There are two situations here, which I think people are losing sight of.

The first is that of the private individual. When using your own phone, you should have the expectation of privacy.

The second is that of the employer. When you use their phone, you follow their rules. I know that every time I log into my work provided laptop the login screen says something to the effect of "This is company property, you should have no expectations of privacy when using it". Every time I get a new phone, I sign a form that basically says the same thing.

I have no problems at all with Apple not wanting to put private citizens' privacy at risk. That is how it should be. Keep my private stuff private.

I also have no problems at all with employers (such as the federal government) wanting to be able to see what their employees are doing with their equipment. They shouldn't be sending anything that needs to be encrypted (personally identifiable information, sensitive information) on a basic phone anyway, and at the very least need something similar to the SecuSUITE. They really should have a way to get into the phone, since they are the owners of it.