For centuries, county clerks have recorded land sales and deeds so as to create an objective record of ownership. The rule of law makes commerce and credit (loans against title) possible.
MERS is a new-ish system of electronically recording transfers of titles that bypasses this old system. It is not controlled by the government - it is entirely a private system. The bottom line is that chain of title is no longer entirely clear under this system.
Make up your own mind by reading this in-depth article from the Austin American Statesman.
A very wonky article that critiques some of the legal reasoning behind MERS.
Peruvian economist Hernando de Soto discussing the importance of law in making capitalism possible.