There is a big push for all training of any type to be delivered by a TAFE (Technical and Further Education) institute. Scouts Queensland is now a registered TAFE so that their training is recognized by external bodies. My Celebrancy training came from a TAFE, as did my first aid (Even though that TAFE was the Queensland State Ambulance Service).
The biggest problem with the system is that the requirements for testing are TERRIBLE. Certain requirements have to be met so questions are constructed to meet them. Multiple choice is rife, as is simply posing the requirement as a question. They're badly written. I had to submit an assignment along the lines of "Describe your attitudes towards the values and commitments of marriage" with no further instructions. No guide to length or format or whether having the "wrong" attitude would fail me. This is a very common experience.
There's also a lack of importance attached to correctness. If you fail, you get to try again, with no penalties, until the end of the semester. Your only possible marks are "Competent" and "Not Yet Competent". It's very common for material to be wildly out of date or simply incorrect.
The end result of all of this is that TAFE is generally seen as a joke AND a requirement for many skills and certificates.
If there were an overabundance of available skilled plumbers in every community, the wages might drop.
Needless to say, in any given US community there is often a shortage of available skilled plumbers but rarely a shortage of young people with college degrees.
PayPal, Thiel's claim to fame, had one competitor: X.com. And they merged.
Even though the university experience might not have a monetary "return on investment", he chose to pursue it.
Now, it's also worth noting he's on scholarship. Whether that was the deciding factor in his choice to attend we cannot be sure just from what you've told us.
But nontheless he is investing his time at the university when he could be doing plumbing jobs and making money (or, by analogy, working on a startup that a certain VC has an interest in).
Some people just aren't meant to be academics, and that's fine. They will never excel at school. So let's teach them something that is useful to society like plumbing or electrical of HVAC.
And now for an anecdote: I was paying a plumber for a job once, and after I handed him $1000 for the 4 hours of work he had done, he told me that his kid (who had been his apprentice for the job) was in college on a sports scholarship, but planned on taking over the family plumbing business upon graduation because it was far more lucrative than anything he'd be able to get with his college degree in humanities.