"Multi-factor authentication (also Two-factor authentication, TFA, T-FA or 2FA) is an approach to authentication which requires the presentation of two or more of the three authentication factors: a knowledge factor ("something the user knows"), a possession factor ("something the user has"), and an inherence factor ("something the user is")." Wikipeda

While a username and password are two "things," as you wrote yourself they are both things that you know so they only involve one authentication factor. So even if you required 3 passwords per login, that's still only single-factor authentication.

For the most common 2-factor authentication in place today (e.g. if you enable for Gmail) the authenticating entity sends a code to your device in order to tie this to something that you have (your phone) and thereby introduce the possession factor.

From just a few days ago... http://apple.slashdot.org/story/11/05/02/2120203/OS-X-Crimeware-Kit-Emerges

See also: http://arstechnica.com/apple/news/2010/10/new-java-trojan-attacks-mac-os-x-via-social-networking-sites.ars

There's often great confusion in what free means when discussing free software. When Richard Stallman uses the term free software, he doesn't mean that it necessarily comes free of cost.

From the free software definition: “Free software” is a matter of liberty, not price. To understand the concept, you should think of “free” as in “free speech,” not as in “free beer.” http://www.gnu.org/philosophy/free-sw.html

For instance, the Mozilla Corporation is for-profit (unlike the Mozilla Foundation, which is non-profit), but their software falls under the definition of free because anyone can analyze it, modify it, etc. Similarly, you can analyze, take apart and rebuild your toaster. You might break it in the process, but when you buy it, there is nothing preventing you from taking a screwdriver to it.

The problem is the level of bureaucracy in who gets paid what. Pay raises and promotions in the government are heavily biased toward years in service above actual contributions. The best and the brightest see that they would be getting paid 20, 50 or 100 thousand more in the private sector and that they would have the potential to earn more based on the work they do. So they leave, unless they are extremely loyal or disinterested monetarily. Meanwhile, people who would be making far less in the private sector stay in because of the job security and the fact that they can count on sustained pay raises throughout their career. Granted, this is a vast oversimplification, but in general, technically skilled government employees are paid far too little and given far too little respect, while those who are less technical are generally overpaid compared to the private sector.