I think it's a little too easy to say that the problem is "we're being too easy on children". And yes, I think that there's a sort of Mrs. Lovejoy "Won't someone think of THE CHILDREN" every-child-is-a-perfect-snowflake political correctness that is a problem. However, I also think it is important to be accommodating to the different needs of different children.
There's a larger problem, which is that we don't know what we're doing, and we don't even know what we're trying to do with education. Are we providing vocational training to get a job? Are we advocating a general liberal-arts-type education? Are liberal arts stupid and useless? I can't seem to find a consensus.
So instead, we speak broadly about accountability without specifying what people are accountable for producing. We make our kids take a crazy number of silly standardized tests, and put a lot of pressure on them (and on teachers) to perform well. It's not clear that the standardized tests are testing anything that we care about, especially since it's not clear what we care about. We're telling kids, though, that it's vital that they do extremely well on such tests, or else they're stupid useless people who are unfit to do anything but become a janitor, and "being a janitor" is described as a punishment.
It's not at all clear to me what we think we're doing, but what we're doing is awfully stupid.