Here's another perspective.

Let's say Harvard's admission were to become largely based on social status rather than merit. You could say "so be it", but let it be known that that is what Harvard is. Being one thing while advertising another is lying and the greatest offense.

A positive side effect is that perhaps we won't fetishize Harvard as much and keep insisting that one must get into Harvard. You don't. Harvard's brand depends on you thinking you do, of course.

The current model of academia in the US and elsewhere is wretched. Obscene tuition is one thing. The failure to educate is another. Universities got out of the education business a while ago. Universities are focused on jobs, that's the advertising pitch, which is not the historical and proper mission of the university. So you end up with institutions that are bad at both.

So if these "elite" schools lead to a disenchantment with merit, I see a silver lining. It could provide the needed impetus and motivation to distribute education more widely in smaller colleges with a greater clarity and focus on their proper mission (e.g., Thomas Aquinas College [0]) while creating a robust culture of trade schools. The majority of people do not need a college education! And frankly, it's not what they're looking for.

Germany does something like this. Fewer people go to university there, and they have a well-developed system of trade schools.

Furthermore, you could offer programs that allow students at colleges to take classes in these trade schools.

Let's stop trying to sustain a broken model. The time is ripe for educational reform.

[0] https://www.thomasaquinas.edu/

This would sort of work except that Harvard already built an endowment of $50 billion based on all that lying. Unless you're going to claw back that money, you're just letting them pull the ladder up behind them.

If as you hypothesise universities are focussed on jobs, how do you explain the countless utterly useless degrees they keep pumping out en mass?