I have to disagree that the main purpose of grades is to measure students against one another as is suggested in the book, "The Art of Possibility" by Rosamund Stone Zander and Benjamin Zander. Although there can be a certain modicum of rivalry between students based on their grades, teachers do not give grades based on comparison to other students. If this were the case, we would not need rubrics and there would be only one "A" given to a class. Grades would serve as a student hierarchy. The best student would get an "A" and the rest would line up behind.
I do think that grades, at least at the elementary level, are fairly useless. Let face it, no college looks back as far as first grade or even fourth grade to see the grades they earned in school. It would serve students a lot more if we only gave out comments about what they did well and what they needed to improve. This would give the student and parent a lot more information and could ultimately prove to make a difference in that child's life. A letter gives no information except "bad" or "good".
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Grades... this is an ongoing conversation. Grades in elementary are pretty useless, when we can track something more meaningful like specific proficiencies in reading or math skills. I remember having a conversation with a middle school principal and he agreed that it was more meaningful to record actual student performance levels, but said that high schools and colleges would never give up their grading systems. We'll see.
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