Not going to one of the "elite" schools is, though, and it's not like financial aid disappeared at all the state schools.
The reputational difference between the state schools and the ivy league has been narrowing a lot in recent years in response to numerous scandals like this and a lot of improvement from the state schools. Is there any reason for the government to step in here, rather than just letting the ivy league continue to destroy its reputation?
And having all these schools’ names be dragged through the mud during the court proceedings will further your goal.
The elite schools are considered "elite" not because they offer a better education, but because they ensure that your classmates will be valuable network contacts after you graduate.
From the perspective of the school, admitting people who are already wealthy/successful is preferable to admitting people who may become successful in the future. The school's status depends on having a disproportionately large population from the former group.
They act this way because the business world works similarly: you are more valuable if you are already on a first-name basis with high-level executives and politicals, because you can listen to the wind and bring your contacts in on the businesses that you are involved in.
All of that is a long-winded rephrasing of the old truism: it's not about what you know, but who you know.
This is how organizations die, political, corporate, non-profit, or any other type. People who are good at knowing other people frequently aren’t the best person for the job, and selecting for newcomers who are good at knowing other people over work leads to aristocrats and manipulative sociopaths taking over, and then you have GE, a company that lost its ability to innovate, could only copy hot trends popular among Wall Street poorly, moved into finance and oil despite having no expertise in these fields to the tune of billion dollar losses, and is now a mess in the process of being broken up and dissolved.
On a much greater scale, Putin’s Russia works a lot like this, which has led it to become an incompetent brutal dictatorship that terrorizes its citizens and also can’t even take over Ukraine, one of the poorest country in Europe and its direct neighbor, because everyone who was competent got pushed out or killed.
Without some kind of intervention that prevents employers using college degrees for employment decisions we’re gonna be here a while.