I could write a book on education, including what to do to make it work regardless of the country or social system. Wouldn't change shit.
Jazzc as usual hit the nail on this subject in a very compact form. Very few here noticed that or understood it. Education, just like a lot of other areas of life, doesn't work precisely because there is an intrusion into the system. The system does not function in a natural way, based on "economic/resource" laws. The system is being "managed". Same goes for health, social security, infrastructure, everything really. Only systems that work properly are those who are not managed but self-adapt naturally (e.g. Internet is a good example, even though it is still being managed, just a lot less). Jazzc translated this as a problem of performance based earnings - tie up a teacher's earnings to the results.
Education, like everything else really, is a service. Like web hosting. Problem is, if web hosting would function like the educational system you'd have this:
You order a hosting plan for $40/mo. In fact it shouldn't really cost more than $5/mo but somehow it does. You pay it though. The web hosting site tells you the features include 99.9% uptime, 5000 GB of traffic, 100GB storage, free .com domain for life, support for PHP, Python and Ruby, MySQL and PgSQL. In order to pay for it the $40/mo you have to go and manually send money over Western Union, you can't order online. Then, after you bought the hosting you get your site up but you realize you actually have no PHP. You kinda have it but is so badly configured that you can't get WordPress to run on it. And there's no MySQL or PgSQL and when you inquire with support about this issue you are replied with "you can just use Excel to store your data, there's no need for MySQL". Eventually you get a static .html site up but during upload you get an error at 5MB storage saying you exceeded your allocated space. You ask support about it and they reply "stop bugging us, how do you dare! We offer 100GB storage but you must send us an 100GB HDD if you want that much.". Then after a month, you realize the site is down for quite a while because it exceeded 10MB transfer. So you complain to them and they delete your account. You then complain to the International Web Hosting association and they reply "it's your fault for being lazy and not putting more effort into building a dedicated server yourself and sending it to the hosting company already setup with your site on it and optimized and with at least 500GB storage free for whatever they might need to put in that space".
That's how the educational system is. If it would be hosting or anything else business related you'd feel cheated and robbed. But somehow when it's about education, health, etc. people just take it for granted.
The reason stuff doesn't work is there are layers and layers of things that work towards stuff not working. I'll explain a few.
Do you think it's complicated to have a working system, whatever that is - education, health, etc? It isn't. Problem is there's no incentive for that. It would simply be social and would stop being profitable for a few people. At the core, governments are legalized mafia-like organizations. That's not because of the government itself but because of the people in it. There are centers of power, influence and control. These are from weak&wide ones (the clerks you have to bribe) to powerful&narrow ones (people controlling the world more or less). The way to have a working system is to build it to satisfy the requirements. Thing is, current systems already do that. Problem is, like somebody already noted, the requirements are not of the masses but of those few at the top. So the system works perfectly for them but not so well for us. That's the core problem.
Specifically related to education, in order for it as a system to work, then it must be setup in such a way that it works regardless of the teacher (good or awful) and regardless of the student (smart or stupid). A smart student is likely to learn even if he has a bad teacher and a good teacher is likely to teach even a stupid student. Problem is, most students are not amazingly smart and teachers are mostly bad. But this isn't just like that. They get to that point through an involution. The student is a former child and as all children he's creative and curious. But he is educated and everything positive in him is slowly killed. New "software" is etched into his mind and after years the way his mind functions is extremely different than it used to... in a very bad way. From all those children, some eventually end up becoming teachers. So it's a destructive cycle of the man and it's mind and soul. That's another onion layer.
The above layers, together with a bunch of other layers, are why stuff doesn't work. In a nutshell it can be translated as "lack of interest" - either on purpose and with a goal (those in high positions have no interest in making your life nice, but the opposite), or because of ignorance (the teacher has no incentive to be good). Hence, those who have the power to change something in a top-to-bottom approach, will not do it because it is in their advantage to do the opposite. On top of that, those who can change something from bottom-to-top are only human and unless they are of a very rare breed - extremely resistant to social programming and other negative elements - they will collapse into ignorance and the "rat race / mouse wheel" effect.
If, those in position of power over laws and decisions would actually want to, it would be very simple to fix the educational system regardless of how bad or assholes the teachers are. You simply make it a 100% natural service provider type of system where you take the power from the hands of the teachers. And on top of that you completely eliminate diplomas and titles and grades which now are an instrument of control and authority in the hands of teachers. So essentially what would be left would be the service and the price for it. You pay $X to learn Y skill. No grades, no diploma no nothing. And nobody would ask you for them to hire you, employers would just test you themselves, which is what happens now anyway with any company that demands quality and not just a piece of paper. So, as with any service, if you pay and don't feel you receive what you payed for, you request refund or simply drop out after a month. There would be nothing to force you (need of diploma) to stay there in a system that doesn't work for you. So, this would push the balance of power from teachers (service providers) to students (service consumers) as it is normal and healthy to be. That in turn would be an incentive because teachers would have to compete and raise up to certain requirements/standards that are real and affect them and not just on a piece of paper (laws) they don't care about and can't be enforced upon them. What would happen is those teachers who suck but have the ability to be good, will put the effort and become good. Those who are just bad and can't adapt would have to find a different job.
Honestly, I think the revolution in education has already started even though is slow and not seen for what it is. It's the Internet and the Web. But this only covers the knowledge so far and rather poorly and in an unstructured way. It does not cover the incentive for the people to gain back their curiosity to learn something or provide them with enough incentive to learn something instead of spending half a day on Facebook or YouTube watching funny cat vids. In other words, we have the technology, we just haven't got to use it to the full potential.
Personally, I will never send my kids to school. I will make it an option. You wanna go to school? Then go ahead and have fun. But the learning will happen at home. As a parent I wont send them to school expecting to learn something but just because and if they want it as a social thing, to meet kids and have fun. That also means I understand it is my responsibility as a parent to educate them. I will not force them to go to school or demand from them high grades or them to listen to the teacher and that alone should be a huge advantage for them because at least i know i'm not killing their creativity and not filling them with bitterness and stress. Also, I really think the key is not in managing to convince/force a kid to become what you think is best for him but instead to recognize what he truly loves and is naturally compatible with and support him in doing that. I don't care how dumb a passion might seem, if you totally love it you can make good money from it. You just need some common sense and basic money management skills.