There's this thing, when someone gets strong enough, they start seeing things differently. What the federation does would not be seen as freedom on current Earth, but that is because Earthlings lack the full view and cannot grasp the effect of this situation.
So there was this balloon flying over a certain country in the past week. Another country said it was theirs, then it was shot down. There is another way to understand this. The balloon was a cloaked alien ship. Visual cloaking is not necessarily built into the ships coming here, it's an effect on the human brain imposed by the "prison planet" system. The physical brain does not "see" through the eyes what is actually there. But what about cameras, how can it be then that photos also show a balloon? Cameras were modelled after the human eye, the effect is perfectly replicated in the photo, it's the same structure being depicted, so the cloaking will mask the image just the same. It's not masking the actual photo, it's masking the conceptual understanding of visuals as seen in the brain. The world humans live in is the perfect illusion. That is "the matrix".
Anyway. The balloon was just a placeholder image put there to block the view of the ship. When attacked, the ship moved quickly away while the cloaking image manifested a logical 3D response to the attack. Why not make the ship invisible then, why a balloon? It's because it's not a visual cloaking in the external world, the cloaking is in the brain of each viewer. Recall that scene in Ghost in the Shell - Stand Alone Complex, where the Laughing Man talks to the viewers on TV and places the smiley face in front of his own? He's hacking everyone's cybernetic eyes in real time, so that no one can see his face. He's not making himself invisible, it's just the recording that's changed.
