October 9, 2018 By Joseph P. Farrell

Mr. S.D. spotted this story(for which a big "thank you"), and I have to warn you now, this story is deliberately following yesterday's story about the Chinese hacking, and the geopolitical consequences following therefrom. The hypothesis that I will be advancing is, of course, all high octane speculation.

That speculation concerns the Mouse that Roared (see That's right, the Grand Duchy of Luxembourg is in the space news again, having previously drawn our attention when Elon Musk's Space X launched a military satellite for the Grand Duchy. And that, I averred last February when I blogged about it, meant that Luxembourg intended to become a "space power" or "space player." The question is why is the Grand Duchy of Luxembourg emerging as a "space player"? One can understand France, Germany, China, Russia, India, Japan &c, but Luxembourg? Back in February, I wrote the following about Space X's launch of the satellite, a military surveillance satellite:

My high octane speculation and intuition is that this is a first practical step on the build-out of redundancy into the financial clearing system, but with a unique twist: a surveillance capacity-for-hire comes with it, and this capacity could thus signal that non-territorial actors are being deliberately courted as the "target market" for the capability. Hence, the relationship with Musk's Space X is significant, for it presages more such launches of similar payloads in the future. Indeed, if certain of the satellite's capabilities are "reserved for governments and institions", one wonders exactly what those institutions are: banks, foundations, corporations come to mind, as also more salacious organizations.

In effect, Wibberly's fictitious Cold War scenario of the Mouse that Roared and The Mouse on the Moon is, in a way, becoming reality: Luxembourg means to be a player in the emerging space-based financial, communications, surveillance system.

And that means, more significantly, that Luxembourg will have to develop the means to defend those assets, and that, to my mind, is where those unnamed "institutions" and organizations come in. It will, in short, have to learn how to roar, and to acquire the means to do so.

In that context, consider now the article offered by Mr. S.D.:

Three American space startups to establish offices in Luxembourg

Now consider these details:

Three U.S. companies will set up offices in Luxembourg, the latest sign of an ongoing effort by the small European country to diversify its space economy.

The government of Luxembourg announced Sept. 27 that CubeRover, Hydrosat and Made In Space will all establish facilities in the country, in many cases working with local universities and companies. The work those companies do in Luxembourg will range from development of robotic arms to small planetary rovers.

“The success of our development strategy for the space sector, including the recent launch of the Luxembourg Space Agency, is confirmed once more with the settlement in Luxembourg of three space companies that plan to employ up to 85 people in the Grand-Duchy by 2023,” said Étienne Schneider, deputy prime minister and minister of the economy of the Luxembourg government and the driving force for the country’s recent space initiatives.

The largest agreement, in terms of jobs created, goes to Made In Space. That company, best known for additive manufacturing work on the International Space Station, plans to work on a low-cost modular robotic arm for in-space applications, and will create up to 50 jobs in the country.

“While we believe this product will reduce satellite makers’ barriers to greater capability on orbit, we also see our robotic arms as being integral to constructing space gateways, building lunar habitats and assisting in the in-space construction of future space stations,” said Jason Dunn, the founder of Made In Space, in a statement.

The company said that doing that work in Luxembourg allows it to “effectively partner” with European aerospace companies, although the company did not identify any specific partners.

It's that last sentence, I suspect, that gives away Luxembourg's - and Europe's - game, and that, of course, brings us to today's trademark High Octane Speculation. Luring American companies to the Grand Duchy could, of course, be a way of tying Europe's space industry to the USA in "another tie that binds." But I think not. Consider the recent news: the German finance minister Heiko Maas floated a trial balloon for Europe to create a financial clearing system as an alternative to the American-dominated SWIFT system. This was expanded into a Special Purpose mechanism to continue trade with Iran and by-pass US sanctions. Additionally, lest we forget, the Grand Duchy is Europe's other great international banking center/tax haven, conveniently located between Belgium, France, and Germany. So we have a banking center/tax haven that wants to be a major player in space, via the corporations it lures to Europe and does business with.

Then there's the other story that emerged this week, in my opinion a story that will have massive long-term geopolitical implications, that story being the Chinese hacking of many systems in the West via small computer chips placed in systems sold around the world. That's not just a national security issue for the USA, it's a security issue for Europe and all its component powers and smaller nations with technological capacity and engineering infrastructure (France, Germany, Spain, Italy, the Netherlands, &c). All that carefully built-up space technology infrastructure that the European Space Agency has constructed over the past decades is at risk if it is being built on chips from China. So is the military equipment, the railroads, you name it.

In short, Europe needs its own domestic "Silicon Valley," and I strongly suspect that what we're watching is the careful positioning of the Grand Duchy to become just that. I realize that this sounds insane and far-fetched. But again, consider its location, dead center between Europe's two largest economies and most technologically advanced nations.

What we may be watching, in other words, is the creation of a kind of "space version" of the old Republic of Venice: a banking center, fronting for transnational financial and corporate interests, collateralizing loans with trade it conducts all over the Mediterranean and Europe, and which had the money muscle to found a state arsenal and buy the technology to protect its interests with short, sudden, sharp applications of military force if need be; it was The Godfather, with cannons.

Luxembourg is already a banking center, and has now lured companies specializing in robots and space to its borders. Next, if my prediction proves to be correct, will be the computer tech industry itself. It may not happen soon, but given the Chinese hacking story, my bet is it will happen eventually.

See you on the flip side...