I'd like to see a similar approach to what happened with tobacco: test apps for spyware, put warning labels in big letters (or simple icons) right up front, teach kids about the dangers in school, but ultimately let everyone decide what they do.

Of course, just as with tobacco there are huge American companies which are going to oppose this sort of transparency. And of course rolling out teaching standards requires that some standardization for app privacy exist in the first place, so I don't expect this to happen fast (if it could ever happen at all).