If the engineering interview is broken as TFA implies then surely the companies employing these practices will lose out to rival companies. They will be forced to change their hiring culture to be able to identify good programmers. The fact that they have not, testifies to the strengths of the current interviewing culture. It identifies strong programmers from a very large pool of applicants using limited resources. Sure there's a lot of false negatives but that's a much lesser concern than false positives. The alternatives proposed (like doing a project together or looking at past work in Github) are prohibitively expensive to do at scale.

Since this issue comes up so often in HN a reader might think that there's a strong consensus in the tech community about the demerits of the current system. However, that would be a false conclusion. The losers under the current system complain a lot but people who have positive experiences don't feel the need to share their side of the story.