Yes, it's supposed to be an unrealistically optimistic thought experiment, both in favour of the efficacy of technical solutions (e.g ignoring the societal component in making those successful) and government power (e.g ignoring economic side-effects, and also ignoring push back from society - which is the whole point). To show how technological solutions are insufficient when they are left to play out against unchecked power.
In reality, there are multiple forces beyond legislation that naturally add friction, which you allude to... However government can get very far before hitting those thresholds, especially if there is no pushback from the people. The other factor is that the more progress they make with such democratic eroding policies, the more power they may gain, and the easier more extreme policies are to enact, in spite of economic consequences. For instance this is very much the case with the GFW in China where not all workers have access to the full wealth of information available on the wider internet.
> I agree that China is currently, to continue your metaphor, winning the fight against privacy—but only because using the government-friendly superapps is necessary for everyday life, and not because they've blocked the likes of Tor.
Part of that is also made possible by controlling the internet. In my made up scenario this is at the "we mess with the fabs" level of government intervention, for which it's infeasibly hard for society to come up with a technical solution... and this does have real consequences on China's economy as workers do not have the same degree of access to information that we enjoy in the west to perform our jobs efficiently.
The point being, it can and does reach extremes when any style of government is left to it's own devices and people do not, or cannot fight for such freedoms.
that would be the intended outcome: comply or die.
> Now gov mandate that all hardware must have have backdoors to circumvent those measures.
A government could legislate that it may not rain anywhere in the country on Tuesdays, but executing that isn't practicable. Likewise, backdooring one family of CPUs may be possible, but you can't simply tell chip fabs to backdoor each and every design. They'd grind to a halt in order to comply.
And I want to say that there exists provably un-backdoor-able "zero-knowledge" computing, something like Ethereum's smart contract ISA, but I may be misremembering.
In the end, our governments are democratic, we elect politicians to represent our will. They shouldn't be pushing for things like backdoors at all when no citizens are in favour. So yes,
> [...] we must push back against policies like this to prevent erosion of our values, do not "give them an inch" so to speak.
I agree that China is currently, to continue your metaphor, winning the fight against privacy—but only because using the government-friendly superapps is necessary for everyday life, and not because they've blocked the likes of Tor.