alt Hacker NewsMIT makes all its money from research (and investing its endowment more successfully than most schools), not tuition, and the success in research comes from having such a high-achieving community of faculty and graduate students. They're pretty incentivized to keep the bar for academic achievement genuinely high.
To clarify, I am pro-university. I'm just saying that institutions do not always behave in ways that are purely for educational benefit, such as with legacy admissions or grade inflation. I don't think the blame falls solely on students for viewing university degrees as a necessary step for something else. I would sure bet admissions committees will use AI to screen applicants, if they aren't doing so already.