I think too many people these days blur the lines between passable and outstanding work. For whatever reason, people feel entitled to be credited with outstanding work when the work they're doing is really just satisfactory. Maybe I'm contributing to that by adding the "just" to satisfactory. Most people are "average." There is nothing wrong with that, but for whatever reason, it's seen as substandard when it really is the standard.
Rachel's friend's work was good, but not outstanding, because she couldn't communicate well in the language in which the course was taught. She wasn't failing, she just didn't receive superior marks. There is nothing wrong with that! If anything, we need to see this not as a barrier to a degree, but as an opportunity to learn and improve in the language of choice. People have a better chance of excelling professionally and socially if they know how to communicate effectively with those around them. Schools should enforce that.
...By the way, if there are any current students who happen by this posting, I highly recommend having friends and family proofread your work before submitting it, and try NOT to have the same proofreader every time. Sometimes it's easier for others to catch small errors, and sometimes others can give you a perspective you may not have thought of...
Within the educational system, the value of the degrees we confer is lessened when we pass people just for enrolling in our classes. I admit, this is a blurry line, and some happy medium between one extreme of teaching to overly rigid standards to the detriment of all else and the other of not having a consistent set of criteria to judge progress has yet to be found. But it seems as though the value of our degrees is already compromised. I taught a computer skills course a few years back, and when we covered formulas in Excel, I had to give a basic Algebra lesson for the younger students. The older students may have been a bit rusty, but it came back to them much more quickly when I said "Please Excuse My Dear Aunt Sally."
In terms of the individual, when we award students grades they haven't earned, we do them no favors. In a sense, we are setting them up for failure at the next step or perhaps beyond. I would rather have someone have the opportunity to work on their weak points than send them on ill-equipped for what comes next by ignoring them.
All this said, I don't know what the solution is. I know a lot of primary and secondary level teachers who are dedicated professionals saddled with overly crowded classrooms and not enough resources to do even small things like make photocopies for their students. The masses want to place all the blame for the system's shortcomings onto them. Yes, there are a few bad eggs, but those exist in pretty much all professions. A lot of the problems lie in the dense and inefficient administrative/bureaucratic structures created by a bunch of separate laws implemented by tacking their requirements on wherever they may sort of fit, rather than something created as an integrated system.