One of the things that many people don't understand is that the government has been keeping tabs on US citizens since the Hoover era, but only those who are linked to overseas terror/spying. While this hysteria may get to insane extremes, i.e. the Palmer Raids and the Japanese internment, this is by far not something that's exactly news. The NSA works primarily in overseas signals intelligence, and is only allowed to investigate domestically through a lengthy warrant from a federal judge and if there is ample evidence that the case is tied to overseas. However, if it's something crucial and cannot wait for a warrant, then they maybe able to go ahead and tap.This is the exception though, not the rule.
Out of - how many was it? 1650? Warrant requests, zero were denied. A rubber stamp court does not constitute effective checks and balances.
Another thing to note is the fact that the NSA, FBI, or CIA does not have the time, money, or resources to continually keep track of 320 million American citizens.
Presumably this is why they have a private contractor doing it.
Tech companies such as Google, Facebook, Twitter, and so on keep a closer eye on American citizens out of the interest of advertising and sales. PRISM is essentially a giant dumpster for data, and simply means they have data on hand so it doesn't expire.
The highest irony of this is people who post about how horrible this is on Facebook while on Google Chrome, without using adblock, noscript, or ghostery.
Corporations have a clear motive - money. In addition, corporations do not and cannot arrest whistle-blowers, and have no reason to do anything other than target ads at you. While I agree that people should in general take an interest in their own security, google's targeted ads seem a heck of a lot less sinister than this. Of course, it's rather moot since Google and Facebook are both among the nine companies to whose servers these folks have direct access.