No, GSM voice is not encrypted. It is an option, but I am unaware of any carrier in North America that has enabled the feature.
GSM and CDMA calls are digital however, so the type of equipment required to listen in is highly specialized.
As for government taps, yes all phone calls are tapped in some way shape or form.
The news article above was about civilians having the ability to do what governments have been able to do for some time.
Just do not let your cell phone get out of sight...