The Fallacy of False Freedom
You say, "if we were in a true police state we would not be able to criticise the goverment as openly as many of us are currrently doing."
But even sheep are free to bleat on their way into the abattoir.
Most totalitarian states, police states, etc, have some sort of special freedom, touted as proof that the regime is benign, that they're not tyrannical, etc.
In the Soviet Union, it was the freedom from imperialist and capitalist exploitation. Workers, their families and communities, were free to work for themselves (collectively, of course), rather than having to work for their imperial or capitalist masters. How could it be wrong for the Soviet state to strongly defend that vital freedom from counter-revolutionaries and the like?
In Nazi Germany, it was the simple freedom for the German people to simply be German. What could be wrong with that? It would surely be racist to deny the German people their right to be German! So of course the Nazi state had to defend that right, that freedom to be German from those who would deny the German people their rights, such as Communists and Jews.
There are plenty of other examples, even now, such as North Korea, where the people aren't oppressed, but free from tyranny, capitalist exploitation, etc, so common elsewhere in the world. They even have multi-party elections - how can anyone deny North Korea's democratic?
Here, in the UK, we're obviously free. Unlike in real, proper police states, totalitarian dictatorships, etc, we're free to express disagreement with the government, voice opposition to government policy, vote in elections, form and join political parties, etc, etc.
It's only extremists, terrorists, etc, who have anything to fear. As long as you're not one of them, you have nothing to worry about.
In other words: as long as you stay more or less in line with the mainstream, follow the herd, conform rather than dissent, and remain part of the so-called "law-abiding majority", you're free.
But what counts as "extremism"? "Terrorism"? What comes under "etc"? Icelandic bankers come under at least one of those categories (how useful "etc" is in counter-terror legislation!). And peaceful protesters and journalists have been treated as "domestic extremists" by the police - sorry, I mean ACPO. How much can you deviate from the mainstream before you're regarded as a threat to law and order (just to be on the safe side)?
Letting people continue to exercise enough freedom of political speech to be able to post the many comments above is a very clever way, by the State, of subverting opposition to the emerging totalitarian police state. It means that those who voice warnings about where we're heading are then used as "proof" that the warnings are simply wrong. How very New Labour! How very Orwellian.
Even sheep are free to bleat on their way into the abattoir.