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> So, if (or, perhaps, when) all the people with liberal arts degrees go back to Javaschool and emerge in a couple of years with M.S. degrees in CS, is your company going to hire them all?

This argument is not terribly relevant. It's like I tell you about this cheap, underrated restaurant and you reply with "but if everybody follows your recommendation, it will be too crowded and prices will rise and it won't be underrated anymore!". Which is true, but it's not the case that everybody will suddenly go there.

If more people did technical degrees (and CS is not the only one) instead of liberal arts degrees, gradually the salaries for technical jobs would go down a little and salaries for liberal arts jobs would go up a little.

That said, I agree that more and more people getting university degrees -- whether due artificial legal requirements or societal expectations -- is not necessarily a good thing. In Japan, going to a trade school for 2~3 years and then getting a job is a common alternative to going to college or junior college.

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