It's both. There was an education funding crisis because of declining funding and increased enrollment. This led directly to predatory non dischargeable loans.

I'm utterly convinced it's all the aftermath of our extremely large boomer generation that began voting against education funding as soon as they graduated. For decades state schools were mostly funded by the government as they are in most other countries. Dependence on loans is new and pretty unique to the US. I really see it as the old stealing from the young in this case.