"Diversity" and the higher education bubble

In Steven Farron's excellent book The Affirmative Action Hoax  he speculates that colleges made ridiculous court  arguments to allow them to apply lower standards to blacks and Hispanics in the name of diversity (e.g., the Bakke case) out of fear that the courts would force them to abandoned achievement tests as the courts have forced employers to do (e.g. the Griggs case).  This means that universities and the military are the only entities in the US that can use g-loaded standardized tests which vary be demographic groups.  This is a huge economic advantage since admittance to a selective college is a reliable and legal method that employers can use to discriminate between applicants.  This is why I do not expect the higher education bubble to pop completely anytime soon.   A cheaper way to do this sorting would be to make junior colleges more selective, e.g., only allowing whites with an IQ higher than 100 to enter while making allowances for blacks and Hispanics.