Medals for mediocrity?

In a race, there is only one true winner.
When the Greeks started the tradition of their Olympic competitions only one person was recognized as the winner. There was no medal for 2nd and 3rd and the competitors fought to their death to win, literally in some cases. In the modern Olympic Games, I like that there is gold, silver, bronze. It makes it more fun and encourages camaraderie with everybody of all the countries around the world.
In this modern day though where obesity has been said to be the fastest rising epidemic medals and trophies should still be reserved for the winner only. This should make the rest of the participants more admiring of the winner and their deserved reward. The loss should also encourage them to work harder, train harder for next time.
If everyone is given a medal or rewarded then it diminishes the effort and accomplishment of the winner. No we are not all equal in this case and rightly so it should be that way.
Children are not made stronger people by saying "you're all winners." In fact, ironically, I think in the long run this attitude makes them less likely to work hard, weak people without drive and ambition as well as sore losers.