Then why are students asked to bear the $100k cost individually? Kinda hard to justify that level of self sacrifice from anyone.
The reason is that ramping up aggregate private debt has a number of advantages to the following two groups:
* Large employers would like to see the bargaining power of their employees curtailed. You'll be much more fearful of quitting your job or demanding a raise if you fear spiraling compound interest.
* High finance (investment banks, hedge funds, etc.) because they can often figure out a way of being paid to administer debts and use it as fodder for high profit gambling activities (derivatives, etc.).
An ancillary reason is that ramping up private debt is a way to give a quick economic and employment boost because it usually increases aggregate spending. The public can be boiled like a frog.