A Washington brawl has broken out over the future of the U.S. military's ability to reach orbit, with the powerhouse combo of Boeing and Lockheed Martin jostling with the scrappy — yet well-funded — upstart of entrepreneur Elon Musk’s SpaceX for multibillion-dollar contracts for launching satellites.

The competition is upending the norms of the defense contractor heavyweights, who are not used to dealing with relatively fresh rivals, and has released a flood of lobbying cash. SpaceX has spent more than $1.3 million on lobbying this year and while the Boeing-Lockheed joint effort, called United Launch Alliance, spent more than $900,000 — both on pace to easily set new records for the companies once the final quarter of 2015 is reported.


It’s also spawned a proxy war in the Senate. Before Congress left town for the holidays, Boeing-Lockheed ally Sen. Richard Shelby (R-Ala.) slipped language into the massive $1.1 trillion spending bill overturning restrictions on ULA's ability to use Russian-made engines to power its rockets — and thus, U.S. military satellites — into orbit.

The move sparked a furious response from McCain (R-Ariz.), a SpaceX backer and sponsor of the original engine restrictions, who slammed Shelby for choosing "to reward [Russian President] Vladimir Putin and his cronies with a windfall of hundreds of millions of dollars." The Senate Armed Services chairman threatened to ratchet up the limitations placed on the Russian engines to a "complete and indefinite restriction."

And this is all before the real showdown starts next year.

The Defense Department is expected to award contracts for at least four satellite launches next year, marking the first time ULA and SpaceX compete head-to-head for the Pentagon business.

The outcome of these awards is expected to play a major role in the future of U.S. space flight, as the Air Force's lucrative contracts for launching satellites are a core business for ULA and a key growth area for SpaceX and Musk's star-based ambitions.

ULA had a monopoly on military space launches since its creation in 2006. But earlier this year, SpaceX was certified by the Air Force to compete, following a 2014 lawsuit against the military service that ultimately was settled. SpaceX recently logged a big win, successfully landing earlier this month a rocket after launching a satellite into orbit.

Complicating matters is the U.S. military space program’s current dependence on Russian-made engines. Until a U.S. alternative engine is developed — which isn't expected until at least 2019, and possibly years later — the use of Russian engines will keep the program subject to the ups and downs of U.S.-Russian relations.

"As long as there's a delicate relationship ... the engine program becomes a slave to that," said Marco Caceres, director of space studies at the Teal Group, an aerospace consulting firm. "So it's a very uncertain program to say the least, as long as the relationship is uncertain."

In the meantime, there is a small army on both sides of ex-lawmakers, congressional aides and administration officials-for-hire seeking to sway Congress and the Pentagon to one side.

ULA hired four outside lobbying firms in 2014 and added another lobbyist, former State Department official Theodore Kronmiller, in July. The company's lobbying lieutenants include former Rep. Bud Cramer (D-Ala.), and several former House and Senate Appropriations Committee staffers now with Van Scoyoc Associates.

SpaceX may be the upstart in the rocket business, but it has heavy hitters fighting the lobbying battle, including former Senate Majority Leader Trent Lott (R-Miss.), former Sen. Jon Breaux (D-La.), Heather Podesta and longtime defense lobbyist Michael Herson.

Multiple SpaceX and ULA lobbyists contacted by POLITICO either declined to speak on the record or did not respond.

SpaceX declined to comment. A ULA spokeswoman said the company commended the Appropriations Committee "for ensuring this nation's assured access to space for its most critical national security satellites."

SpaceX argues that its Falcon 9 rocket is cheaper than ULA's Atlas V and Delta IV. Musk's company has seen some setbacks — a Falcon 9 sending supplies to the International Space Station blew up earlier this year. But it also landed its rocket booster back at Cape Canaveral on Monday, a feat that could have major implications for driving down the cost of commercial launches.

ULA, meanwhile, points to its track record of successful military launches as it works to drive down its costs. The company is moving away from its more expensive Delta IV rocket, and it hopes to shift from the Atlas rocket to a new launch vehicle, the Vulcan, which would replace the Russian RD-180 engine with the new U.S.-made alternative.

An American-made engine is still in the early stages of development. While the project received $228 million in the omnibus spending bill, a boost of $144 million, Air Force officials have warned that Congress' 2019 deadline to move off the RD-180 could create a multiyear gap before a new engine is certified.

The issue came to a head last month when ULA chose not to bid for the first competitive launch in the Evolved Expendable Launch Vehicle program. ULA said it did not have any engines for the competition because the five it was granted in last year's defense authorization bill were already committed to other launches.

The company's backers argue that SpaceX is trying to create its own monopoly by grounding ULA's Atlas V rocket using the Russian rocket argument and forcing it out of the competition.

"Recklessly restricting the use of the RD-180 in the near-term will undermine both national security and the prospects for real competition in the military launch business," Shelby wrote in an op-ed.

ULA's critics in Congress counter that not bidding was a political ploy — a trap, if you will — that paved the way for Shelby's language in the omnibus. They say that ULA could have used the Russian engines for the military launches if it wanted to.

"Instead of setting those engines aside for national security launches, ULA rushed to assign them to non-national security launches that are unrestricted in their use of Russian engines," McCain wrote in a letter to Defense Secretary Ash Carter. "ULA's use of these tactics is unacceptable. It artificially created a need for relief from legislative restrictions on its ability to continue using RD-180."

