Yes, but PoW doesn't allow to concentrate majority of voters in federal reserve, Washington DC. Because Washington and USA at all - doesn't produce enough electricity to gain majority of network power.

Your PoW (Proof of Witness hehe) allows it without any significant expenses for Big Brother. As he easily manages thousands of IRL puppets. There will be no problem to create and inject thousands virtual "good guys" into community. Photos, IDs, facebook pages - not a problem. Even creation of real life person not a problem.