Ads provide a lot of exposure instead of just eliciting a direct response. Better tracking for ads benefits content publishers and service providers, many of which users enjoy. You don't have to click on an ad for ads to have value.
Magazines, radio, and television are all tracked in different ways. When were ads not tracking users? On stone tablets?
"Wealthy people already subsidize lots of content for political gain, so nothing is changed by having it be targeted ad supported or not."
They do, but it would be a much smaller percentage if the content creators had a way to monetize it.
"Most small companies cannot use the legitimate ad networks because they don't have enough volume. So this is a non-issue."
How is it a 'non-issue'? Many startups, especially here on HN, rely on advertising as a business model.
As to your points, though, paid content is great. If people won't pay for it, they probably don't actually want or need it.
I don't want to see any ads. No ad is relevant to me, so all ads, even supposedly targeted ads are random. In 30 years of using the web, I have literally never once intentionally clicked on an ad. So better tracking for ads gets me nothing and loses me a lot.
Wealthy people already subsidize lots of content for political gain, so nothing is changed by having it be targeted ad supported or not.
Most small companies cannot use the legitimate ad networks because they don't have enough volume. So this is a non-issue.