Most garages were 2-car, and you don't want a car outside of a garage in snow. I was actually offered my grandmother's car for free when she died, but my parents refused it because they didn't want to deal with 3 cars in a 2-car driveway and garage.
No one else had any say in what car they would drive; 99% of the time it was Mom's minivan or Prius, with constant tension over when the keys would be brought back home. 95% of my graduating class went to college, and all but a few of them lived in dorms (at least for the first year) where car ownership was neither necessary nor permitted.
None of us will be thinking about buying cars until we graduate. And even then, those who will have money to buy cars they want, instead of the cheapest thing that starts, will be the San Francisco software engineers and the Manhattan investment bankers, i.e. the people who don't need them. I know a few people who got cars out of necessity for internships in remote places, and on all accounts it was a ~10-year-old, boring, practical castoff of a middle-aged relative who wanted an upgrade, to be sold when no longer necessary.
Personally, I'd love a Jetta but I can't imagine what I'd use it for, and for the same amount of money I can get a fully-loaded rMBP, an iPhone, and less student debt.
Why not? It works fine, and there are few places in the US cold enough to even require a block heater, let alone actually endangering the engine. Just have to brush it off sometimes, but it's hardly a dealbreaker. I lived almost 20 years in Alaska and never had a garage that we used for cars.
I lived in a very rural area so for me car ownership really did represent freedom. But if that weren't the case then I think that calculus would have been pretty attractive to me. Having the freedom to not spend so @$@#% much time doing menial crap like flipping burgers? Heck yeah.