The more debt students are able to take on the more the colleges and universities can raise their tuition. The colleges and universities then spend lavishly on facilities and amenities to entice prospective customers and their loans.
Students and their parents are partly to blame for the escalation of non-educational amenities. The local flagship state university has on-campus recreational facilities that are better than most country clubs and new dorms that compete with off-campus luxury condos. The “customers” have come to expect these frills and then wonder why tuition and fees are so high.