No, it hasn't. Almost every single extension I install tells me some variant of "This extension can intercept and modify all of your browsing traffic". That's not "well balanced", it's completely broken. This is happening clearly for extensions by well intentioned people that do not need those permissions. I can't help but cynically interpret the current situation as intentional on Google's part because having the security model be "trust Google to vet the extensions" happens to centralise all the power with them. If you can't trust an extension from the wild then they might as well not exist, right?
People laughed Java out of the browser because it took 500ms to start, but at least it had an actual security model.