Ultimately, we live in a pretty free agent society and if Wall St can pay more (no matter the reason), the rational engineer whose primary motivation is money should take that job. There is nothing wrong with that. The engineer who is motivated by money and other factors (building something valuable, being his/her own boss, etc) also has avenues a la doing a startup.
If the financial industry had actually had to bear the consequences of the risks they take in the same way that entrepreneurs do, the decisions would be rational. As it is, the finance sector is protected by the government whereas startups are not.
Merely commenting on your point as to why the "finance sector is protected by the government whereas startups are not".
If you don't seriously expect Facebook to get bailed out it's not a particularly meaningful thing to bring up.
But nevertheless, I'll go back to my original point. If the gov't thought that Facebook (or any startup) presented systemic risk, it'd likely get bailed out. I'll leave it at that.
I believe that there's a systemic problem with the industry and its role in society and that it is damaging our future prosperity.
Yes, any sufficiently powerful institution could, in principle pose such a problem, but why distract ourselves with imaginary problems when we have a real one sitting in front of us?