In my (albeit anecdotal) experience, incompetence is the norm rather than an outlier in BigCo SV land.

Frankly, if you are more qualified for a position, chances are you will be rejected because your interviewers will fear for their own job security.

I've always found that type of logic strange, though. Wouldn't you want someone who was better than you currently are on your team? Wouldn't you be able to learn from them?

That only applies if you want to learn. If you just want to coast and be "the best" at something at your company, you dont look for people better than you. At best you look for people that are better at the tech than you, but who are passive or easily browbeat so you can claim their work as your own.

That depends on if the interview process actually does protect from bad hires.

It happens all the time Google acquires a new company, those employees aren't going through these crazy interview processes.

actually, acquisitions normally trigger full interviews- see "Chaos Monkeys" for a description how this happened at Twitter/Facebook.

Is this an US thing?

I went through three acquisitions and never had any interview, besides the set of meetings for each of us to decide to go along with the acquisition or get a severance package.

I think it all depends on the requirements of the company doing the acquisition. I've gone through several myself and did not have to re-interview however I have heard of a employees claiming Google required them to re-interview which has got to be nerve racking considering Google's heavy focus on avoiding false positives a lot of good people don't pass them.