The trouble is that everyone else is pursuing tech unhindered by such regulations at breakneck speed, and Europeans realize that Europe - once the center of science and technology - is increasingly sliding into a backwater in this space and an open air museum.

Now, some will agree with you and say that privacy should never be violated, but nonetheless accept a certain measure of tolerance toward that kind of violation, because they see rigid intolerance as causing more harm than the violation of privacy itself is causing [0]. This harm is chiefly the economic harm caused by the burden of regulation and the roadblocks it introduces.

Perhaps this isn't true, but if it is, then moral offense is likely to have little effect. A more effective means might be the make following regulations cheaper. Of course, as we know, when you make something cheaper, you increase demand. This means that EU institutions would likely see this as an opportunity to increase regulation, nullifying the gains of introducing less costly ways to adhere to regulation.

[0] This reminds me of Aquinas's view of prostitution. Naturally, Aquinas saw prostitution as a grave, intrinsic evil. No one is ever justified in soliciting the services of a prostitute, much less of being a prostitute. That's the moral stance; it concerns our personal moral obligations. However, from the position of the state and how the state should police such activity through law, Aquinas saw the criminalization of prostitution, however good in principle it might be, as a policy that would be practically worse - even disastrously so - than law and policy that is permissive toward prostitution. Whether you agree or disagree with him, the principle holds, namely, that the state not only does not need to police every bit of immorality, but by doing so, may actually contribute to the destabilization of society and to an even worse condition than the one it is saddled with.

> sliding into a backwater in this space and an open air museum

Or a place that follows a different approach than "break it to make it" mad dash, that fosters a different - perhaps richer - culture with tech more aligned to people's needs, and overall healthier to live in. If there is a good set of regulations in place. And that is where EU is not consistent, and this backtracking not helpful.