PGP or "Pretty Good Privacy" is a popular encryption package used throughout the world by a wide variety of privacy advocates and enthusiasts. Most people however, seem to not care about PGP at all.
What it is
If you really don't know what PGP is, check out the PGP web site. They do a far better job explaining it than I could ever hope to do.
I have nothing to hide
If you have nothing to hide, then why do you use an envelope rather than a postcard? Why value banks with strong laws protecting the privacy of your information? Fundamentally every person, no matter how few skeletons they may think they have in their closet, has a right to enjoy privacy, in their home, in their records, and in their communication. It is in fact a crime to try to intercept postal mail, a law that helps protect privacy by providing punishments for those who violate it in that manner. Another example is that of a married couple and their sexual life. A normal married couple who are in a monogamous sexual relationship should not have to have their personal sexual lives open to the scrutiny of others. PGP provides a very simple to use method to dramatically increase that privacy.
What about the government
The government is just like any large business in many ways. There are good people in it, there are bad people in it, but most importantly, there are people in it. The United States values privacy, especially from the government. That is why we have laws restricting government searches embedded in our constitution. PGP provides a guarantee, a protection to ensure that your privacy is not casually violated.
Not just for privacy
PGP doesn't just act as the envelope around a message. It can also be used as a signature at the bottom of a message. In today's world, someone pretending to be someone else can have devastating consequences. People can have their careers destroyed, their identities stolen, even be saddled with massive debt. One of the most common uses of PGP is to authenticate the author and integrity of a message.
Crucial for business
Businesses rely heavily on the ability to authenticate themselves to potential customers as well as to authenticate potential customers as serious buyers. PGP provides cryptographic authentication, but while the concept of PGP is new, the importance of knowing who one is dealing with is a very old idea in business. PGP authentication helps by providing a way to authenticate two parties that may not deal with each other on a regular basis.
What does that last mean? Basically, it's like the medieval practice of sealing a scroll with your personal seal. The recipient of the scroll, as long as the seal was intact, knew that the owner of the seal had penned the message and that the message was unchanged. PGP provides even stronger protection by allowing people to view the contents without "breaking the seal".