"ISIS and the terrorist networks can't beat us militarily, but they are really trying to use the Internet and all of the social media to try to intimidate and beat us psychologically,"
No they are winning psychologically by inciting these kinds of reactions from our government officials. Some are moved by stupidity, but most are enticed by aligned interests. "Terror" gives value to the currency of safety. Government's ability to provide more safety relies on control. Control is power, and unfortunately most of our elected officials seem addicted to it.
Terrorists aren't beating us militarily, they don't have to. All they need to do is keep handing us things to be afraid of, because our government is an enormously efficient factory for turning fear into the erosion of personal freedom.