Well, in all honesty I think it's a copout to blame the way the system works. I'm not saying that's what you've done, only that people seem to think the continuing degradation of our educational system and test scores and all that is tied to the way the system works. That's part of it, but the REAL problem that I see is the students themselves.
I guess I should preface that by saying that it also has to do with the home environment, but the students need to seize control of their education themselves, which is something I told my students almost every day this year. When I was doing my student teaching a couple years ago I was placed in a classroom at the very beginning of the program with a teacher who was absolutely horrible in every sense of the word. But you know what? That shouldn't stop students from accomplishing a lot on their own. They're going to have to learn to do so on their own at some point, so why not now?
Like you said, there are students that go on to succeed from all sorts of different schools and backgrounds. And students hear all the whispering going on about the system being totally fucked. And all it does is give them a convenient excuse for their own failures. One of the students in a class of mine from last semester used to live right next door to me. His dad was a complete burnout collecting disability checks from a wrist injury and smoking weed and drinking Sierra Nevadas all day. I used to look at his kid and think to myself, "this kid is totally fucked." But when I had him in one of my classes I was shocked at not only how bright he was, but also by how motivated he was.
I just think that students nowadays don't realize the importance of education, not only in terms of the job market but just in terms of developing into well-adjusted, well-rounded people in general. I don't think any sort of systematic changes can really drive that point home; it's something that comes from their home life, their environment, but ultimately, from themselves. I suppose it does take good teachers to help foster that sort of attitude, and I'd like to think that I do a good job of it, but I saw students every day in my class who just did not get the message at all. I don't know how to get through to students who simply don't give a fuck about school.
I guess the world needs ditch-diggers, too.