Almost every industry, including tech, relies heavily on those things as pre-interview filters. Tech is not a meritocratic exception here.
My SO works in media and I can assure you the hiring process there is completely, thoroughly, perniciously subjective. Experiencing her job search really gave me appreciation for the fact that taking a test is 80% of my interview process.
The big tech firms are notorious for the same thing with a slightly different set of high-prestige schools, so I don't know what difference you are trying to draw?
I just did a quick check in LinkedIn, choosing four people at GS with "Trader" in their title. The four schools I got: UNC Chapel Hill; Duke; Williams College; Amherst College. I find that distribution hard to correlate with your statement.
"The only difference now is that you'll constantly have an ethical and deontological loop running in your head."
As an licensed Engineer (once again, PE in most jurisdictions, Quebec just can't agree on using the same terms as everyone else), you have an ethical, deontological and legal obligation to ensure that your work conforms to the "state of the art". You constantly have to think about the consequences of your work on everyone downstream, from workers on the shop floor, to the final customers, maintenance workers, etc.
It's not so much about the actual work (many drafters, technologists, etc could often do something an engineer has done), but about the profound care that went into making sure it was right.
In this instance if I were John I probably wouldn't want to work for the company anyways because they clearly have no idea how to hire.
This is why I get a laugh out of people complaining about whiteboard-style interviews. Far and away tech still has one of the most intensely meritocratic hiring processes. Not perfect, sure, but better than almost every other industry. The majority of high-skilled jobs rely heavily on pedigree, education, social standing, references, sociability, etc. I'd much rather reject Linus for flubbing a BFS traversal than hire him for attending my Alma Matter and knowing a lot about golf.