That doesn't make much sense in this context - the "nanny state" refers to the government taking care of your physical needs, like a nanny. But even if you sweep all government regulation under the blanket of "the nanny state", that's still not what's being proposed here: what they're proposing is removing protections previously afforded by the government because they've been abusing them for so long. In essence, all that's being proposed is that everybody plays by the same set of rules.