Bruce Schneier, someone who has a very deep understanding of the issues and who talks a great deal of sense, calls this sort of thinking "security theatre" - stuff designed to look good and make people feel safe, but that makes no appreciable difference to the risks.
http://www.schneier.com/blog/archive...ism_secur.html
He's right on every point. The actual risk to people from terrorism is tiny - less than from taking a bath, for example. Putting people through the indignities of security does not change that risk at all - if you check for liquids, then a terrorist will use solid explosives. If you lock down air travel, then they'll blow up motorway bridges at rush hour.
The best, sanest and only proportionate response is to say stuff it, and go about our lives efficiently and with dignity. Let the security services do their work, try and create a fairer world where terrorism is obviously pointless, keep 'em peeled... but putting your mouthwash in a plastic bag has got absolutely nothing to do with reality.
R