>Does that mean that privacy is dead by an inexorable process?
Yes.
>Doesn't that imply that individual liberty is also, eventually, dead?
Yes.
>How can we, the people, administer the thousand cuts?
Stop carrying a cell phone.
There was a brief period of time, from 1990 to 8:40 AM, September 11th, 2001, when you could do all sorts of stuff online, and the powers that be either didn't, or couldn't, monitor it. That's changed, and that freedom will never come back.
However, no matter how bad the modern surveillance state gets, contrast it to the ancestral environment: a village of 50 to 200 people, most of whom are related to you, watch your every move, and can determine if you live or die. Hunter gatherers don't even have a word for "privacy". It would take real creativity for things to get that bad today.