It’s just wishful thinking on the part of folks like Yglesias that slapping a college credential on a young person who has little or no academic interest or ability will transform him into a high-earner. We are already scraping the bottom of the barrel to keep mid- and lower-tier colleges and universities full of largely disengaged students who squander four or five years and lots of money while having fun and earning credits in courses with low expectations. Digging down further to enroll more of them will simply waste resources. (But it will keep the education establishment happy.)
Fundamentally, this is the same intellectual mistake as in the “affordable housing” disaster. Left-wing interventionists see something that bothers them (or at least that they think might bother some gullible voters) and they proceed to solve the supposed problem not by doing anything to change the underlying conditions, but by using governmental power to change some manifestation of those conditions.
In the case of housing, poor people usually have to content themselves with rental housing. The underlying condition is the fact of being poor. There are policies that could, in the long-run, help more poor people to become wealthy enough to consider buying a house, but they don’t involve quick-fix activism and are therefore of no interest to politicians. Instead, they choose to order banks to make loans they would not otherwise have made. We now see how well that “solution” worked out.
It’s the same with education. Our K-12 system has a few islands of excellence, but for the most part, children get indifferent to miserable instruction in the skills and knowledge that matter in their early years. They coast along, hearing from their teachers that they’re doing well when in fact they’re learning little. Then, leftist social engineers notice that there is a large earnings gap and conclude that it can be closed by extending the number of years these kids spend in formal education. That won’t work either.