Here's a Devil's Advocate position (not necessarily my personal beliefs, so please don't downvote based on disagreement. Just rip it to shreds instead!):
The fear of losing privacy to the government is based on the fear that this increased surveillance will be used by the government to smother dissent. This is a valid fear, but has the government yet used surveillance to smother dissent? If you can find a solid example of this, I'd like to see one (and for all I know, there could be many, I'm genuinely interested).
Until the government has been caught using surveillance to stifle dissent, it seems like increased surveillance only serves to reduce crime. Of course, there are illegal things that, in my opinion, should be legal, but this is a reason to petition the government for change, not break the law... perhaps a reduced ability to break pointless laws would galvanize the population into large-scale activism?
Fear of government surveillance is entirely fear of smothered dissent. We must make sure our fears of the latter are logically sound before we fear the former.
EDIT: Because I love arguing with myself, I'll point out that it's possible some wrongly illegal activities may be embarrassing for some individuals, and they would be hesitant to openly campaign for them. It still feels weird to argue for privacy on the grounds that people have a right to get away with certain things, hmm...
EDIT 2: 15 minutes and already COINTELPRO negated the argument. Good counter, thanks.
EDIT 3: Really appreciate that I seem to have gotten at least one upvote. I get really dismayed when politely-expressed unpopular opinions are downvoted, because I feel the best way to move the dialogue forward is to engage with opposing views, not hide them (even if your level of engagement is comprehensive refutation, that's still useful).