Privacy is a funny thing. We all want it unless there's a good reason not to have it.
Let me put my Google Fanboy hat on for a sec. Google's algorithms do read email going through the gmail servers. On the surface that's bad. But wait. Every email client HAS to read, to some extent, your email. That's how they get delivered. The mailman reads the envelope of every snail mail letter you send too.
So Google goes further and scans the whole email. Scary and creepy and bad right? No. By reading the email they provide service back to the user. Google Now is one of the coolest things ever and you don't even realize how cool it is until it surprises you with its notifications. Besides, it's not like a human reads it. It's just a computer algorithm.
If I get an email from United Airlines with my flight information Google Now knows I'm going on a flight. It knows what airport and what time. Google has traffic information and knows where I am and will give me a notification that based on current traffic I should consider heading to the airport to catch my flight.
It knows when I arrive at the airport and sends me a card with the QR boarding pass right on it.
Point is, I get value so I don't mind. If a company just collects data and gives nothing back then people don't like it...at least I don't. Many many many companies do just that. But if companies use that data to provide benefit for the user then it goes a long way to making that collection worthwhile.
By the way, Google is constantly at odds with big government and their frequent requests to hand over user data. The government asks all the companies for users emails and other data and they all just happily hand it over. Not Google. They ask for warrants and push back. Ultimately they comply with the law...they have to. But at least they push back. You're not going to see that from Yahoo, Microsoft, or even Reagan.com.