Re: WTF?
It's a sign of desperation.
Weakening crypto will basically have the same effect as the police recommending you install easy to pick locks in your backdoor so they can check any time that you're not committing any crimes.
There are two main problems with that approach:
1 - it makes it easier for the bad guys (and certainly for their current favourite, the terrible terrorist) to defraud people. Or, let me translate that in Daily Mail speak: we would be HELPING the terrorists to finance what they do because we'd make regular crime so much easier.
2 - the mainstay approach for these people to hide is to steal identities. Now, what gets easier when you make it easy to hack stuff? Err, well, umm,.. Yes, exactly.
Especially in the US it appears all sanity has gone out of the window. What I find particularly galling is that US companies are attempting to solve the problem that they cannot protect privacy to EU levels (which costs them a LOT in sales already) by weakening EU laws to the same broken level - that's in reality what Safe Harbor does.
So, enough already. Stop the bad PSYOPS because it's no longer working. I guess it would have if you had not so grandly abused it, but now you're facing at least a decade of trying to rebuild some trust. I'd be surprised if you manage this in 10 years, actually.
One more thing: if you stopped focusing on approaches that are wrong, you could maybe develop the mental bandwidth to come up with new ideas that do NOT involve ignoring people's right to privacy.