Universities are funded, more or less, for bums on seats. Whether it's paid for by the taxpayers or parents, fees are paid for time present on the premises, It's paid just like day care, but without the Lego.
But what we're paying for - time on campus - isn't what we want to buy. What would happen if Universities were paid for outcomes? What if Universities were paid a balloon payment for each employment outcome, weighted in line with the graduates starting salary.
Suddenly, pointless degrees that are cheap to deliver but go nowhere are a liability and go out the window. Universities fight tooth and nail for the best and brightest that can be placed quickly. They need to be sharp, and make sure they are teaching the skills employers really need. The careers office moves to the centre of the institution, instead of stuffed into a far corner beside Classics. The Alumni network is no longer simply a set of people to shake down for checks - a lead on a good jobfor an undergrad would be worth much more.
Life skills like communication become central, as they greatly enhance the saleability of the student. Even student activities, often funded but ignored, but a key aspect in rounding out a good saleable CV, take on a new importance.
Timing would become critical. If you have a bright girl in second year who could get a good job, should you try to place her, or convince her to stay for another year, to get a better salary. There are options at the bottom too. Taking in disadvantaged students in large numbers, and making them employable might help the bottom line considerably. Outcome payments could be weighted to favour placing disadvantaged students ('fixer uppers' if you will) over easy to place smart kids from good homes.
The institution that would be produced would be as different from the university of today as the shark from the whale, a lean mean beast ruthless in it's hunt for the best careers for it's students. Would I send my daughter there? I might. Would it be a more effective use of taxpayers money? You bet.
In a sense, this happens for research already. Departments and Institutions which fail to turn out demonstrably good outputs tend to find it hard to win grants and sustain their funding down the line. Good results help to win the next grant, and success build on success. There are very few disciples which avoid this and manage to produce large amounts of unneeded research ("I have a little list, they never will be missed") but they are the happy exception.
It's a radical idea, but being radical is not itself a fault. Like most such ideas, the devil is in the details. There are a number of obvious problems, which I shall leave as an exercise for the commenter. But at least it would align what we want - people with useful skills who can find a place in the world, with what we're paying for, and remove the incentive to underfund potentially expensive courses which lead to decent careers, and shortchange important skills, while supporting cheap degrees that shift hundreds of people from lecture hall to exam hall for four years, to no obvious benefit to anyone except keeping them off the unemployment rolls.