I wonder if there's a subset of the population that actually reacts to constant government surveillance by feeling safer. To continue the author's baby rat analogy, this would be the equivalent of baby rats believing the propaganda that the government surveillance system is their mother as opposed to a predator.
If it isn't clear - I'm talking about the "if you have nothing to hide then why do you need privacy?" crowd.
Surveillance itself is opportunity protection job to be done better and effectively. The problems is with possessors of surveillance data and decisions makers. No man, no problem. May be regulations should be more stricter in not allowing people to abuse surveillance.
Your questions are to the point. If the actors you mention are independent and no one single actor has authority over them, we have system that is self regulating. This system is working in mature democracies.
If it isn't clear - I'm talking about the "if you have nothing to hide then why do you need privacy?" crowd.