Libraries are involved with patron's personal information, we all know that. We know who has what book checked out, and in many system there is a record of who has read what, used which computer, etc. Even when there are no physical records, this information can still exist in the form of logs, computer related information that is carried over for a period of time (cookies, etc.), and when books are checked out of a State libraries the records may exist outside the library where the materials were accessed even if that library does not keep records itself once the materials have been returned. It's just a fact of life.
There are laws in place to protect us, the public, from abuse of those in power when it comes to these records. And, while they are certainly not perfect, from from so since 2001, they are still the law, and this is a land of law and order based on those laws - or so we are told. In certain circumstances, people in positions of authority know that if they use their influence to coerce members of the public to abandon their rights, they will often get compliance despite their request being illegal. It happens all the time.
This story explains how this situation came to pass in a library - a situation revolving around the USA PATRIOT act, or so the people in question were told. FBI agents came into the library, asked to see records without a court order (which is required, even under the so called PATRIOT act), and fortunately in this case, the librarian they were questioning knew something of his rights and refused them. According to this article, this sort of illegal action by the FBI has happened over 1000 times.
The article then reviews the court actions that culminated in the Supreme Court ruling that the entire security letter provision of the PATRIOT act was unconstitutional and therefore invalid. The Bush administration has appealed the decision and at the time of this writing there has been no further ruling on this case. The idea that people will forfeit their rights under pressure is something that we should all be concerned about - it affects us all. If enough people forfeit their rights enough times, it will be very easy to adjust the laws to compensate and we will all lose those rights without a fight. We must all be aware and on guard at all times for abuse.
Wikipedia's page on the act, which may give an alternate point, or points, of view
The ACLU's page on the act