Fading of Satellite Proposals
 The competition between the Air Force and the Navy's Bureau of Aeronautics over satellites might have grown keener had it not been overshadowed by national and  international events. In the fall of 1946, President Truman's administration faced formidable problems at home and abroad. The railroad strike in August had threatened to paralyze the nation's transportation system, and Truman had countered by threatening to take over the railroads and draft its workers into the military. On the international front, the hoped-for mutual understanding with the Russians became less likely as Stalin became increasingly more hostile. With the United States facing increasing obligations abroad, preparations for the next year's budget brought decisions to restrict long-range research and development programs in favor of expenditures promising more immediate benefits. By December, such strictures had ended the prospects for satellites as a military weapon. The Air Force ordered RAND to shift emphasis from satellites to airplanes and ramjet vehicles.
During the first quarter of 1947, Project RAND wound up its first satellite study and published a final report in April. The favored configuration was a 3-stage rocket using hydrazine and oxygen, with an initial mass of 38 600 kilograms and an orbit attitude of 648 kilometers. The cost for a satellite in orbit was estimated to be $82 million.24 If there was no immediate result, RAND's dozen reports on satellites had an important side benefit. The RAND staff had become thoroughly versed in rocket vehicles and their potential. Although the new Air Force directive emphasized air-breathing engines, RAND continued to consider the possibility of long-range rockets. In effect, this marked the beginning of the RAND-Air Force work on intercontinental ballistic missiles-the great driving force for rocket developments in the 1950s.
The Navy, however, took a different tack. The previous August, the Naval Research Laboratory had been authorized to develop a high-altitude test vehicle for scientific research. The satellite supporters in the Bureau of Aeronautics saw science as the savior of their project and began emphasizing this aspect. In November, the Bureau of Aeronautics requested the Naval Research Laboratory to study the use of satellites for scientific research and allowed the Martin and Aerojet contracts to continue.