Rarely profit. But it goes towards higher salaries, larger administrations, financial aid, and various amenities that today's college-bound kids' parents demand

Rarely profit. But it goes towards higher salaries, larger administrations, financial aid, and various amenities that today's college-bound kids' parents demand, like comfortable dorms, gyms, etc. College in the 80s didn't look much like college today. For many schools, the actual cost the average student pays has not changed as much as the sticker price. One reason is that some colleges discovered they could price discriminate: by charging $XXk/yr as the sticker price, they could let in some fraction of students who can afford to pay full fare, and use that money to offer financial aid to the students they want to attract but who can't pay full fare. Another reason is that basically no college competes on being less expensive, because that might imply that they're not "worth it".