I left a lucrative and successful career in IT 5 years ago to pursue my PhD because I wanted to research and teach in academia. I have met many other students who left lucrative positions to come back to school. Universally all these students understand that this career choice is not about the money, it is about lifestyle. The academic tenure-track job market is fiercely competitive and can be brutal. The tenure process is tough for young faculty members. Ultimately, a doctorate is for those who are passionate about pursuing high-quality, highly technical or theoretical research (either in academia, the government, or private industry) or for those who have a passion to teach at the university level.
I'm fortunate to have secured a tenure-track position at a research institution starting this autumn. The salary I'll be making will be considerably less than what I would have been making, not to mention the 5 years of not making a decent salary. The ability to continue pursuing my research agenda, collaborate with incredibly bright colleagues of my choosing, work more flexible hours than in my previous jobs, create and develop courses for undergrad and grad students which may have an enormous impact in their careers, and spend more time with my wife and kids makes me very happy with the "value" I'll be getting out of the time and effort it took to pursue a PhD.
This would seem to be an argument for students not to enter PhD programs—if their labor is undervalued, they're better off going into industry than getting advanced degrees in academia. It's certainly true that the current system works reasonably well for universities, but I think both "The PhD Factory" and "What is a Phd really worth?" are targeting people thinking about grad school.
I'd observe one other thing: a lot of undergrads might be getting what's paid for. That's one reason I wrote How Universities Work, or: What I Wish I’d Known Freshman Year: A Guide to American University Life for the Uninitiated (http://jseliger.com/2010/09/26/how-universities-work-or-what...), as freshmen and sophomores often don't understand what grad students and profs are actually rewarded for.