Most states in the US already have public university systems, but that isn't where most of the debt comes from.
Everyone wants to go to Harvard, Stanford, Princeton, etc.
The competition then switches from spending direct financial resources to the university to spending financial resources to out compete other students vying for the same university. In China there's usually 1 seat per 50 candidates for good university spots, and the only thing that matters is your ranking in the entrance exams. It's not exactly uncommon for high school students to be spending 14 to 19 hours a day 7 days a week for 3 to 4 years preparing academically to win a spot.
Trading one bad situation for another one really.
No need to over complicate things.