the panopticon works; people do what is measured and don't do what is not observed. unless, of course, they are deviant-minded and then it is just the opposite.
the bottom line is that people do mind when they know they are being watched; this is how the collective conscience works. with the diversity of groups, the collective conscience is now going high-tech -- surveillance cameras, wire-tapping, videotaping, etc.
we think we are so smart and so free...