I completely disagree with Wittes' take that there is any misappropriation of this quote or that it's meaning as commonly used in this discussion today differs greatly from it's original meaning. And please see comments above wherein Wittes' potential bias is highlighted, given his stated positions on these matters.

In the historical case, Franklin was making a simple argument: don't take the Penn's offer of a short-term increase in security at the cost of long-term liberty.

This reconciles perfectly well with the usage in this debate today: don't take the FBI's offer of a (supposed) increase in security (by weakening strong encryption) in exchange for a decrease in long-term liberty.