On the question of how problematic it is that you typically need some kind of an "in" to get a job, I think you need to distinguish between some different cases of connections. After all, a lot of the people I know are people I got to know through work. If you get in touch with someone because you're working in the same field and admire/respect each other work, and that becomes a semi-social relationship, it doesn't seem at all problematic for that kind of "in" to perhaps pay off in work terms down the road. The only alternative would be for people to deliberately avoid social interaction with people whose work they admire.
Still, I think Peter Suderman is understating the scope of the problem, particularly in fields without clear metrics of quality. People obtain positions of some power/influence/whatever and then use those positions to build, in effect, patronage networks wherein they get to hand out favors to friends and hope that the ability to hand out favors will help shield then from critical scrutiny. I think a lot of journalism needs to be understood in this vein.
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