It looks like the U.S. is going ahead with the plans to embed RFID chips with biometric info on passports, despite lingering concerns about security and privacy. From the Financial Times:
But civil liberties and privacy groups are uneasy about the formation of biometric information databases on US citizens and concerned that identity-theft rings, foreign government agents or even terrorist groups could "skim" information from the RFID chips or "eavesdrop" on the communication between official readers and the microchips.
Last month, security concerns about the new passports arose anew after a Dutch television programme detailed how, in July 2005, the Dutch security laboratory Riscure successfully penetrated the encryption scheme planned for use in forthcoming Dutch electronic passports.
Count me among those who think this is cause for concern. Give hackers something this juicy to hack, and they will, just because they can, if not for nefarious reasons. I wish I had a better answer to propose, but I don't. If you do, I'd love to hear it.