Honest question: why is it terrible? I would assume that if someone is capable enough to struggle for 2 years, they stand a real chance to struggle for 4 years and graduate. And seeing how the job market rewards a mediocre diploma from a good college significantly more than a good diploma from a mediocre college, it seems like a very rational decision from the student's side. And if they do fail out, they should still be able to enroll in another program, and presumably get a decent grade there, no?

>Having students struggle for two years in a program they're going to fail out of is terrible.

Putting a body every a seat for those profitable 500-person lectures taught by an adjunct and graded by TAs who are all paid peanuts and then having them wash out before those expensive 50-person high level classes and esoteric electives taught by tenured profs and accompanied by lots of expensive lab time is great for the university's bottom line though.

Agreed. I've seen some interesting data that kids who could've been successful premeds or engineers at their state flagship but instead eke their way into Harvard or Princeton (sports scholarship, legacy etc) will instead graduate with a flaky studies major because they couldn't cut it in their intended major and the switching costs of transferring were too high.

There are downsides if you end up a small fish in a big pond.