University of Iowa is a very good school, no doubt. But depending on what you want to do with your life, it can close a lot of doors. Top-tier banks and management consulting companies don't recruit heavily from U of I, nor do top-tier tech companies for that matter (though the distinction is less marked). When you look at the fraction of the upper echelons of corporate America that come from those backgrounds, that's significant. I went to a state school for undergrad, but where I currently work most people have at least one Ivy on their resume. The difference in our undergraduate social networks is really quite dramatic in terms of peoples' career trajectories.
What's a 'top tier tech company'? When I went to school at Penn State, we had Amazon, MS, Google, Cisco, Intel, Oracle, etc. all come to our career fair. It's not like quality graduates had trouble finding excellent jobs.
I had a roommate who ended up at JPMorgan, and a few more distant associates really hit the jackpot in the Oil and Gas industry.
I will agree that if your life goal is a 100/hr a week investment banking position or some top tier management consulting position in NYC then a big state school probably isn't where you want to be. But you can't study petroleum engineering at Yale so it works both ways.
Coming to a career fair is quite a bit different than coming to a school expecting to hire tons of people from there. Lots of companies go to career fairs at certain schools looking to pick off the very tippy-top kids, but they go to Stanford, Harvard, etc, looking to really fill their class. JPM doesn't care if it doesn't pick up anyone at UNC in a given year. It'd be a disaster to the recruiting people if they didn't pick up anyone at Wharton in a given year.
Of course you're right, these companies aren't the beginning and end of the great jobs available to college grads. If you have zero interest in these jobs, going to the most elite schools is much less important. At the same time, there is a reason a quarter of MIT grads end up in finance and consulting (pre-recession, it was a third). For better or worse, they offer relatively low-risk paths into the upper echelons of corporate America.
On the other hand, a student who does well at U of I can absolutely get into the elite schools for grad school, at which point they become part of the club. It’s one more step, but the doors aren’t closed.
I would also argue that state school graduates have a different concept of what they want out of life. In general my social circle had more people who were comfortable in more traditional career paths such as accounting, actuarial, engineering, finance, teaching, etc.
Balancing a comfortable income and having a life were more important than striking it rich at all costs.
