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The phrase disgusts me. Not only are you rewarding laziness, you are promoting it. For example:

You and another boy/girl are competing for a fitness medal in your gym class. You work hard day and night. Running. Jogging. Weight lifting. While the other guy/girl is busy doing 10 push-ups a day. When the competition is over, guess who wins? You! Congratulations! But what's this? Because everyone's a winner, your rival also gets an award just for trying! Is it honestly fair that worked your a** off for that medal, and someone else gets an award for being lazy?

How would that make you feel? If you were me, you would be pissed off. If you suck, you don't get an award. That's how it should be. You don't reward failure. How does that prepare kids for life? It makes them think they get everything handed to them.