No, it's a win because the government is not the only, and in most cases not the worst, threat.
Insiders (like Snowden and Manning, ironically) are one of the biggest threats. Being attacked by non-USG outsiders is a major threat ("hackers", state sponsored or not). Your business partners being hacked, or having lax security, is another threat. USG is probably near the bottom of the list of actual threats for most people, in terms of frequency; they just have the most amazing resources.
If the "evil NSA boogeyman" is enough to get people to finally care about security, that's great. It's like people preparing for zombies by buying water, freeze dried food, radios, shotguns, etc., when in fact they're at the same time preparing for the far more likely earthquake or civil insurrection.