How do you propose the no-spying part? With laws passed by country? Nothing in your setup prevents spying, and spying is extremely lucrative in a capitalistic society, so people will still find a way to spy.
You are putting all your trust in the server. But those servers are where the spying would move to if it needed to. You cannot create a technological system that prevents spying, since you have not removed the incentive to spy.
Make it illegal to do targeted marketing and then you will have a dramatic reduction in spying. You'll also have a short-term dramatic drop in economic efficiency, something the HN crowd is likely to decry as equal to the end of the world. But I think it's much more likely that we build a sustainable society with good, long-term-growth economics if we put more limits on capitalism.
Edit: Facebook doesn't care if you're reading those documents on some simple text-web. They'll find out anyway, either via your absence from the 'regular web' or any other clue they can find. The spying won't stop just because you're using some primitive technology.