(IIRC jwz's "testicle cup" image HN referrer redirect is no longer active/functional.)
Anyway, I get that jwz loves to be inflammatory toward everyone because that's who he is, but if Google didn't require privacy policies for every listed app, I'm sure a bunch of people would be crying foul.
I could easily imagine a shitty ad-supported screensaver that was somehow using your data to target/sell ads. Remember that we live in a world where flashlight apps have been used to exfiltrate data from phones. Or perhaps a more innocuous use of user data: maybe the app tracks which screensavers are used and sends that data to the developer.
And, regardless, I see no problem with a company not wanting to have to do manual review to determine what apps do and don't require privacy policies, and just blanket-requiring them of everyone.