This is also what a lot of other countries do so it's consistent with "the way things are done".
Finally, it seems politically expedient. There are already provisions for prioritizing Masters degrees. This change is a modification of those provisions. That (crucially) doesn't have to go anywhere near the legislature.
These particular masses are not huddled. Nor are they all leading lights (though some will grow into greatness in time) . So there are also plenty of reasonable arguments against this approach.
As an expat for the bigger part of my life I can't think of a country that would prioritize their own institutions when applying for a visa. Generally there's simply a category for advanced degree holders.
Just imagine a PhD (or even a Master's degree holder) from Europe, a leader in their field. With this system they are at a huge disadvantage and so are companies that would like to hire them.
As someone mentioned this system will just lead to straight to masters degrees. Those "body shop" outsourcing companies just need their candidates to attend any (does online count?) US-based masters degree and then business as usual.
Having a Masters from "some" university doesn't make anyone highly skilled.
In that sense every f1 student filing for h1b transfer of status in my opinion acting in bad faith. The case about already here makes no sense as many other visa categories loke r2 or h4 are not allowed to work despite having spent years in usa.