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It's not all we have...
But it's the only way a professor can run multiple classes of 100 students each.
But colleges are all about profit, so classes sizes are going to be huge.
The goal isn't educating people, it's making money.
So when they say "there's no other option" they're not mentioning the "and keep making as much money" at the end, it's just implied.
I'm not in the us collages are generally vocational here with both colleges being less (while not totaly) concerned by the money side.
For example where I live university courses are free for those in country outside they pay fees
Dunno how it's done elsewhere but our course are usually measured in 3 parts 1 exam 2 practical 3 essey/investigation. Everyone hates exams
It's also the only way that is portable. A professor could evaluate each student, but has no way to transmit that kind of evaluation in a way that schools or employers across the country would trust. They didn't know who the professor is, or what his standards are, or even if he is being bribed to pass somebody. (Which would happen much more if the professors opinion had the weight that the standardized test does. )