William Hague told the Commons that every intercept had to be personally signed by him. Reuters

On Monday the Guardian carried a story that British intelligence had spied on delegates at two G20 summits, those chaired by Gordon Brown in 2009. Laptops and mobile phones had been hacked, and internet cafes installed and bugged. With many of the same heads of government gathering for the G8 summit in Northern Ireland, the story was, to put it mildly, sensational.

The source was the American whistleblower, Edward Snowden, whose revelations about the US National Security Agency had been running in the Guardian and Washington Post for a week. It was initially hinted at by other British media but was covered by a D-notice (warning against publishing anything that could damage national security) from the government.

It vanished from general view. When the foreign secretary, William Hague, was questioned by the BBC on Monday, no mention was made of the affair. The media has been bidden to ignore the story and has done so. This was despite it running in leading newspapers round the world, from America and Europe to China and Russia.

Complaints at the bugging from governments in Turkey, South Africa and Germany have poured into the Foreign Office, yet the nearest British journalists can get to the story is to report the protests as foreign news.

Unlike 2010's WikiLeaks saga, Snowden's material had nothing to do with military secrets. It concerned the "trawling and scooping" by the NSA of global electronic communication and the use of foreign intelligence agencies such as Britain's GCHQ and the obtaining of data from companies such as Google, Microsoft, FaceBook and Apple to apparently circumvent national laws on personal privacy. The material is stored in the NSA's massive data facilities in Maryland, soon to be upgraded by one in Utah.

This scooping of intelligence under the "war on terror" rubric is clearly an intrusion on every citizen's electronic persona. Such intrusion has the capacity to stop anything from a loan or insurance to a degree or a job. There is no hiding from these trawls. As for imagining such material can ever be secret, the NSA's most sensitive data was downloaded by a 29-year-old working for Booz Allen Hamilton, a subcontractor, and passed anywhere in the world.

I try to calibrate my response to such stories. WikiLeaks revealed much about America's "imperialist" stance in the Middle East, but it was mostly embarrassing gossip. Britain's phone-hacking affair was distasteful and illegal, but hardly a hanging offence. Even Snowden's examples of economic spying were remarkable in their extent, but hardly surprising for those hardened to modern diplomacy.

What matters here is first the mendacity. I see no problem in exchanging data between British and American security – except where, as in the NSA's Prism program, it is a device to circumvent legal constraint. There may be few people in Washington or London who really seek a global data empire through blackmailing the world's population; but hoovering intelligence on millions of private individuals extends far beyond the needs of national security, beyond the needs even of normal police work. The war on terror is rotting the internal organs of free states.

Standing in the Commons last week, William Hague denied he wanted to "trawl the contents of people's phone calls" and said every intercept had to be personally signed by him. He said that statute law, together with judicial and parliamentary oversight, had everything under proper control. He did not add that the government does indeed want to trawl the "meta-contents" of all calls and emails. We now know that it has access to once confidential international databases in doing so.

Ministers and judges cannot possibly control the flow of intelligence now passing through the NSA and other agencies. They cannot even authorise an estimated 500,000 requests from law officers to internet and phone firms each year. As for the 3m surveillance orders made annually by British public bodies, a mere 0.5% are reportedly even seen by a judge. Ministers once said they personally authorised all phone-taps, which was untrue. As Snowden said, what made him blow his whistle was not the material itself but "the continuing litany of lies" from intelligence chiefs to Congress.

The reality is that I have yet to encounter a British minister or parliamentarian who is not putty in the hands of Big Security, the security services and its attendant industries. Spies are treated like NHS nurses, godly creatures who can do no wrong. I am told the last home secretary with the guts to stand up to Big Security was Viscount Whitelaw.

The true message of Snowden is that no aspect of our electronic lives is immune to a security-industrial complex that can cite the war on terror for activities against individuals and groups that are way beyond democratic or judicial oversight. Even where controls are in place, any barrier, password or ringfence can be circumvented with just a click. Electronic records can be accessed not just by governments but by corporations and other services, as revealed in last month's market in 27m EE mobile accounts between a quick-witted consultancy and the Metropolitan police.

If the market in data cannot be suppressed, how can it be controlled? The world once struggled to curb the nuclear weapons it could not un-invent. Now it must struggle to do likewise with the hoovering of electronic data. As the White House's Jay Carney agreed last week, that means starting with a full knowledge of what is going on. There is no danger in such knowledge. The US and Britain are not under any existential threat.

America's reaction to the NSA material has been significant. Libertarian groups and voices in Congress and the media have been outraged. A Rasmussen poll found 59% against the data scooping, with just 26% in favour. Even the White House held back from outright denunciation, accepting that the revelations "sparked an appropriate debate" and raised "excellent questions". The Patriot Act might even need review.

In Britain there has been no such response, for the most part silence. Hague plays the police-state defence, that "the innocent have nothing to fear". Former home secretaries club together to write to the Times, demanding not less state surveillance but more. The D-notice committee opens a bleary eye, warns editors off, and goes back to sleep. The media does what it is told, and turns quietly to Nigella Lawson. On such a basis freedom rests.