Solution: 10% tax on all satellite internet revenues to fund space based telescopes. Could really improve astronomy.
It's a resource allocation efficiency issue, through and through. The government is always going to pick "winners and losers" in high value industries like defense, resource extraction, and aerospace but all of those investments have very rough feedback loops that are disconnected from the decision making process. If government investments/grants came at least with profit/revenue sharing arrangements, there would be a positive feedback loop and an opportunity for the system to evolve and improve even if the net income change after administration overhead is zero or even slightly negative.
Obviously this isn't tenable for basic scientific research but our industries do very little of that anyway, even with government funding available.
The target market is not elderly people retired to cabins in the woods. The antenna costs for individual users would be prohibitive (10s of thousands). SpaceX is aiming for military/government first, then fixed-point industrial (oil rigs, mining camps, large ships) and then aviation (internet onboard airliners). That's the priority structure.
Another angle is to look at the orbital inclinations to see which customers Musk is targeting. At the moment he isn't sending sats further north than London (+/-51*). That suggests their first/primary/target market doesn't exist north of London. It looks like they are going after either the military drone or luxury aviation consumers. I don't see communities in Canada's north getting connected anytime soon.