They did have some success with getting the unions to make these kinds of concessions in D.C. http://online.wsj.com/article/SB1000142405270230336240457558..., allowing the schools to cut under-performing teachers instead of having to make cuts solely based on seniority.

Unfortunately, it looks like those efforts are stalled at the moment due to the mayor losing his re-election bid.

I agree with you though, the unions are a huge part of the problem with the education system in the U.S.