David Leonhardt suggests that “cost is not the main problem for American higher education,” yet he also writes that:

The patchy — and often shoddy — quality of education at many high schools and colleges is a major problem.
It’s also a problem that we don’t know which colleges are doing a good job and which are not.

If we don’t know which colleges are doing a good job or not, and if the higher education landscape is plagued by shoddy instruction, I’d say cost is definitely a problem. That is, even if the “vast majority of students attend public colleges that cost far less than elite private colleges or even than many flagship state universities,” something that’s obvious to a casual observer, it is possible that students are overpaying not only in cash terms but also in opportunity cost, even if we leave aside the cost to taxpayers.

One straightforward strategy for tackling the interrelated tangle of problems facing higher education is to rely more heavily on for-profit instruction. Judith Scott-Clayton, drawing on a terrific new study from the Center for American Progress, writes:

Why? Because for-profit institutions, facing the pressures of a competitive market and unburdened by decades (or centuries) of accumulated bureaucracies and multiplying missions, have stronger incentives and greater flexibility to innovate than traditional universities. “Business models do not evolve easily,” Mr. Christensen and his co-authors note. “In biological evolution, individual organisms do not evolve. They are born, and they die.” Similarly, they add, “business units rarely evolve” — and corporations often evolve “by opening and closing business units” (p. 20).
If policy makers want public institutions to innovate, the Christensen model suggests that financial incentives (like linking state or federal subsidies to student outcomes) may be a necessary, but insufficient condition. Public systems may also want to encourage the development of entirely new units, as some are beginning to do. Indiana has partnered with a private online college, Western Governors University, to establish WGU Indiana, a nonprofit online institution with a public mission. In 2012, the City University of New York is planning to open a new community college, built from the ground up with a laser focus on student success.
Of all the potential merits of for-profit colleges, perhaps the most useful is simply the role they serve in upsetting the status quo. Critics have raised legitimate questions about these colleges’ institutional practices, program quality and return-on-investment. We now ought to acknowledge that these questions should be answered for all college students, not just the small fraction at for-profit schools. [Emphasis added.]

I particularly appreciate Scott-Clayton’s last point for obvious reasons.