The goal is for them to strive for excellence during the year; to put in the effort so that they WILL be recognized for it. Its true: graduations are painful to watch at best; but they are a necessary evil if we want to encourage our students to work hard. (Think Schar v’Onesh)
As far as the jealousy aspect…guess what? The kids are going to have to learn how to deal with feelings of jealousy all through adulthood. Now is a great time for them to learn a simple lesson. Work hard, do your best, dont goof off the whole year, have a good attitude, and you will be rewarded for it. I think it is a very liberal (dare i say almost marxist/communist) view to think that everyone should be equally rewarded for different efforts, achievements, and successes.
And even if they struggled all year and put in more effort than the valedictorian, they need to understand that that’s the way of the world. Life is not always fair – its an important lesson for them to learn.