SLS costs more per kg of payload than a smaller launcher. End of argument.
I'm not sure SLS ever gets below $20,000 a pound to LEO. SpaceX is already
selling Falcon 9 launches at $2,400 per pound to LEO. And that's their expensive, early system. He thinks $500 a pound is doable with expendables, and hopefully get down to $100 a pound if his grasshopper goes well.
If the government can launch 200 times the payload for the same dollar, they would be fiscally insane to retain the SLS.
--and then we get only what Musk can fund privately--and his LV was 80-90% gov't, so is that really private spaceflight if he is just another contactor?
Of the $1.2 billion in SpaceX (now valued at about $2.4 billion), NASA has contributed about $500 million, which is 20 to 40 percent, not 80 or 90%, and their private Iridium launch contract is $492 million.