Disagree. The quality of trainees coming in during those old CTI days was not any better on average than the off the street hires. They were, however, mostly male, white, and already upper-middle class. People who could not shell out $30k+ for an associates degree that would not help them get any other job were simply shut out of the hiring process all together. If you shelled out for a CTI degree and then didn't get hired, well you knew the risks, a job was never guaranteed.
The problem is the two-fold: 1) the FAA knows nothing about human resources, and 2) no one wants to be an instructor because the pay is crap, the hours are long, and you have to live in Oklahoma.
This will help ease the flow at the academy, but I'll bet training success rate tanks. Especially if the FAA does not provide the syllabus for every CTI school.