Virtually all governments spy on their and other countries' citizens these days, not just the US. We Germans spy, the Brits and the rest of Five Eyes spy, the Russians spy, the Chinese spy, the Iranians spy and I bet that even North Korea has quite some good hackers.
And for the rest of your comments: indeed, a "new internet" would be required. But as you can see on the adoption rate of IPv6, we're stuck with this mess unless quantum computing forces us to switch.