Indeed. Many people seem to misunderstand the purpose of the tor network. It is designed to conceal the sourcing node of a packet. That's it. Nothing more, nothing less. The only guarantee you get --and the only one you really need to remain anonymous-- is that your IP isn't stamped on the packets coming out of the exit node. You're not supposed to trust the exit node --or anything else you connect to through it-- for anything else. That's why you don't send login credentials in the clear over the exit node. It's why you don't send plaintext email over tor, or sign into services that are ever touched by a non-tor connection, or engage in plaintext conversation on IRC and have any expectation of privacy. Tor guarantees a different IP on the network packet, and that is it. And so far, it seems that the Tor project has made good on this guarantee. I've yet to hear about a deanonymization incident that can't be traced back to mistakes such as the ones above.
The government is allowed to create fake identities and corporations, use private facilities and infrastructure, etc. in order to run sting operations against sophisticated criminals. That's exactly the sort of "real police work" they should be doing, rather than surveillance.
Where is there ever a "degree" of visibility as to whether something is a government honeypot?
