The other day, somebody posted a pointer to an article about the investor
that purchased MIR. Having read the article, I believe it warrants posting
in its entirety.
--Lucky Green <[EMAIL PROTECTED]>
"Anytime you decrypt: that's against the law".
Jack Valenti, President, Motion Picture Association of America in
a sworn deposition, 2000-06-06
----8<----8<----8<----8<----
The New York Times
July 23, 2000, Sunday, Late Edition - Final
SECTION: Section 6; Page 37; Column 1; Magazine Desk
LENGTH: 4387 words
HEADLINE: American Megamillionaire Gets Russki Space Heap!
BYLINE: By Elizabeth Weil; Elizabeth Weil is working on a book about the
Roton
rocket.
BODY:
This is a story about wealth and space and America and Russia, and it
begins with one man, Walter Anderson -- a man with white hair and pale
skin, square, gold-rimmed glasses and a physical presence so profoundly
unprepossessing it's almost impossible to remember what he looks like.
Anderson is 46 and worth almost a billion dollars. He lives in Washington
-- the city he grew up in, a city he hates; his hatred of the government
is, as he puts it, "personal" -- in an apartment adorned with a painting
he commissioned based on a Smashing Pumpkins lyric, "I am still just a rat
in a cage." "That's what we are," Anderson explains, "rats in a cage. And
we're going to gnaw through the bars because we've got about a 30-year
window here, and we'll starve if we don't get out." The cage Anderson
refers to is the planet earth itself, and he has taken it upon himself to
ensure we get off. In 1989, Anderson gave $80,000 to finance the
International Space University; in 1991, $100,000 to found the Space
Frontier Foundation; in 1994, $5 million to start the Foundation for the
International Nongovernmental Development of Space; and between 1996 and
1999, $40 million to build the Roton, a manned, reusable spaceship. Then a
few months ago, in one of his eriodic calls to me, he rang me up: "I'm in
Russia!" Anderson was midway through three days of talks with Yuri
Semyonov, president of the private Russian space corporation Energia, and
in a move that would later marginalize NASA from the
Anderson-Russia-America love triangle, he was arranging for a new company,
called MirCorp, to lease the space station Mir.
It was not an act of open defiance. In most ways it was an act of
trust, devotion and faith. Anderson had been dreaming of leaving Earth
since he was a little boy. He wired the Russians $7 million before he even
signed Mir's lease. Anderson put up $31 million toward the lease, which
will eventually cost $200 million a year. It will give MirCorp the rights
to Mir for the remainder of its lifetime, the use of two or three manned
Soyuz rockets annually, as well as two or three unmanned Progress rockets,
the exclusive control over Mir's visitors and technologies, 40 days of
active operation and the privilege of fixing Mir up. All of this has put
Anderson more cozily into bed financially with Energia, thereby creating a
situation highly threatening to NASA. The American space agency, after
all, was already embroiled with the Russians in the way-over-schedule,
way-over-budget, politically Pollyanna-ish International Space Station, a
project that was announced 17 years ago under President Ronald Reagan,
that had already incurred several Congressional hearings and that space
patriots in Washington were determined to make "the only space in space."
Specifically, at the time Anderson leased Mir, NASA was blaming the
Russians for being two years behind in launching the service module, or
living quarters, for the International Space Station. (It was finally
launched on July 11.) Worse, rumor had it among space experts that NASA
could not technically complete the International Space Station without
Russian help. And many inside the agency feared that the Russians would
lose interest in the International Space Station altogether if they kept
their own space station up.
A less brusque man than Anderson might have chosen to sweet-talk and
pacify the NASA brass out of their TKTK. But Anderson, arrogant in such
matters, is, as he terms himself, an anarcho-capitalist. He flies around
the world in his private jet pledging allegiance first and foremost to the
laws of GATT. Thus instead of calling NASA, Anderson called his friend
Chirinjeev "Baboo" Kathuria, a 35-year-old megamillionaire Sikh. Kathuria
told Anderson that he, too, was "interested" in Mir, which in
megamillionaire-speak meant he was willing to chip in $4 million, to form
MirCorp, and start upending last century's notions of relations in space.
On a Friday evening late in March, Anderson and I sit on the dully
plush mezzanine of the American Hotel in Amsterdam, prepping for the
coffeehouses, where Anderson likes to smoke and cavort with disaffected
world youth. I first met Anderson two years ago while researching a book
on the Roton spacecraft. Among his first words to me were, "Please don't
make me famous." But by the spring of the year 2000, he has invited me to
interview him over the course of a weekend in Holland, the Tuesday after
which he'll launch the world's first privately financed manned mission off
Earth. The following Thursday the two professional Russian cosmonauts he
has hired will enter Mir to see if it can be repaired.
Already I know that MirCorp is registered in Bermuda, run out of
Amsterdam and structured as a 40-60 partnership with the space corporation
Energia (38 percent of which is owned by the Russian government). I know
Anderson's plans include rehabbing the station and expanding its volume to
9 or 10 times its present size. I know he wants to sell joy rides on Mir
to wealthy individuals (Dennis Tito, a 59-year-old money manager and
former rocket engineer, is the first to sign on, planning to spend 10 days
on Mir sometime early next year) and advertising on Mir to commercial
companies ("we'll paint it up like a Nascar"). Anderson expects to offer
access to Mir equipment to corporations and governments and to sell
intellectual rights on Mir's considerable patents so that, as Anderson
puts it optimistically, "NASA won't be able to build so much as an air
lock without paying MirCorp something first." Eventually he intends to
move into even more dubious but potentially lucrative markets, like
in-orbit satellite assembly and satellite repair. I do not know if
Anderson's vision amounts to a dream or a pipe dream, a gift or a curse.
For certain, he harbors a taste for grand, most likely fantastical,
visions. Once at a space conference he'd underwritten, Anderson told me he
believed that more than half the American space shuttle missions carry
classified cargo. "If I discover dirty satellites, nuclear wearpons in
orbit," he then said with a giddy grin, "am I going to pretend they're not
there? No."
Anderson is loose-limbed and gangly, with an oddly unused-looking body.
He favors black jeans, casual short-sleeve shirts, suede sport coats and
slippers. Ever distrustful of his fellow men, he zealously guards his
personal privacy; his name is not on the marquis of his office in
Washington, and neither are the names of his companies. If you take the
elevator to the fifth floor, none of the people milling around the
cubicles will have any idea who he is. In the alternative space
underground, which Anderson has bankrolled pretty much singlehandedly,
he's known for being dystopic, generous, ruthless, overimpassioned,
incisive, philanthropic, libertarian and shy -- by those who know him at
all.
Now, in Amsterdam, as he uncomfortably shifts his weight on a stiff
leather couch, he informs me, blunt as ever, that he'd rather not talk
about his personal history, that his professional history should suffice.
Namely, that in 1979 he was one of the first 300 employees at MCI; that in
1984, he founded Mid Atlantic Telecom, a regional long-distance carrier,
the first to integrate phone and voicemail service; and that 10 years
later, he started Esprit Telecom Group, cracking into the newly regulated
European market. That same year he used $6.2 million from the sale of
MidAtlantic to seed a Bahamas-based holding company called Gold & Appel,
named after the Golden Apple, the second volume in the 1970's,
sex-and-conspiracy-theory cult pulp trilogy, "The Illuminatus! Trilogy."
He has more or less doubled his capital every year since. In 1998,
Anderson sold Esprit for $1 billion in stock and assumed debt. He presumed
he'd need all that money to build rockets and space colonies.
"Now with this Mir thing," Anderson says, tapping the tips of his
fingers together, "if it works, it's such a nice shortcut."
I ask if it won't make NASA extremely nervous -- a lone, superwealthy
uber-citizen challenging its authority and dominance in space?
Anderson slips on his suede jacket -- apparently we're to head out to
the clubs. "In my life," he says, his eyes lighting up like a teenager's,
"if the U.S. government doesn't try to kill me, I probably won't have
succeeded in meeting my long-term goals."
Among spacers -- the polite name for space obsessives -- such
sentiments are not uncommon. Anderson was 4 when Sputnik flew, 15 when
Neil Armstrong first stepped on the moon, 19 when Eugene Cernan left the
last moon-dusted boot mark. And he still seems not to have fully recovered
from the magic of those memories, from the implicit, now-broken promise
that someday soon we will all be living in the heavens, shouldering power
packs and wearing jumpsuits in a better, higher, lighter world. Anderson's
space talk is still infused with statements that sound vaguely like
clubhouse rules. ("I'm not saying it's fair, but I've been thinking a lot
about human rights in space, and in my space station, people would all be
peaceful or I'd throw them out the air lock.") His peers include men with
Ph.D.'s from M.I.T. who have a hard time holding down jobs. One in
particular, a man obsessed with the "Star Trek" -like "Babylon 5" remains
haunted by a grandmother who shushed him to sleep early on the night of
the Apollo 17 landing, telling him he had school tomorrow, and, anyway,
we'd be landing on the moon every day when he grew up. Other spacers
gather for dinner in Beverly Hills annually on June 20, the anniversary of
the first moon landing. For their ritual meal, they borrow the form of the
Passover Seder, only instead of commemorating the Jews fleeing the bonds
of slavery in ancient Egypt, they celebrate human beings escaping the
bonds of gravity here on Earth.
A few hours later, in the basement of a cramped milk bar called
Bulldog, Anderson sets into exalting his latest love interest: the
14-year-old, 130-ton, third-generation Soviet space station Mir, designed
to orbit only five years, now spinning almost a decade beyond its expected
life. The station suffers many nicknames -- the porcupine, the dragonfly
-- most referring to its ungainly assortment of modules and solar arrays.
Inside, it's sorely in need of remodeling. For the past 10 years, the
station has been beset by significant money problems. As early as 1992,
top Russian officials were comparing their own space program to a chicken:
"You cut off its head, and it runs around the yard for a while thinking
it's still alive." Then, in the late 1990's, Mir suffered a string of
high-profile, high-altitude disasters -- a collision, a fire, several
massive computer shutdowns -- troubles so vast and so economically
intimidating that Energia's president, Semyonov, decided to deorbit his
outpost and call his final crew in. NASA, ever covetous of Russian
resources for the International Space Station, waxed ecstatic. That is,
until in a move that the chairman of the House Science Committee would
call "a real kick in the jaw," Anderson flew in his jet to Moscow to meet
with Semyonov, playing the board game Risk on the way. Among the first
things Anderson said to Semyonov was, "I don't necessarily agree with the
views of my government." Walt hunches his shoulders, looks thrilled.
"Isn't that crazy?," he asks.
Anderson's first foray into the commercial space sector proved a huge
debacle. He financed the development and construction of what he hoped
would be the first generation of privately financed manned space
transports: the Roton rocket, a vehicle initially conceived to be 65 feet
tall and shaped like an upturned egg. When complete, the Roton was to be
the world's first single-stage-to-orbit, fully reusable rocket. But when
the project ended, Anderson had instead spent $40 million on the oddest,
tallest helicopter on earth. In its last flight test, the Roton flew 1,400
yards down a runway in Mojave, Calif., at a speed of 53 miles per hour and
an altitude of 75 feet.
Anderson's second foray, MirCorp, seems to be going better, thanks
largely to his decision to handle MirCorp "like a business," something
almost all other private space companies neglect to do. (Anderson's Roton
has at least half a dozen rivals, but the dreaminess required to attempt
space travel without military-industrial backing, and the discipline
required to pull it off, appear to be intrinsically at odds.) To make
MirCorp run efficiently, Anderson joined forces with a newcomer to the
space world, his fellow telecom tycoon Baboo Kathuria, who, when I meet
him the next day at noon for a cheeseburger lunch, is wearing a bright red
turban and goofy print shirt. Kathuria has just flown in from Chicago,
where he has been staying with his parents, sleeping in the same bed he
slept in as a teenage boy. His eyes are so wide they're almost round. His
long beard is tacked to his chin with bobby pins.
As he picks through his fries, Kathuria starts to giggle, his voice
growing high and airy and soft. "Mir is definitely a real business," he
says, "definitely undervalued," and "definitely cool." By his own
estimation, cooler than his turban and his beard. Also much cooler than
anything in the telecom business, which he fell into when he had a crush
on the heiress to a Filipino telecom fortune and tried to impress her by
privatizing India's phones.
Despite, or perhaps because of, their business successes, neither
Anderson nor Kathuria seems to have much lasting luck with women. Ever
reticent about personal matters, Anderson insists he's "just having too
much fun" and isn't "mature enough yet to marry." Kathuria, however, the
consummate sidekick, desperately wants to discuss his problems with girls.
The situation has grown kind of dire in that he's already too old to
advertise for an arranged marriage in the Indian newspapers: Sikh tycoon
with lease on Mir seeks to marry same? After lunch -- in the brief window
before Kathuria will ingest his second cheeseburger of the day, this one
with Anderson at Burger King, over which the two men will commit to invest
in Mir another 10 million bucks -- Kathuria and I walk along the canals to
the Van Gogh Museum, and Kathuria tells me about the time he sat in a limo
outside the Miss Universe contest in Trinidad with Donald Trump, who was
making out with a 23-year-old woman, and Evander Holyfield, who wanted to
borrow Kathuria's "hat." In the galleries, he explains that his mother has
been hinting that he should get married. The sound of his cell phone
ringing, the sound of his bachelor life, is beginning to drive her nuts.
As for Anderson, he finally allows his patina to crack just slightly on
our last night in Amsterdam. We're sitting at a hipster bar with no name
on the front -Anderson, uncharacteristically, wearing a flashy,
star-speckled blue silk shirt -- when, in his own bellicose way, he
decides to open up. He begins with a rather jaundiced prelude, calling
Donald Trump "a weenie," claiming Trump doesn't even own his buildings and
that he'd be a richer man today if he'd just left his daddy's money in the
bank. Next Anderson insists that he could be as famous as Trump or Richard
Branson if he only hired bodyguards and a New York P.R. firm. Then, once
that's aired, Anderson settles down. Amid the house music and velour, he
admits he feels "lucky to have the space thing right now" because it's
"kind of important and challenging," and it saves him from "all the
pretentious bull that rich people get involved in," and from "flying
around on the plane, getting very depressed." He also reveals that when he
was a child his father worked for the top-secret National Security Agency,
and that he hasn't spoken to his father in 25 years. He will not discuss
what, if anything, any of this has to do with leasing a space station.
In the morning Kathuria and I will fly to Moscow for MirCorp's first
launch. If the launch succeeds, and if the subsequent docking succeeds,
Anderson will be the first private citizen to send two men into space. If
the launch fails, or if the docking fails, this hotheaded recluse, this
financial angel in a star-speckled shirt, will be the first private
citizen to send two cosmonauts to their graves.
Moscow, early April, is gray and in a state of flux, with the new Ikea
out by the airport and the new mall under the Kremlin, with the spring
warmth turning the vast landscape to mud and the articles, daily, in the
papers about what kind of leader Putin will be. According to the Russian
philosopher Grigori Pomerants, his country has slipped into "a state of
mass disorientation" since the collapse of the Soviet empire. MirCorp's
presence here, surely, does not help. Anderson's company comes with its
fat wallets, its precocious grandmasters of capitalism, buying at deep
discount the detritus of the space race, the Soviet Union, the cold war.
On the surface, the situation sounds like the setup for a joke: So
there's a Sikh and an anarcho-capitalist and they want to buy a space
station* . Underneath, the situation is equally gonzo. After arriving in
Moscow, Kathuria and I drive to the nearby factory town of Korolev, where
we will watch, via monitor, the launch of the cosmonaut-carrying Soyuz
rocket and then, two days, later the docking of that rocket to Mir.
Anderson is not with us -- he had wanted to fly to the Kazakhstan launch
site to witness the liftoff itself, but the Russian government refused to
give him clearance because of the war in Chechnya. So he flew from
Amsterdam to France.
The launch goes off without a hitch. Kathuria spends 48 hours muttering
repeatedly and almost semiconsciously, "This is definitely not telecom,
definitely not for the faint of heart." Meanwhile, he negotiates with
Energia in Energia's austere, heatless "international building" -- a
square, pale, brick box with no front door, no lobby, no ornamentation --
an international building only possible to design if the architect never
imagined foreign guests. Not so long ago, these same rooms housed debates
about missile capability and Iron Curtain strategy so geopolitically
intense that they sent schoolchildren across America scurrying under their
desks during bomb drills. These days, agenda items include wiring Mir as
an Internet portal and co-producing a prime-time television show, a sort
of "Who Wants to Go to Outer Space?," to run for one season, following a
dozen or so hopefuls through cosmonaut training, one being eliminated each
week.
Had Anderson not amassed nearly a billion-dollar fortune from an
offshore holding company or had he not nurtured a libertarian obsession
with government evil, you might wonder if he knows what he is doing. But
Anderson, a 21st-century antihero, clearly knows how to manipulate
economic arrangements to produce the effects he wants. Thus you have to
assume it's by design that the Russians sound swoony and triumphant about
the MirCorp deal ("Investment not so good from their part," a chief
Energia officer gloats, suggesting he outmaneuvered Anderson) while Daniel
Goldin, the NASA administrator, sounds defensive, embarrassed and left
out. "My feelings are bruised. I have a hurt," Goldin uncorks in a
particularly effusive moment from his office in Washington. "I'm not
saying MirCorp shouldn't have done what they did. I'm just saying I'm in
the book, they've got my number and it might have been nice if they
called."
Goldin, who speaks in a thick Brooklyn accent, sounds conflicted and
disrespected, like a sidelined mafioso. Conflicted because, theoretically
at least, he favors space commercialization. "Competition is great!" rings
one of his mantras. Under Goldin's watch, NASA has contracted out some $3
billion annually with fledgling space businesses (Anderson refused to
accept such funds on the Roton project, and he would refuse to accept them
for Mir).
At the same time, however, his lumbering bureaucracy has burned
through, almost literally, some $60 billion on the International Space
Station. In 1999, NASA suffered one of its worst years ever, losing two
robotic Mars landers. Newt Gingrich credited Goldin with making "space as
boring as possible." The Economist magazine dubbed the International Space
Station "the black hole in the sky." Thus Goldin is sincere in saying, "If
MirCorp can finance Mir and get an unsubsidized positive cash flow, I
think that's fabulous!" He is also deeply humiliated to have to explain to
Congress why (a) he lacks the clout to force the Russians to abandon Mir
and meet their International Space Station milestones, and (b) a certain
international financier is able to negotiate far better prices with the
Russians than he is.
"I'm not saying that money is being diverted," Goldin protests,
intimating that the Russians may be siphoning money from the International
Space Station and dumping them into Mir. "I'm just saying the arithmetic
doesn't add up. I read in the papers that private United States investors
paid $20 million for six weeks of operation of the Mir space station, a
Soyuz vehicle, a Progress vehicle. They got the operations center. They
got the training. And now I understand they're going to get another flight
up there? The Russians charged us, last year" -- on an International Space
Station-related matter -- $65 million for one Soyuz vehicle! $135 million
for two! I'm just saying that it's frustrating, year after year, when the
Russian government doesn't give us any vehicles to work with. So like I
said, I have some bruised feelings. And the arithmetic! I'm confused."
In Korolev, the morning of the docking, television crews trail muddy
tracks as they push through the command-and-control center's drab marble
foyer. Everyone's in a hurry -- who are these rich investors? -- and no
one is wiping his feet. Upstairs, the control room proper resembles an
aging 1950's college lecture hall -- rows of concentric half-circles, a
projection screen up front. Old men fill the back landing, clasping hands
and taking pictures. The engineers and cosmonauts of years past are on
hand: Boris Chertok, 89 years old, who commanded the first space docking
ever; Sergei Krikalev, still young and mustached, who in 1991 orbited
overhead in Mir while the Soviet Union dissolved below, asking, "Is it
true that Russia is going to sell the Mir space station, together with
us?" All have seen communism, perestroika and failed capitalism; all
regard Anderson's impassioned, impertinent largess with irresolute, blank
stares.
Nearly 200 miles above it all, two men careering at 18,000 miles an
hour are trying to catch a decrepit space station doing the same. Below,
we watch, onscreen, the spinning earth captured in the cross hairs of the
docking portal. The image is haunting -- it speaks of power -- and causes
you to wonder where Anderson is right now. Presumably he's making money on
phones in France. Or perhaps he's in Spain, pursuing another of his
far-out ventures, like the thermo-protected rocket-powered space
skydivingsuit a friend of his is trying to build. (Anderson hopes to take
dives from Mir.) It's hard to say. In part because nobody has a cell-phone
number that works for him in Europe. In part because Anderson's cleft
personality is hard to resolve. The devil in Anderson, it seems, is trying
to get back at his father's government. Still, his spacefaring impulse
seems to come from a pure, even childlike, place.
Fortunately, the docking itself provides only minor excitement -- a
bounce off the portal, a switch from automatic to manual, before the
cosmonauts finally lock in. But immediately afterwards Semyonov treats the
crowd of old-timers and reporters to one of the boldest gestures in the
history of human space flight: he officially hands Mir's reins to MirCorp.
Everyone laughs aloud with Semyonov at the indignities of age and the
perpetual rise of the young. Not heard, however, are the inward nervous
twitters, for this is a transition not simply from one generation to the
next or from one political philosophy to another, but from a world order
based on governments to one based on wealth, from an old-school Soviet
comrade to an anarchic supercitizen, a man who feels himself alienated
from his family, his peers, his country, his planet; a man who, because of
a certain facility for making money, has the power to effect relations on
a geopolitical scale.
The effects of such a new world order, if in fact it comes to pass,
will not be known for quite some time. Meanwhile, in the coming months,
MirCorp will send Dennis Tito, its first "citizen-explorer," into orbit.
Energia will provide Tito with rocket transportation and cosmonaut
training, while NASA, on the sidelines, will continue feeling bruised and
hurt, continue its public kvetching, continue exerting pressure on Putin
to dump his old bag into the sea. (Goldin recently offered the Russian
$100 million in space contracts, contingent on deorbiting Mir.) The Mir
love triangle is inherently unstable, as love triangles always are.
Anderson and Semyonov jilted Uncle Sam.
Shortly after the docking, Kathuria, as Anderson's proxy, finds himself
enveloped in a pack of elder Energia statesmen and, to consummate their
union, is shepherded into the control room built for the International
Space Station. There, among never-used consoles and shrink-wrapped chairs,
everyone eats smoked salmon and caviar and hoists shots of Standard vodka.
Everyone watches as MirCorp's cosmonauts float through Mir's hatch, unfurl
the blue-and-white MirCorp sign and thank MirCorp very much. Semyonov
toasts his new sugar daddies -- the people who trusted us" -- and rebuffs
his old flame, NASA: "You closed the door on us, you slime. You closed the
door in our face." Anderson's absence feels enigmatic, awkward. I do not
speak to him for almost a week. And when I do, he offers only a single
word, a simple, affectless adjective, to describe how he feels about his
new space liaison, how he feels about sending two cosmonauts to orbit,
challenging Russian-America relations and perhaps challenging relations
between governments and their wealthiest citizens for quite some time.
That word deciphers nothing of his personal and political motives. He
says, plainly and abstrusely, that he's "happy."
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