Government can touch the applications connected to it. And these are the entrance points where money is made. I deed, this is one of the most week points of steem. Put enough illegal content on the blockchain and anyone who is hosting, processing, viewing or - a especially european invention - even 'enabling access to - it, is commiting crimes and/or can be held for damages.
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Only if the application is in an area the government can enter.
And again, it is only an interface to the blockchain...it Steemit got taken down, for example, developers could put up 3 more interfaces on Github to use that could be downloaded by anyone.
The developers can create interfaces quicker than the governments can play merry-go-round trying to take down apps.