"Education" is not an investment. College is a joke, professors teach at the dumbest common denominator which in my experience is typically those on welfare, getting a free ride with money stolen from the productive class. Your co-workers students loans are as much an "investment" as the car loan, likely less so as at least the car loan is for an asset that has value and can be sold. Bottom line is if you can't pay cash, you can't afford it. Both are luxuries and indulgences.
That's going to depend a great deal on the college and the major. While it does seem that some college students are likely coming out no smarter than my older sisters came out of high school (and a lot lazier), that's not the case everywhere.
You'd be hard pressed to get a decent engineering job without an engineering degree. Quality of program varies, and quality of student varies...but I'd wager the students coming out of top-10 schools are going to be okay. And the degree was probably worth it.
The university local to me now has a decent engineering program - it is, however, somewhat large. I was quite surprised to interview one young fellow with a degree in EE. A former classmate of his said "I wouldn't recommend him". Prior to the interview, the boss and I figured - he has a degree, how bad can he be? Well, we figured it out pretty quickly. The guy wasn't able to answer the simplest questions from his degree...and we wonder how he even managed a C average.
Back to the OP - I am definitely with you here. Maybe it's not sexy anymore - back in the dark ages, when I was a fresh college grad and freshly-minted Naval officer, I had both a car payment and college loan payments. It never occurred to me to spend more on the car than the college loans. The car was $6700 and the loans were $11,000. I did pay the car off first (3 years), but the college loans weren't long after (4 years). The spare money I had went to the loans.
Likewise, as a child things like health care (not insurance, we didn't always have insurance) came before things like cable TV, computers, etc.
Personal responsibility is tough. It's why I always see things as shades of gray. A friend recently complained on FB that the reason why small business owners hate Obamacare is that their costs are going up and up. I understand her point. Her premiums (she's single and over 40) are higher than her mortgage, for a silver plan with a $6k deductible.
But I also have friends who were "uninsurable" before the ACA simply because they moved states (same ins co would not cover them in the new state). I have friends who got laid off in their 50s (you know, after working 30 years), and now they are unemployable and uninsurable.
There are honestly people who work hard, and struggle, and can't pay off their college loans. And then there are people like this girl who could stand a little self-reflection.