The rule for assumption is that if the assumption is reversed (also called "flip it"), the conclusion doesn't hold.
The argument basically says that since Americans don't use driving licenses for any purposes other than identification for driving, the usage of such licenses for other identification is "un-american". Ask yourself that what would the author have to assume for this to hold good? From the answer choices, flip all the choices and see whether this argument can be nullified. Lets see-
A says The next presidential election will be dishonest, as has happened in eastern European countries. The flipped version would say "The next presidential election will NOT be dishonest, as has happened in eastern European countries". Since this has no bearing on the argument, we can easily eliminate this one.
The flipped version of B says "The government will NOT soon start curtailing the activities of those it considers "dissidents."" Does this somehow affect the identification is 'un-American' argument? No. So eliminate this one too.
Flipped C : "Blanket restrictions on law-abiding individuals are NOT contrary to the traditions of American culture and law." CORRECT. If Blanket restrictions on law abiding individuals were NOT contrary to the traditions of the American culture and law, the author couldn't have concluded that the usage of driving licenses for identification purposes other than driving is "un-american" and so the argument would NOT hold. So this is the answer!!
Flipped D: The majority of Americans are willing to give up their right to travel and move about without identification. (In order to flip sentences that have a Not, remove the NOT). Even if the majority of Americans are willing to give up their right to travel without identification, it has no bearing whether the usage of driving licenses for identification purposes other than driving is "Un-American". So this CANNOT be the answer!
Flipped E: Americans should NOT resist all government regulation of their lives. No bearing, so eliminate this too.
My Answer: C