Here you show a very narrow definition of education: a fiscal exchange for a career. However, education also has the role of broaden horizons, create thinkers, develop a space to solve problems that folks have not thought about, or things that one cannot monetize. I refer back to the competing goals I mentioned a couple of times.
Realistically, if a shortcut to a job is all that is needed, the solution is simple. Get rid of education altogether and have corporations set up their own little education enclaves. That way, they can train folks to do exactly what they want.
That, however, does not sound much like education to me.
That sounds to me like yet another goal. Not only be suitable for a career, but better than another. So you are talking about competitiveness, which creates other incentives. To me a good education is supposed to make the student a better version of themselves and not just better than Dave.
INow and I mentioned the complexity of the issue. It is not straightforward in terms of what education is supposed to achieve and therefore metrics are are often imperfect and create incentives that are counterproductive, as I mentioned in my previous post. Just because you measure something, does not mean that you understood the gist of the problem. Finding the right measure is a science in itself.
Public funding of universities tend to keep cost down. I can throw a whole slate of data at it showing how private schools are more expensive and how tuition focused universities (even with partial public funding) are usually more wasteful than publicly funded universities.
One of the reasons is simple and I mentioned those before. There is only a weak incentive to put or keeps bums on a bench (up to a certain degree). Therefore publicly funded universities have much less overhead in terms of recruitment, student services amenities and so on. In countries like USA and Canada which heavily rely on tuition, the ratio between faculty spending (i.e. cost for professors) relative to administration and support services is roughly 60 vs 40% (and typically worse in private schools). Conversely in public funded universities that ratio is about 70% profs to 30% overhead.
In other words, you get more teaching per buck if spend publicly. While there is a "waste" as unsuitable student get into public funded universities, you then have the mentioned weed-out courses which drops the student count over the semesters. In tuition-dependent universities the incentive is to keep the around as long possible regardless of suitability so that they can pay tuition + dorm+ food +gym membership. In other words, it creates incentives that run counter to what folks might consider a good education.
I do not think that loans are a good way to go, but instead I believe that universities should have a steady base-funding that focuses on its core mission, rather than just making students (or their parents) happy in order to get their money.
Edit:
Another piece of information with regard to cost of higher education:
The cost will increase over time relative to regular products as there is a cap on how productivity can be increase in teaching relative to product costs.
Having a lower ratio between students and teachers is therefore going to disproportionately increase cost, even if overhead is kept down. There is a specific economic term for this phenomenon that eludes me presently.
Especially STEM education is therefore expensive and if paid out of pocket, will be prohibitive to low to mid-income families. Public funding is pretty much the only reason why we have an education system rather than education enclaves in the first place.