I'm a big believer higher education needs a massive makeover.
First, state schools need to be funded by the state with the... requirement... that they serve in-state students. This means they go back to being truly inexpensive because taxpayers are willing to recognize the need and benefit for an educated cohort of society. Drop the debt load significantly, 90% of costs covered, but raise admission standards by lowering acceptances at these schools. Slots should be available for the top 20-25% of h.s. graduates in any state. For perspective, that's about 50K slots per year in New York across all state schools for 4 years.
If you are in a state that doesn't value education (and yes, I live in AL so we would have to move), your state schools are probably going to be underfunded. Huge classrooms, mediocre education. Vote for someone better, or move. But you can't go to a state school out of state. What the heck is the purpose of a state school that mostly serves out of state students.... looking at you University of Roll Tide and the 68% out of state undergraduate enrollment.
Second, if you don't have the h.s. qualifications, anyone top 50% of their state h.s. class can go to a JUCO for a few years, also 90% covered. Any student with a 3.0 or better in a JUCO degree can go to a state school if they want to finish a 4yr degree. Same 90% paid for status. Students have some skin in the game, have legitimate known requirements, and can receive an education even if you are a late bloomer so long as you are willing to put in the work. Anyone below the top 50% of your class... well, only about 62% of h.s. graduates go to college anyway.
If you can't get in the top 50% of your state... you are going to have to find another way. For example, anyone with 2yrs of public service (military) and a recommendation or 2yrs of government approved service (Peace Corps for one possible example) can go to the JUCO program if they didn't qualify after h.s.
Third, if you don't finish your degree, either JUCO or 4 year, you have to pay back a percentage of the benefit you received. 15% in year one, not much if you recognize early college is not for you, 30% in year two, 50% in year three. Again, skin in the game. Finish your darn degree. If you drop out after year 1, it won't be that much, but if you drop 3 years in, that needs to be... discouraged.
Fourth, state schools focus on vocational degrees. Engineering, computer science, business, the hard sciences, healthcare. There are dozens more, but if you want to focus on theology, ancient Greek, history, etc... then you will need to pay for it (see Private Schools).
Fifth, private schools are more market based, let that continue. Maybe they cater to that lower 50%, maybe they offer an education radically better than the state schools and are worth the money. Maybe they offer degrees that state schools don't (liberal arts). Maybe they offer sports that the state schools don't. Lots of ways to differentiate, but probably nowhere near enough to keep all these hundreds upon hundreds of schools. If they can survive, and I suspect many won't, then they add to the market.
Finally, the job market needs to change. So many jobs require a college degree for a job that doesn't need a college degree. They do it because we have so many college graduates, not because it actually adds to anything. Reset those expectations and qualifications and fewer students will feel the need to go to college. Follow a pattern similar to what I laid out above, and people most likely to benefit from college won't come out with crippling debt loads. Obviously this is just a sketch outline that has massive holes that need cleaning up, but short of going away from traditional college experiences, this makes the most sense to me.
