So when the Iowa State Telemarketers call for donations for scholarships then I should just say "NO". Because if I make a donation providing scholarships or even belong to groups that give out scholarships, the additional money will end up just hurting the students. I got that right, didn't I?
No, but you never really do in subjects like these. There's a huge difference between privately funding private scholarships and governmental funding school and making it a "right." Once you make it a right, then the government has an obligation to fund it. Once the government has an obligation to fund it, there's no incentive for anyone to analyze the feasibility of what they're going to do.
Again, how we pay for it isn't a problem, it's a symptom if you think education costs are too high. Figuring out how to reduce costs in education and healthcare are hard, though, and people don't really want to think about it.