They inflate their prices because, Gov't puts forth loans and grants. But also, you cannot gid rid of a student loan through bankruptcy, like any other loan. So, there is no need for the cost of college to go down, if you can forever go after someone who has a debt.
If a college couldn't get the money, I can guarantee the costs would go down.
Just like health care costs, the problem is that we have health insurance, if there was no insurance, the cost of healthcare would drop instantly.
I have posted this before, but a couple years back I had three stents put in, (Great Doc by the way) the hospital billed Blue Cross about #106,000.00 for that out patient care. Blue Cross paid about $6,000.00 and I was not obliged to pay anything more. figures are my best memory, not exact.