This is a great question, Rex. In North Carolina, where I teach, I don't think the deficits are so great that two years of community college cannot address them. There's a policy problem, however. The system doesn't reward transfers even though more students are transferring every day. Retention and graduation are rewarded with state funds. If a student starts at a community college and transfers to us, it's counted against them and not counted "for" us in the same way, as I understand it. If we recruit new students from high school and they drop out for financial reasons, say, or transfer to another school, even another school in the system, it's counted against us. We may have prepared that student for success at Chapel Hill, for example, but we've "failed" to retain them.
I suppose the issue regarding admissions is whether the community college system is a better and more equitable socioeconomic selector of the students it is preparing. I'm afraid I have no sense of that. I do know that it is much more affordable, so it probably does .