Well, I won't comment on the rather slimy move by the gov't, and their clear lack of ability to stand up for the reasonable privacy of their people... wait I think I just did. However, there is a simple solution to all this -- don't use Facebook. I used to use the site, but deleted my account about 6 months ago (permanently deleted... not just suspended as they do by default), and I've never been happier. I found I didn't like the practices of the sites owners, and it was just a constant drain on my time. I have better things to do with my day then look in on the lives of distant friends / relatives I don't care about.
Anyone that I really consider a close friend doesn't need FB to see what I'm up to, nor do I need it to see what they're doing. If you don't have a FB account... certainly no employer can demand access to it If they ask you for your FB login information you can quite honestly and frankly tell them you don't use the service.
Still, I think that it's supremely slimy for an employer to want this information from you. Just another reason that if you use these social networking sites, you should never post anything of significance on them.