(a) isn't unreasonable, and all professors at places at SIUC have heard and made plenty of complaints about the strategy of making college accessible to all by letting everyone in to college only to have many of them fail. 12 years of decent education, culminating in a high-school education that goes beyond mere job training (but includes that), could well be enough. But I don't know if this ideal is still practicable given the increasingly high-tech workplace out there and the chronic problems facing our K-12 educational system.
(b) I can't comment on, as I, like many readers of this blog, have taken a blood vow to remain silent about my fealty to Our Great Master. But Santorum's remarks do lend a certain weight to those arguing that we ought to change the name of the College of Liberal Arts, lest it be taken for a College of the Dark Arts by a certain sector of the population.
Obama's policy is rather more rational. It is certainly reasonable for the federal government to start concerning itself not only with providing financial aid to get students into college but with making sure that they (a) graduate from college; (b) aren't forced to pay too much for college (on college costs, however, recall this contrarian view); and (c) get a decent enough job to pay back their college loans. But the problems with the performance based approach are clear enough. We demand that colleges admit everyone (for everyone should get a college degree, right?); we demand that they graduate everyone; we demand that they do so in a timely and economical way. It's not hard to conclude that the only practical way of meeting all these objectives is to become a diploma mill.
My fear is that we are starting to make the same sort of demands of colleges that we've long made of the K-12 system: they are to cure all of society's woes. Just as no public-school system can be expected to transform a dysfunctional neighborhood, so too no university system is going to be able to take ill-prepared students and turn them into economic gold in four years, on the cheap. While the government has every right to ask universities to be more efficient, incessant criticism and unrealistic demands could end up reducing the public higher ed system to the status of the public K-12 system, which is so routinely (if unfairly) regarded as a uniform failure. Add the ideological attacks of a Santorum, and we'll get homeschooled PhDs in, say, creation science.