>> Lowering the data protection of it's citizens in comparison to the rest of the world. I was under the impression governments were supposed to protect their citizens.
This depends on whether you see "citizens" as individuals or as a group.
In other words it's possible that to improve the security (and thus protect) the majority, the rights of individual citizens need to be eroded.
For example, to protect vulnerable citizens from crime (the cliche of child porn is useful here, but it extends to most-all crime) it's useful for prosecutors to be able to collect evidence against guilty parties. This means that the erosion of some privacy of those parties.
Thus the govt balances "group security" with "individual privacy". It has always been so. So to return to your original hypothesis;
>> Lowering the data protection of it's citizens in comparison to the rest of the world.
... and also, making it easier to detect and prosecute criminals, and thus protect the citizens from physical harm.
Now, of course, whenever it comes to balancing one thing against another, there's no easy way to make everyone happy. We all want perfect privacy, coupled with perfect security. Some will say that they'll take more privacy, less security - others will take more security and less privacy. Where you stand on this issue of course depends on which side you lean.
More fundamentally though there's a trust issue. Citizens (currently) do not trust governments. They assume that these tools can be used to harm more than just criminals. (They're not wrong.) If you don't trust the govt to act in good faith then naturally you choose privacy over security.