1. Government can just go to one of 3 top email providers (Yahoo / Google / Hotmail) to get access to surveil most people.
2. Government can do surveillance, but must deal with hundreds or thousands of email providers.
3. Government must get a warrant (or at least have someone physically infiltrate your house) to start surveillance on you.
The point here is ramping up the cost / difficulty, so that the government adopts a more conservative approach to using these tools.
I would also point out that GMail has more than 400 million users. Investigation of 2,000 of them does not constitute mass surveillance or evidence that it's too easy to get people's data. Is it really outrageous for 0.0006% of the population to be persons of legitimate interest in investigations?
[1]http://www.nytimes.com/1998/05/26/nyregion/raids-and-complai...
And of course you can use PGP with almost any email system right now. Just download thunderbird and enigmail (or whatever is the good one these days) and use gmail through IMAP.
[1] http://en.wikipedia.org/wiki/Hushmail#Compromises_to_email_p...
PGP could make it very difficult to surveil the whole population, but that's not what's going on here. There's not really a way to stop a sovereign government from getting data on individuals of interest.
Not with the NSLs, no. But when you consider the not-so-secret rooms at all the ISPs: that is what's going on there.