But lowering the standards does. And that’s the only way you’re going from a pass rate of a third to 100%. You might be able to double pass rates to two thirds by putting many more resources into teaching but that costs money or comes out of research time/teacher satisfaction. You learning does hurt the top of the class if you’re a marginal student. Students on the verge of failure take up a lot more instructional and administrative time than the top third who were going to get through anyway.

It does though. If a teacher has to teach 50 students instead of 17, that is a huge difference in the amount of attention any given student will have for help. Teachers scale better than some things, but not infinitely.

The most important benefit of a university degree is the credential itself, indicating personal characteristics of the graduate. Lowering standards directly hurts the value of said credential. Learning is a side-effect of the process.