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Start using the phased cloaking device and you upset the balance of power. If you're planning a preemptive attack and/or you're 100% sure you can hide the tech until you've armed enough ships that the Romulans can't touch you and you're ok. If not, and the Romulans find out youve broken the treaty they would have no choice but to declare war to defeat you while they are still able.
The Romulans did give the Federation access to cloaking tech. The Defiant on DS9 had it, remember?
The Borg are a vast army of slaves. Is it ethical to kill billions and billions of people who are being forced to fight against their will? Maybe, if you don't have any other choice. But Picard and Hugh both proved that a drone could be saved, so there is another choice. A very tough one. It makes for an interesting debate.
One thing that isn't debatable is that if Picard had exterminated the Borg would never have got to see Jeri Ryan's fine ass in that catsuit.
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