiring and interesting things that we could try to do. It's one of the greatest adventures that humanity could ever embark upon.

6:46And life has to be more than about solving problems. If all that life is about is solving problems, why are they getting up in the morning? There have to be things that inspire you that make you proud to be a member of humanity. And, you know, the Apollo program is certainly an example of that.

7:08It's only a handful of people went to the moon. And yet, actually, we all went to the moon. We went with them vicariously. We shared in that adventure. I don't think anyone would say that that was a bad idea. That was great. So, you know, we need more of those things. At least we need some of those things.

7:35And even if someone's in a completely different industry and in a completely different walk of life, it's still something that's going to make you feel good about the world. And that's another reason why I think we should try to do these great things. So now, then let's get to the question of, well,

7:57how do you make life multi-planetary? What are the fundamental obstacles to that? Because it's all well and good if everyone agrees that that's worth doing, but if we can't do it, well, it doesn't matter. So the pivotal breakthrough that's necessary, that some company has come up with to make life multi-planetary is a fully and rapidly reusable

8:24orbit-class rocket. This is a very difficult thing to do because we live on a planet where that is just barely possible. If gravity were a little lower, it would be easy. If it was a little higher, it would be impossible. So even for an expendable launch vehicle, where you don't attempt any recovery, a lot of smart people have done their best to optimize the weight of the vehicle and the efficiency of the engines and the guidance system, everything, you get maybe 2% to 3% of your liftoff weight to orbit. That's not a lot of room for error. So if your rocket ends up being just

9:03a little bit heavier, you get nothing to orbit. And this is why only a few countries have ever reached orbit. Now I say, okay, well let's make it reusable, which means you've got to strengthen the stages. You've got to add a lot of weight, a lot of thermal protection. You've got to do a lot of things that add weight to that vehicle and still have a useful payload

9:28to orbit. This is nice of that meager 2 to 3 percent, and maybe if you're really good, get it to 4. You've got to add all that's necessary to bring the rocket stages back to the launch pad and be able to refly them and still have useful payload to orbit. So a very difficult thing. This has been attempted many times in the past and generally what's happened

9:50is when people have concluded that success was not one of the possible outcomes, then that the project's been abandoned. Well, in some government projects kept going, even when success was not one of the possible outcomes, unfortunately. But then eventually they get cancelled. So it's just a very tough engineering problem. And it wasn't something that I thought,

10:17I wasn't sure it could be solved for a while. But then I think just so relatively recently, probably in the last 12 months or so, I've come to conclusion that it can be solved. And I think SpaceX is going to try to do it. Now we could fail. I'm not saying we're a certain of success here, but we're going to try to do it.

10:43And we have a design that, on paper during the calculations, doing the simulations, it does work. And now we need to make sure that those simulations and reality agree, because generally when they don't, reality wins. So that's to be determined. And the simulation that you may have seen in the lobby coming in,

11:12which will be posted to our website right around now, is it will show you a simulation of what we plan to do. Now that simulation is mostly accurate, but there are a few areas which are inaccurate. In some cases, just due to timing constraints, we weren't able to work with the simulation people

11:35to get it completely accurate. In some cases, we're keeping a few technical things under our hat. But it gives you a pretty good idea of what we intend to do, which is to land basically for the first stage, after stage separation, turn the stage around, re-light the engines, boost back to the launch pad, and land purposefully on landing legs.

12:00And then with the upper stage, after dropping off the satellite or Dragon spacecraft, then do a deorbit burn, re-enter. You need quite a powerful heat shield. Steer, aerodynamically, back to the launch pad. You don't actually need wings, by the way. This is a coin misperception to steer aerodynamically.

12:19You just need some lift over drag number and lift vector. And at Steervex launch pad, then land propulsively with the upper stage, also with landing gear. And so we'll see if this works. but it's going to be certainly an exciting journey. And if it does work, it'll be pretty huge.

12:43Because if you look at, say, the cost of our Falcon 9 rocket, which is quite a big rocket, it's about a million pounds of thrust, and it is the lowest cost rocket in the world. But even so, it's about $50 to $60 million. But the cost of the fuel and oxygen and so forth is only about $200,000.

13:08So obviously, if we can reuse the rocket, say, 1,000 times, then that would make the capital cost of the rocket per launch only about $50,000. There'd be maintenance and other things that would factor in their fixed costs and some overhead allocation or whatnot. But it would allow for about 100-fold reduction in launch costs.

13:32And this is a pretty obvious thing, think about it as applied to any other mode of transport. You can imagine that if planes were not reusable, very few people would fly. You know, 747 is about $300 million. You'd need two of them for a round trip. And yet I don't think anyone here has paid half a billion dollars to fly.

13:57And the reason is because those planes can be used tens of thousands of times. And so all you're really paying for is fuel and pilot costs and, you know, just sort of incidences. And the capital cost is relatively small. So that's why it's such a giant difference. I thought of another way.

14:18I mentioned that, you know, we could probably afford a quarter of a percent of our GDP for making life multi-planetary. That's the cost if you have a fully reusable rocket. the cost if you don't have a fully reasonable rocket on the same barometer would be 100% of the GDP. And that would mean no money for food, health care or anything else. And

14:41obviously that's impossible. So that's why I think a fully and rapidly reusable system is fundamentally required for lack of become multi-planetary for us to establish life on Mars is the only realistic option for another planet. Venus being too hot, Mercury being way too hot, Jupiter being a gas giant.

15:08And the moons of Jupiter are a possibility, but it's much further out and it's hotter in a lot of different ways. And the moon is sort of too small and resource poor to make life multi-planetary, emphasized, not just to have a little base. A little base is not that interesting, but the self-sustaining human civilization is that

15:29that's on multiple planets, that where life could continue even in the event of a climate you know that is the real thing. Yeah, so I think this is pretty exciting and I think everyone in America and arguably and breast the world should be pretty fired up about what we're doing and hopefully wish us well.

15:56And we'll do our best to succeed in this regard. And yeah, it's definitely going to be an adventure. And I'll say one final thing, which is that sometimes people say, So what is the business model for Mars? And sometimes they think, well, can you mind Mars and bring things back?

16:23And that is not a realistic business model for Mars, because it's always going to be far cheaper to mind things on Earth than Mars. But I do think that there's a business model where if you can reduce the cost of a flight to Mars, or moving to Mars, to around the cost of middle-class home in California, which

16:46just seemed to be rising over time, maybe not recently, but certainly pretty expensive. So maybe to around half a million dollars. Then I think you'd have enough people who would buy a ticket and move to Mars to be part of creating a new planet and be part of the founding team of a new civilization.

17:09You don't have to be willing to have quite an appetite for risk and an adventure. But there's 7 billion people on Earth now. There'll be probably 8 billion by the midpoint of the century. So even if 1 in a million people decided to do that, that's still 8,000 people. And I think probably more than 1 in a million people will decide to do that.

17:37So that's what I think is sort of the Mars business model if you will. And then ultimately, Mars can probably export intellectual property like software and inventions and things like that. If you can sort of beam it back with photons, that's sort of a better way to go. All right, so I'm happy to answer any questions.

17:56Thank you very much. Well thank you very much, obviously given the diverse nature of your own interests and pursuits. you to stay here as soon as you grab a drink of water, which is required on Earth. If you went to the moon, that might be more difficult. So we're going to start with the space piece,

18:23and if you'll just stand up here right by my side, and we'll just sort of wing it one by one. Talk about how you see the practical application of this technology that you just described, sort of in the near and intermediate term, if it's successful. Well, in the near term, the technology will be applied to launching satellites and to

18:47resplaying the space station, taking COVID and crew up there. That's the near term thing and that's what SpaceX's current business is predicated on. We are doing okay in that regard. We've got about $3 billion of revenue in a contract. That's better than okay. Yeah, that's just $3 billion.

19:04Yeah. I mean, it's spread out over the next five years. So it's not all at once, unfortunately. And we do have to do lots of things to get that money. But that's not bad. And so we have been profitable for the last four years, not hugely profitable, but moderately profitable. And we expect to be the same this year.

19:29And I think that's somewhat necessary, because obviously if the amount of money going out exceeds the amount of money coming in, then sooner or later we'll die. So we have to make sure that we have more money coming in than going out. But that seems to be going with me well. And you described to me earlier that right now you're the leading, essentially, vendor

19:48for launching satellites into space right now? Well, if measured by launch contracts awarded, that is correct. And so the United States has been uncompetitive in the international launch market for a long time and Russia has actually been the leader in that regard, followed by Europe and then

20:11to a lesser degree India and China, although China is growing rapidly. And except in the last few years where the United States has done the best and that's entirely to SpaceX. So obviously your person very interested in performing in innovation and that's something that seems the United States does well.

20:33In the space business specifically, how can we maintain that competitive edge and are we maintaining it in the sector generally within our nation right now? Well, as far as launch is concerned, I think it's fair to say that the United States has by far the most competitive launch capability with SpaceX, as a result of SpaceX.

21:00And the only realistic potential competitor is China. I tell you, it's not the easiest thing competing with national governments, which are heavily subsidized. And they certainly have set their sights on us and have told us that. But that's okay. I think we'll win. But we have actually, with respect to China, we have a conscious strategy of filing the absolute minimum number of patents.

21:28We filed very few patents. And the rockets, we were very careful about cyber security, and we're very careful about physical security, because there's obviously a history of absconding with intellectual property in China. And the enforceability of patents against Chinese government is zero.

21:49So that's a contrast that to Tesla, where Tesla files a lot of patents, because competitors are commercial companies, and there was an impossibility. So not to worry about launch, we'll take care of that. Let me come back around a little bit to maintaining the national standard.

22:08As you know, there's been an active debate in Congress. We're in Washington about what is the appropriate role for government. Of course, there was a different approach to that in times where cash was more flush. And it seems to some degree or a great degree, you're a beneficiary of that in the sense that we're outsourcing some of this within our own country now.

22:32Is the inability, the apparent inability of the federal government to spend on this going to be an inherent problem for our country? Well, would you spend a fair bit on space, much more than any other country from a government standpoint. So I think it's what will continue to be the biggest vendor on space

22:53in the United States. But by the same time, I think the budgets in absolute terms will decrease just because of overall compression on the federal budget. And we have a huge budget crisis. And largely have our head in the sand and ignoring the reality that we're spending far more than we're bringing in.

23:18And that chicken will come out to roost. I think we can expect massive compression of all budgets, including space from a government standpoint, just because we simply don't have any other choice. Well, I want to get more to the SpaceX piece, but since you just now talked about sort of the way that you should do business as a government, there's obviously a political issue right

23:40now that's out there about how, what is the appropriate role of government in encouraging job creation? You have 1,500 employees at SpaceX. You're having those jobs in the United States. I guess you have a launch facility in the Marshall Islands. Yeah, well, actually our primary launch facility is Cape Canaveral.

23:59And then we're building a launch site at Vanderbilt Games Force Base in California. We're not currently using the Marshall Islands launch site. We did use it initially. But the logistics are just too difficult getting out there. Because it's like water world out there. It's a trillion miles from anywhere.

24:17So it's convenient in some ways, but then inconvenient from logistics standpoint. So our primary role society is Cape Canaveral and then Bannerburg and then we're also planning on establishing a commercial launch site which would, because I think that makes sense because Bannerburg and the Cape are actually F-force bases and it makes sense to sort of concentrate F-force and perhaps NASA business on those two facilities and then concentrate commercial launch activity at a commercial launch site just as it occurs with aviation.

24:48So what's your sense, as in the political debate here in Washington, do you have trouble creating jobs within your company because of the way the federal government is operating currently or what you envision as the way the policy is managed generally? Well there are, I should first of all say that, you know, SpaceX would not be where it is

25:12without the help of NASA. historically the great things that NASA has done and currently with the business that NASA gives us and the expert advice and everything. So I should make sure to very strongly credit NASA in this arena in terms of how helpful they've been. We do have a bit of a challenge with the Air Force and this is something where I'm sort

25:40of surprise that there's not more journalistic interest because the Air Force is currently proposing to extend the sole source monopoly of Boeing and Lockheed until 2018. And the reasoning given for that is preservation of the industrial base. Although for some reason, I don't know if we're not included in the industrial base.

26:07And this is doubly odd because the main rocket used by Boeing and Lockheed is the Apple Five, which has a Russian main engine and a center airframe, the interstage and a forward airframe, the ferry, which made in Switzerland. So which industrial base are we talking about preserving?

26:24The one in Russia? That doesn't make much sense. So you sense that's a political problem? You know, we have 1% of the loving power of Boeing and Lockheed. That's a political problem. If this decision is made as a function of loving power, we are screwed. I think you just earned a holistic attention.

26:50Well, let's get a little bit more to the space business here, because we do have a lot of questions and I want to be fair to our audience to get in as many of those questions as time permits. Obviously, these are some far-flung questions, literally as well as figuratively. Someone asks, what will today's announcement, how will today's announcement, divert resources

27:09from sending humans to the International Space Station, then I would probably add if at all. No, I wouldn't consider this to be in any way a diversion. This is a parallel effort. And so it's not really impacting our sending of cargo to the space station, nor is it affecting our human space

27:29light development activities that we're doing in partnership with NASA, which is going really well. So think of this as sort of a parallel thing. It doesn't really affect the ascent phase of the vehicle, but we're really trying to have the descent phase not be hit sat in a sphere and explodes.

27:52That's actually what happens to all rockets, otherwise. That's a good goal to keep. Given the grounding of Russia's rocket fleet, are you in discussions with NASA to accelerate launch dates for the International Space Station missions? And what happens when it happens with your scheduled November launch with the possibility that the ISS may need to be evacuated?

28:12Yeah, and with the Soyuz fairly that I could recently, it actually likely resulted in a delay in our launch to the space station because it sort of pushes out the other missions. And NASA rightly wants to have the appropriate level of astronaut, the right astronauts, and a number of astronauts with the right training, everything onboard the space station when we arrive.

28:40So it looks like things will be more like January for the launch of the space station. And that is contingent upon the Russians meeting the schedule that they're currently stated. So how do you evaluate the fact that we're using Russia as an important partner in our space program right now?

29:03How do you feel about that? What are the risks and what are the benefits? Well, I think despite the recent failure of the Soyuz, it is actually a good vehicle. It is a good track record. I think there may be some concerns going through the future long term with Russia in that a lot of their expert rocket engineers have retired because it's much more compelling

29:28financially to go into the oil and gas industry in Russia than it is to go into the rocket industry. So that expertise is tailing off and I think that may lead to decreased reliability for four Russian rockets in the future. Hopefully it doesn't. Does that give the advantage to China then?

29:50Well, I think long term, like you said, I think China is the serious competitor long term. If you look at Russian rocketry, since the fall of the Soviet Union, there's really been no significant developments. The technology has barely progressed. No new rockets have launched since the fall of the Soviet Union.

30:12So, so obviously what that means is As soon as that technology levels exceed it, then they're branded redundant, and they have no ability to compete. And I think that's likely what will occur with the Russian launch industry. So how much longer do they have, unless they start doing some serious work as being a viable space program there?

30:33Five to ten years. And how soon does that mean that at that point, China moves in? I mean, essentially in that space that they're occupying? I'm quite confident we can take on China. Yes. Well, let's get to another question. I'm a big fan of a conflict, but I'd rather be honest than tryin'.

30:51Well, you're on the record and I think you have a lot of people cheering for you. So, obviously we'll see what happens. We'll invite you back. Ha ha ha. Check back. Exactly. Could be famous last words. Given the failed progress launch and the risk of trusting the very survival of the International Space Station entirely to soil use for years to come,

31:10there's something of a state of emergency until U.S. crews begin. Can you fast track development and human rating to result in crude launches beginning in about two years? And if not, can you speed up the process by any amount? Could you launch in an emergency? Yeah, well, I think here it's important to clarify

31:30What can the system do that we've done? The Falcon and Dragon system that we're launching today, what what can it do? If the The degree of safety required was equivalent to that of the shuttle. We could actually launch astronauts on the next flight, on the one going up in, which were likely to go up in January.

31:51The system is fully capable of carrying biological cargo, which is people. So however, what it doesn't have is a launch escape system. And this shuttle also does not have a launch escape system. And both NASA and we agree that a launch escape system is a wise move. So we are, it will take us about two years, maybe at the outside three to develop and qualify

32:23the launch escape system. And the way we're doing a launch escape system is, I think, a significant innovation beyond what's done in the past where the escape thrusters are both into the side wall of the spacecraft. So you can actually use those same thrusters for propulsive landing, which is cool. And we're actually talking with NASA about potentially doing missions to Mars and other

32:50places using Dragon as kind of a general test, a general science delivery platform to various places in the solar system. So so that's an important distinction. We could launch We could launch satellites next flight if requirements seem as shuttle, but for everyone that's added, the launch escape system, two or three years.

33:17Questioner asks, NASA has a legacy of openness and transparency unlike private companies would. While you're flying private payloads, a private model will continue to work for you. However, once the American taxpayer starts footing the bill, I guess the supposition is here more aggressively.

33:33assurances can you give that SpaceX will be as open and transparent as NASA and other aerospace systems or need you be? Well you know relatively speaking a pretty open transparent company. Now there are some restrictions here which are ITAR restrictions and they're not restrictions that you know we have any choice of because advanced rocket technologies considered protected

33:58technology so you can do harm with those. Right, right. We can't sort of just publish the general public detailed, detailed analysis of failure investigations that contain secrets on how to make rockets. That's actually a violation of the law. But all that information is available to NASA and to the FAA.

34:23So our, you know, for missions that we do for NASA, NASA has quite a detailed oversight role. the FAA as well has an oversight role. So, you know, if you're comfortable flying commercial aircraft, I mean, you should be pretty comfortable with what we're doing in commercial rocketry.

34:41And yet with NASA, there's obviously any number of tragic events that occurred where human life was lost. And in the sense that, obviously, they're using private companies as partners, but essentially it was under the NASA and government brand. essentially flying the American flag.

35:01Can a company like yours sustain a loss like that as a private enterprise? Would people be willing to give you as much, dare I say, space in the event of a tragedy that they would be their own government? Yeah, I think that'll be okay. I mean, if you look at all other modes of transport, aircraft, boats, cars,

35:24see, familiar with cars, There's loss of life in every mode of transport. And if one set a standard that you couldn't have loss of life and there would be no transport, you wouldn't even be allowed to walk. So you have to allow for some amount of risk. It needs to be reasonable and measured, but you have to allow for that.

35:52But I don't think that a commercial company, I think Kumash Company, arguably, would be better able to deal with that than a govern entity, because with the government, then you have the congressional hearings, and it tends to become sometimes political football. So Congress has a willingness to investigate private companies as well.

36:13Oh, sure. Yeah, yeah. But I think that certainly occurs where it seems like there's been sort of in a violation of the rules or something like that. but something's within the rules. I mean, they're obviously they're fatal car accidents every day, but you don't get a congressional hearing on it.

36:29I'm trying to think. No, I think you're right. Let me follow up then. Someone asked, if you took NASA out of the equation, in the sense of being responsible or important for your future business, is there enough private satellite and other government payload business to keep you going if, for some reason, NASA wasn't in the picture?

36:46Or is that a concern at all? Yeah, well, certainly NASA is our largest customer and most important customer, but if you look at our launch manifest, we have over 30 Falcon 9 missions on the contract. 13 of those are with NASA. So effectively we've got maybe about 40% of our business

37:10with the government, but then if you consider, let's say you made pencils, well, about 40% of your business would be with the government. So it's not unreasonable number. Fair enough. Fair enough. Here, we're getting to the workforce issue. Someone writes in the audience today, my son, not me, is a mission controller at Houston's Johnson Space Center, which obviously is relevant to the future of your business as well.

37:40Many of his friends with the shuttle program have been let go and are interviewing via video for jobs with your company. any suggestions on what you're looking for? Sure. Well, if you look at the amount of money that is allocated to commercial space relative to the overall NASA budget, you'll see it's a pretty small number.

38:09Sort of last fiscal year, it was about $300 million, but that was split over four companies. So we got about 75, I think, or something like that. So that's, I guess, about half a percent of the NASA budget. So it's important to bear in mind that we'd love to hire a lot more people that are currently hired, but we can't also run out of money and die.

38:32So we can only hire a few people. In terms of what characteristics we look for, we generally are quite engineering centric. So we're big fans of what have people done from a hardcore engineering standpoint. Yeah, what tough engineering problems have they solved, how they solve them?

38:58And we're sort of less interested if it's sort of been a more of a paper oriented role that they've had, because we try to minimize that at SpaceX. So are you more demanding an employer than NASA would have been? Well, that's a tough question to answer. Give it a shot. I think we're probably more demanding.

39:24I mean, I guess NASA's a large organization. So I think the level of demand that people face in different parts of NASA varies considerably. And I'm sure that there are parts of NASA where we're just demanding, maybe more demanding than SpaceX. But SpaceX is an extremely demanding organization and we expect people to work super hard and be very good at their job.

39:50Given the Tesla and Solar City, are your response in a sense, among other things, to climate change, how do you answer politicians who say that they're not sure it's actually happening? Okay, well, I think, you know, I think the climate debate is an interesting one. So if you ask any scientist, are you sure that human activity

40:21is causing global warming? Any scientist should say no, because you cannot be sure. So on the other hand, if you said, do you think we should put an arbitrary number of trillions of tons of CO2 into the atmosphere and just keep doing it until something bad happens, they'll probably say no too.

40:44We essentially are running an experiment and that experiment is to test the carbon capacity of the oceans in atmosphere. Now that experiment may turn out to be fine. It may also turn out to be really bad. And I just don't understand why we'd run that experiment. Particularly when you consider that at some point we have to get to something that is sustainable.

41:10We have to have sustainable production of energy and consumption of energy because tautologically if it's unsustainable you will run out of it. And you can simply say, well, let's say hypothetically CO2 was good for the environment. And let's say hypothetically, the United States possessed all the oil in the world.

41:34Well you'd still have to get off oil because it's a finite resource. And as you start to run out of it, the scarcity would drive the cost up and cause economic collapse. So why not do it sooner? And I'm not saying that it needs to be a radical or immediate change, although people need

41:52to now inject a great deal of misery into their lives, to avoid CO2. But we should lean in that direction. We should lean in the direction of supporting technologies that are sustainable and lean slightly against technologies that are unsustainable. That just seems pretty sensible, even if the environment

42:17isn't a factor. And in fact, my interest in electric vehicles predates the current climate issue. I mean, I was interested in electric vehicles 20 years ago where nobody was really talking about global warming, because I just thought it was the obvious means of transport. But I do think the climate thing does add urgency to things.

42:41And I do think we will see quite a significant increase in the cost of oil. Just from a demographic standpoint, You've got China and India and a few other countries that represent almost half the world's population and have very few cars in the road, but are rapidly adding costs to the road.

42:58So you can expect a doubling of demand and I think it's going to be difficult to achieve a doubling of supply. Have you changed anything in the wake of the federal cylinder investigation and do you have any concerns about an inquiry into government loans and contracts? Tesla's DOE loan application stand up under such scrutiny.

43:20Yeah, I mean, so in the case of Slender, you know, Slender's obviously become somewhat

43:32of a political football here, speaking of footballs earlier. The DOE programs, they're necessarily our portfolio of programs where some number of of the things that have funded there are going to fail. That should be assumed. It should not assume that 100% success. And in the case of Slendra, people forget that private investors lost twice as much as the government did.

44:02And there was some really first rate venture capitalists in Slendra. It's known as though these were suckers. So if you've got first rate venture capitalists who've lost twice as much money as a federal government, you have to say, okay, you know, I mean, it was a bet. The bet didn't work, but that doesn't mean it's, you know, it's something some really

44:26terrible happened. I mean, the most you could say is that Slender executives were too optimistic. You know, they presented a better face to the situation than should have been presented in the final few months. But then if they didn't do that, it would have become a self-fulfilling prophecy of, you

44:47know, as soon as the CEO says, I'm not sure whether we'll survive, you're dead. So, you know, I think people are making too much of the cylinder thing. And I mean, and do I think the parallels with Tesla? I mean, we got a loan from the DOE from a different program, I should point out.

45:07But in our case, we have significant capital reserves, and we have more money at Tesla than we need to complete the program in question. And we don't face the same issue that Slindra faced, which is extreme competition from China on a commodity product that drove the cost per watt of solar panels from $4 a watt down

45:31to $1. That's the fundamental reason why Slender went down, is Slender would have been, okay, at $2 a watt, but not one. And that's it. And here's the other thing, which is not getting a fresh, which is how much money do you think the Chinese government's putting into solar? Estimates are about $40 billion, okay?

45:56So we've got our team with operating on a pittance. You got China operating on 40 billion and our team lost. That should be no surprise. Do you worry that that's tarnished? The view of the American public of the solar industry in the United States? There's probably a little bit of tarnish, but it's unwarranted tarnish.

46:25It's a solar city. Now, the scenario that occurred with the cost for what if Solar was something that I thought I expected would occur. So somebody had asked me, do you think Solar is the best but I would have said, no, you're going to get your ass kicked. But so Solar City works on balance system, where they do everything except the panel.

46:48And they own the end customer relationship. They kind of like Dell or Apple. Dell or Apple don't make the CPU or the memory or the hard drives, but they design the overall system, and they provide it to customers through the sales marketing service and that's what SolarCity did. SolarCity is doing super well and they're growing at 50-100%

47:09a year with positive cash flow which is pretty incredible. I just showed with warm meetings he had good news, it's really great. We're all credit to those guys. For them the more And for them, the more rapacious the competition on solar panels, the better. It helps you. Yeah. Well, if you wouldn't mind, we'll do some finishing business here.

47:37So if I can just step up there for a second, then we'll get a couple more questions in if you'll just stand by. So as many of you know, we're almost out of time. And before asking the last question of the day, a couple of housekeeping matters to take care of. And first among those is just reminding you about some immediately upcoming luncheons.

47:54Burns, the document, Terrian, filmmaker will be here on Monday to talk about his new film Prohibition on October 5th. Ron Paul, candidate for the GOP presidential nomination. That's the 5th of October and that event is sold out. We just announced October 24th, TMZ's Harvey Levin will talk about the changing landscape and entertainment news. So before I get to

48:17the last question, if you'll just come right over here, we present our speakers on a routine basis with our token of our appreciation and thank you very much our National Festival of Coffee Mug. Thank you. Thank you, Elon. So we'll see if we have time for more than one question here at the end, but these are on the lighter side, as many of you know in the audience. Let me ask you first of all, what's the one great idea that you've seen

48:47from somebody else and as the slogan goes, I could have had a V8. Why didn't I think of that? There's probably been more than one, but which of those loom largest in your mind? and please stand up to the microphone. A great idea that you saw someone else had, and you wished you had had it yourself, or expressed that idea.

49:04Well, there's lots of great ideas that people come up with all the time. I don't necessarily wish I'd had them myself, but certainly what Larry and Sergey came up with, with Google was really smart, with the backward links to pages. Obviously, what Facebook has done, Twitter, I mean, there are great examples in the internet.

49:32And yeah, those are American companies. Yeah, I've had, obviously, iPhone. I think Apple, Google, Facebook, I mean, these are the examples where it's like, you're sort of like, who's there a competition? You're not even sure. OK. How is it that America is able to innovate so well given all the challenges when we have

50:00great companies like that performing so well? In many ways the nation continues to be a great innovator. How do you explain that? How does that continue to happen? Why is that? Well, it's kind of like the statement about democracy. It's a bad system, but it's the least bad. Well, the United States is the least bad at encouraging innovation.

50:26And then Silicon Valley, actually, I'd say is particularly good at encouraging innovation. But Silicon Valley is just orders of magnitude better than any other place in the world for creating new companies and fostering innovations. It's quite remarkable. So I don't think we need initially to worry about some other country out there out innovating us.

50:52I don't think we've been purized, like almost all innovation in the world comes from America. It's like, yeah, it's true. I mean, a ridiculous percentage. But that doesn't mean it couldn't be better. And I think we need to be concerned about, excess regulation, a tax structure that potentially doesn't promote innovation.

51:17Because you think to remember is like when companies are little, they're like tadpoles. I mean, they just die very easily. And so you need to have an environment which tries to protect little companies and help them get bigger. And Silicon Valley does that very well in America. In general, does that very well relative to other countries?

51:39But most other countries tend to foster and protect, or other where they tend to protect the big companies. Big companies don't need protection. Very well, please. How about a round of applause for our guest speaker today? Thank you to all of you for coming today. We'd like to thank the National Press Club staff, including our Library and Broadcast Center, for organizing today's event.

52:06And you can find more information about the National Press Club on our website. You can get a copy of the program. Please check that out at www.press.org. Thank you, and we're adjourned. It was great meeting you. It was great meeting you. Absolutely. Thanks so much. . . . . . . . . .