The model practiced by East Germany was probably the most effective one when controlling populations.
The idea is that you hire or otherwise coerce a significant portion of the population to spy on another part of the population, but you do not tell them who any of the spies are.
The person you could be told to watch could be another government spy. It could be a government spy from a different government. It could be a real threat, or it could be a test of your loyalty. People can also be made to spy on you. Maybe the guy you are suppose to monitor is suppose to monitor you right back. You are made to have no idea. This provides a very effective means to paralyze any sort of opposition movement.
However, at a certain point it becomes nearly impossible to tell the difference between incompetency and maliciousness in government when it all reaches a big enough scale. I think we are at that point now.
Historically, a significant number of the conspiracies committed by the USA government against the public in the past were done to simply cover up bad decision making and the damage this idiocy has caused to the USA.
I mean, seriously, when you are a director of the NSA and you think that making your office look like this is a good idea...:
You are not playing with a full deck here. The apparent fact that he regularly used it to show off to other government officials and their typical reaction was to get excited and want to sit in the captain's chair (rather then recoiling in the horror at the insanity) just means that most people that high up are as confused, deluded, and as stupid as he is.
Scary actually that anybody takes these people seriously, much less give them a budget of billions and put them in charge of one of the most powerful organizations of all of human history.