Well...take a look at all the money going into higher education. It has not equaled more higher education, just more expensive higher education.
OK, so if we take 10,000 kids crammed into a little red schoolhouse and build a 10,000 university campus with a $10 Billion investment we haven't increased the supply because no more kids are in school? Please.
Not all of the increase is in State Universities. ITT Tech institutes and online universities and other nontraditional educational establishments have sprung up to get in on some of the hugh and series money the Feds throw at "higher education". Those places turn a profit compared to investment that would make Exxon-Mobil blush.