It's easy to imagine the kind of data government has, imagine its ability to process that data, and easy to interpret that they will do it. But it's also important to recognize that this is conjecture. From my experience in government: they nailed the user experience (check out http://dsbs.sba.gov for some awesome gov UI), but really overestimated government's capacity to build intelligent technology like this.

That's not really the point. Even 1/10 as sophisticated technology can be equally potent, especially if they are concentrating on a person (if the data is there, they can even do the correlations manually, say in Excel. It will just take more time).

Furthermore, the creation of the technology (and even the operation) can be outsourced to private entities. Or just bought wholesale.