Apparently he was not far off, Google street view cars did collect wi-fi communications beyond the SSID and MAC addresses of the mapped areas:
Using Aircrack-ng, anyone can capture wi-fi data, along with SSIDs and MAC addresses. That's nothing new, Google didn't invent it: "wardriving", which is the name for it, has been around for quite some time.
The only difference between Google capturing your packets and your neighboor doing it, is that Google possibly has the computer power to decrypt those packets, if there are enough of them, but even then, if you used WPA2 and a strong password, not even Google can do anything with it.
In the case of online banking, shopping etc, there is an extra layer of security, that is the HTTPS protocol.
Ever since wi-fi became a popular technology and people started having wi-fi APs and routers everywhere, they've been told to use the strongest encryption available with a strong password. It's too bad that most people don't give a damn about the issue and prefer to complain to the police after their wi-fi password is broken and someone uses it do download child porn.
In short, a dumb government is made by dumb politicians, who are just people: dumb, helpless, ignorant people. These politicians are the same ones that use their capitalized family name as their wi-fi password (using WEP) at home, get hacked, and then legislate against wardriving.