It is one thing to say "there's something wrong here"....and quite another to be able to say exactly what is wrong.

Now, for the life of me, I can't find a specific code section that addresses this pic.

I have seen such lampholders designed for such a "hanging" application. Indeed, they once were quite common in homes....of course, this goes back some time.
I have seen the code require guarding the bulb when used as temporary lighting, but I don't think this is temporary.
We're certainly not in a clothes closet here, nor are 'readily flammable materiels' near the bulb. I don't even see discoliration on that pipe insulation.

Sure, I'd LIKE to see better lighting- but just hwere is the NEC violated?