Schmidt gets lambasted by the media every time he says something pragmatic about Google's services. I respect him for sticking to his guns. Here is a quote from Schmidt about Google Search that he got crucified for two years ago:

Judgement matters... If you have something that you don't want anyone to know, maybe you shouldn't be doing it in the first place... If you really need that kind of privacy, the reality is that search engines - including Google - do retain this information for some time and it's important, for example, that we are all subject in the United States to the Patriot Act and it is possible that all that information could be made available to the authorities.

What he said two years ago about Google Search, and what he is trying to say now about Google+, is that these services are not for those with high security and privacy needs. And he's right; they aren't. As a US company, Google must conform to US law. This means Google must store certain information and under various circumstances provide the police and the government with said information. You really think Google+ allowing you to use a pseudonym would then make it ok for use by those with strong anonymity requirements? Absolutely not.

EDIT: Please see jrockway's comment for a correction. Google is not legally required in the US to store information; still, they are in the EU. In any case, they are legally required to provide information they do have in many situations. Google chooses to retain some information in order to produce a more competitive product. This is how Google chooses to do business and it would be silly for those with strong anonymity requirements to use Google's services.