This is the result of NIMBY, but for education. Same as the housing market - once you're in it, you're invested in housing prices not going down (and certainly not build-build-build as we should be doing).
What we should have done is expand access to elite colleges commensurate with demand, and thereby dilute the status of the "elite" college. Harvard still accepts ~2000 people, around the same as 40 years ago, even though demand has skyrocketed. That is basically leading to more and more competition over the same slots, same as the bidding wars in the housing market. And all of the alumni of the University get to ride the wave of more and more exclusivity (they benefit from a low acceptance rate), so this is unlikely to change.
What we should have done is expand access to elite colleges commensurate with demand, and thereby dilute the status of the "elite" college. Harvard still accepts ~2000 people, around the same as 40 years ago, even though demand has skyrocketed. That is basically leading to more and more competition over the same slots, same as the bidding wars in the housing market. And all of the alumni of the University get to ride the wave of more and more exclusivity (they benefit from a low acceptance rate), so this is unlikely to change.
Artificial scarcity rules the day.