No one knows exactly where the original quotation, "When government fears the people, there is liberty. When the people fear the government, there is tyranny." comes from, but it was most likely from a series of debates on socialism in 1914, in which John Basil Barnhill uttered, "Where the people fear the government you have tyranny. Where the government fears the people you have liberty."
Whatever the case, whoever said it spoke the damn truth.