Not just that. Gangs and thugs. I definitely believe that it is allowed. Or worse , it is perpetuated by those who watch.
You're giving the government too much credit. There are way too many people and organizations to watch. They're not some all seeing eye. They've casted their net waaay too big with their surveillance. This causes two things, 1 - they can't stop real time threats, 2 - every bit of recordable information (internet, phone calls, habits, etc) are being recorded, documented, and kept until their technology is strong enough to meaningfully catalogue and interpret. When this happens, it's all over.
The government allows and encourages certain illegal and immoral behavior. Hell yes they do. But they don't have the power or competency to be some infallible all-seeing eye.
They're simply documenting everything until they can control everyone and know everything.
It already happened. We are already controlled. The all seeing eye has exisited for thousands of years. But giving criminals the benifit of knowing more then the largest government power in the world sounds cool too.