Winer on Google+.
That's pretty much all you need to know.
You know what would have been funny? If Google had made invites computationally expensive like BitCoins. That would have shown the world that they were down with the zeitgeist, still l33t masters of algorithms, and still had a sense of humour. Which is what we want from Google. It's their brand.
Instead, this is a public admission that they're scared of Facebook, a reuse of 5 year old tactics, and apparently it's internally driven by an ex-Microsoft middle-manager.
They're just building a bonfire of their credibility here. And preparing to throw all their great products (Gmail, search, YouTube) onto it.