There's nothing wrong with healthy competition, and also the recognition that someone may be truly outstanding.  This pretence that somehow we're all the same is ridiculous - there are in fact very few really talented artists, writers, scientists, etc.  I see nothing wrong with honouring them, or honouring young people who show signs of brilliance.  It's  an example for the rest of us, and it gives them motivation as well. 

And lets face it, competition is a pretty deep and primal motivator, especially for boys.  One reason I hear over and over again about why boys are really falling behind girls in school is this very reason:  boys ARE different, they have some innate response to hierarchy and competition that girls don't.  Removing this from schools may remove motivation from many.  Social engineering this instinct out of them doesn't seem to be working.