The NSA reaches out
longnow.org
longnow.org
Given the 9/11 CYA response and a lack of evidence that anything the NSA does is effective, I don't see the downside of #1 or the upside of #3.
#2 presumes only the nation-state can protect business and the internets. I think the multi-nationals have moved on, and the masses will too.
If encryption works, the choices are stark: A. Strong encryption is made illegal, and we are living stripped naked in the panopticon, or B. we have pretty much absolute privacy in communications, and that means that the prerogative governments assume they have, to snoop as they choose, is over.
I would rather have B. The government has demonstrated they can't contain snooping.