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This insane push for surveillance and privacy infringements could be the catalyst needed for the next state exit from the EU

I think the worst european country in terms of online freedom right now is the UK, which kind of defeats your point entirely.

and thus further decline of the only democratic superpower left? Why would that be desirable?

The EU is accelerating into a bureaucratic Rube Goldberg machine that does nothing except say the word Democracy out loud and tax their citizens