Without real names, Facebook would be as junky as Myspace was.
Doubly so given how granular the controls are regarding who can see what. Sharing on Facebook is a completely opt-in process, so if you don't want your boss seing your pictures, you have a litany of options, including lists, person-to-person sharing, blocking, and not friending them in the first place.
The problem is that this requires a modicum of effort, and people don't want to have to expend that effort. They want to be able to blast everything out there and just kinda hope that it doesn't get them in trouble. It takes effort to use stuff that's not Facebook.
Citation needed.