Up until recent years (and usually including recent years), government arts funding has been directed at art that glorifies and aggrandizes that government. War memorials, the Statue of Liberty, pyramids, WPA murals, etc. Government has shared this role with the Church for a long time. Today corporate advertising follows the same pattern -- fund arts whose purpose is to praise the funder.
In an ideal society where everyone participates freely, arts subsidization would provide art that enobles all. Yep, and eveyone will be happy and loving too.
Censorship is a dangerous course. The test for a functioning democracy should be: "in what way does a censorship actually serve the public?" and such a debate needs to be public and waged publicly in the courts and media. This seizure in Edinburg (eerily similar to the FBI's harrassment of Jock Sturges here in SF) sounds like a fine case of how NOT to manage such issues -- secrecy, denial of process, etc. Public discourse on issues so important that we should ever consider suppressing individual liberties (including artistic ones) must be open to all. OPEN. This is messy and inefficient and exactly what the founders of the US had in mind. This is true for any restriction of liberties which a government might impose for any reason -- to protect us or itself from "enemies foreign & domestic," to protect the innocence of the young or the ignorance of the narrow, or just to generate momentarily-popular votes in some individual politician's district. The bureaucracy of a functioning multipartate government is designed as a check to ambitious power over the people, and is deliberately inefficient because it allows multiple opinions.
The US is currently reviewing a federal law that would make it a crime photograph people "in a situation in which a reasonable person would be justified in that expectation [that the 'improper' image would not be made]." There is a year prison term involved. Amazingly, this law has been working its way up the chain quite silently.
Maybe they will extend its scope to cover photography of foreign detainees.