Good Grief! This sure is a rumour network, and almost as full of misinformation as the journos everyone complains about!
The wire stories missed the important stuff and settled for sensational (no suprise there)
See
http://ostp.gov/htmlFact SheetSPACE-BASEDPOSITIONINGNAVIGATIONTIMING.pdf
forthe fact sheet. The NSPD is classified but this is a good summary.
In case nobody was paying attention earlier this year the U.S. and EU agreed to make GPS and Galilleo compatible and to some extent interoperable and this has been worked on for years.
The EU business case for Galilleo talks about many many things besides aviation and in fact aviation is notexpected to be a major user in terms of numbers of receivers. This is fundamental to the EU plans for how to pay for Gallleo, which is not entirely clear. Possible avenues are taxes, user fees, encrypted signals that can only be used with a secret code that one pays for etc. And Galilleo is planned to have it's own precise service that is limited government/public interest (i.e. military) that is not necessarily usable by just anyone.
The GPS has never been turned off or wholesale degraded. Yes, it has been and is tested for different things. Ten years ago the US and Russia gave the services of GPS and GLONAS respectively to the world free of direct user fees and stated several years warning would be provided if this was going to be withdrawn. I haven't seen the notice yet.
In the internal US governance of GPS the IGEB (Interagency GPS Executive Board) is no more and is replaced by a National Space Based Positioning NAvigation and Timing Executive Committee supported by a Coordination Office. A friendly blue suiter will continue to do the day to day care and feeding of the system but the policy and the what to do is controlled from the top by this committee and coordiantion office.