This sounds like something like the tragedy of the commons or Gresham's Law for academia. It's in everyone's best interest to do take advantage of the system, at least as long as there's public support for academia.

I don't see the situation getting much better. Republicans like free-market solutions, but not facing market constraints is part of the value of academia. Meanwhile, especially with consternation around student debt, Democrats will blindly support academia, failing to put any pressure on it.