Conservatives call on Elon Musk to step in after Liberals provide loan to Ottawa-based satellite operator

September 21, 2024 Canuck

A $2.14-billion federal loan for an Ottawa-based satellite operator has Canadian politicians arguing about whether American billionaire Elon Musk poses a national security risk.

The fight involves internet connectivity in remote regions as Canada tries to live up to its promise to connect every Canadian household to high-speed internet by 2030.

Telesat CEO Dan Goldberg said “there appear to be some misunderstandings” about the nature of his company’s deal with the government.

A week ago, the Liberal government announced the loan to Telesat, which is launching a constellation of low Earth orbit satellites that will be able to connect the most remote areas of the country to broadband internet.

Conservative MP Michael Barrett objected to the price tag, asking Musk in a social media post how much it would cost to provide his Starlink to every Canadian household that does not have high-speed access.

President and CEO of Telesat Dan Goldberg takes part in a press conference in Ottawa on Wednesday, July 24, 2019. (Sean Kilpatrick/The Canadian Press)

The Conservatives also tried to connect the contract to former Bank of Canada governor Mark Carney, who was appointed as an economic adviser to the Liberals on Sept. 9, four days before the Telesat loan was announced.

Deputy Conservative leader Melissa Lantsman said in the House this week that Carney’s “close friend, the CEO of Telesat, got more than two billion of Canadians’ tax dollars to build a broadband network that other firms could have built for half that price.”

Goldberg confirmed Carney is a friend but said “he had absolutely nothing” to do with the loans.

In announcing the loan, the Prime Minister’s Office said Telesat would provide capacity to the defence industry and support NATO and Norad modernization.

Goldberg said the agreement doesn’t include specifics about using the system for defence. He said Telesat’s constellation can be a “key enabler” for Norad modernization.

In 2022, the Liberal government outlined a $38.6-billion plan to modernize the joint aerospace warning system for Canada and the U.S.

Musk has become an increasingly controversial and political figure in recent years, particularly since he bought the social media platform Twitter, which he renamed X. He has used his large reach to share false information.

In the last week alone, Musk shared a false report that explosives were found near a Donald Trump rally; warned that “unless Trump is elected, America will fall to tyranny”; and questioned why nobody was trying to assassinate President Joe Biden or Vice-President Kamala Harris, after a failed assassination attempt on Trump.

Goldberg suggested there are good reasons to keep such a contract with a Canadian company.

“Space is a highly strategic sector, it’s very capital-intensive. If you look around the world, governments are routinely partnering with their domestic operators,” Goldberg said.

Erik Bohlin, the chair in telecommunication economics, policy and regulation at the Ivey School of Business, noted there have always been some restrictions around foreign ownership in telecoms, including in Canada, but the satellite space is “a new field where so many things are happening.”

Adam Lajeunesse, an associate professor at St. Francis Xavier University focusing on Arctic and maritime security, said the government has some legitimate arguments when it comes to Arctic defence and national security.

He said there’s no reason to doubt that Starlink could meet the Canadian Armed Forces’ needs today, but it’s important to look at what may happen with the company in a decade or two.

“Strategic communications is simply vital for all safety, security, defence activities across the North, not to mention civilian activities,” he said. “Having one supplier, particularly when that one supplier is outside of the government’s control, is a dangerous situation to have.”

James Fergusson, a senior research fellow at the Centre for Defence and Security Studies at the University of Manitoba, said Musk is “a Trump guy” who has “said things which conflict with American foreign policy as it now exists.”

But he pointed out the U.S. Defence Department uses SpaceX, Starlink’s parent company.

“To the Americans, he’s not a security problem.”

This report by The Canadian Press was first published Sept. 21, 2024

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