AGEE Approval

On February 17. 1976, the 10 members of the Senate Committee on Aeronautical and Space Sciences published its report on the “Aircraft Fuel Efficiency Program.” Frank Moss and Barry Goldwater, the Senators who wrote the original letter to the NASA Administrator about the need for a conservation solution to the aviation fuel crisis a year earlier, led the Committee. NASA’s six-part response, coupled with broad support from industry, made a compelling case for funding the $670-million program, in the Committee’s opinion.

The Moss and Goldwater Senate Committee published several conclu­sions regarding the hearings. Its members stated first that they had learned that fuel efficiency would play a cutting edge role in competing in the world aircraft market. Second, they believed that embarking on a fuel- efficiency program would serve as an important stimulus to the U. S. air­craft industry. The benefits would accrue not only to the traditional aircraft manufacturers and operators, but also to the numerous subcontractors. In 1974, more than half a million people were employed in the aircraft and parts industry. Third, new fuel-efficient aircraft would offer a major assist­ance to the entire air transportation system, which was struggling for prof­itability and survival in the midst of a fuel crisis and escalating oil prices. Although the technologies identified by NASA would not have an imme­diate impact. Moss and Goldwater concluded that “higher fuel costs will remain an urgent program in the foreseeable future… more fuel efficient aircraft will be highly desirable and beneficial to the air transportation system in the next and succeeding decades.”[84]

Fourth, the Committee stressed that the project was important because it involved energy conservation. With the potential to reduce fuel con­sumption by up to 50 percent, its effects would include higher profits and more environmentally friendly technology, which included aircraft noise and pollution reduction. By using less fuel, the market demand for oil would also decrease. Basic economics suggested that a reduction in demand would decrease prices, providing yet another way for airlines to increase profitability. Finally, in an area that was unquantifiable, yet perhaps undeniably the most important of all, the NASA program would strengthen the United States. Decreasing demand for fuel would “reduce the vulnerability of the… Nation to the whims of oil rich nations.”54 The technology could also be adapted by the military, with the Air Force incor­porating fuel-efficient technology to increase the range of its bombers.

One other major conclusion of Moss and Goldwater’s report was that it was the Government’s responsibility to bear the risk and the costs of the technological research and development. There were several reasons for this. First, the Senators acknowledged the “considerable risk” associ­ated with the projects. With the cost to develop a new airplane already at SI billion. Moss and Goldwater said, “it is no mystery why aircraft manufacturers must be conservative in their choice of their technology."[85] [86] [87] Even if industry were to try to develop it. the technology would be propri­etary, and the benefit to the Nation would be significantly reduced. So the Senators concluded that the aircraft fuel-efficiency program was a “classic example” of the need for Government support.

NASA was the appropriate Government Agency to take the lead, thanks to what the Senators recognized as its “long history of excellence.” Although NASA had recently become associated with space explo­ration, they pointed out that “aeronautics is a part of the very name of the agency.”47 Also, very clearly, NASA was not in business to build air­planes—so though it would take the lead in the research, it would also determine the most opportune time to transfer the technology to industry.

Moss and Goldwater carefully took into consideration the criticisms of the program, most specifically those of the Federal Energy Administration. In addressing the first argument, that no one really knew how much fuel savings these program would create, the Senators responded that this was precisely the reason for the research project in the first place —so that NASA could determine w hich projects were feasible. As for whether the airlines would not have the capital to purchase the new technological effi­cient airplanes in 1985. the Senators were confident that the aging air trans­portation system, which would be ready for replacement with some type of aircraft, would offer a fuel-efficient solution to the problem Why would airlines executives purchase the older, less-fuel-efficient aircraft? As to the third argument, the question was: Why focus on aircraft when automobiles consumed so much more fuel? The Senators responded to concerns about the program’s focus on aircraft over automobiles by explaining that no automotive fuel conservation program was being proposed, and that the airline fuel-efficiency program should be judged on its own merits.

The Senators agreed that it was impossible to predict the real indus­try costs for implementing this advanced technology, recognizing that the proposed program’s only established costs were the amounts required for NASA’s research. On the other hand, they argued that there was no indication that the costs would be prohibitive, and the fact that there was broad approval from industry supported this assumption. In rejecting the notion that all costs should be established up front, the Senators wrote, “We believe it would be a mistake to insist that all the costs (or benefits) must be assessed before a decision on the program can be made.” They justified being lax in their demands for financial analysis because of their unquestioned belief in the importance of the fuel-efficient technology. Furthermore, it is almost impossible to perform a cost-benefit analysis on basic research. On this point, they simply responded, “We feel this program has the potential of returning enormous benefits, far in excess of the costs.”

In conclusion, the Senators approved the NASA plan. “On the basis of fuel savings alone,” they wrote, “the aircraft fuel efficiency program is attractive. And considering all the potential benefits and NASA’s man­date to maintain U. S. leadership in aeronautics, the program is essential.”5* With its mandate in place. NASA immediately went to work to put the plan into action and divided responsibility for the six technology initia­tives between two NASA Centers. It would fall upon the shoulders of Lewis Research Center in Ohio and Langley Research Center in Virginia to make these technological dreams a reality.