Education is a very tricky topic. Obviously, maintaining a high standard of education is absolutely paramount for any society that wants to grow and make progress. However, expending too many resources in the wrong place in an effort to keep up with high standards can waste time and money and leave you worse off than you were in the first place. Also, simply spending that time and money, even if it is within your budget, can be a problem if the measures that you're taking are not efficient--in other words, policies that are intended to facilitate the process of keeping effective teachers focused and productive can backfire if they end up being too cumbersome.
On the other hand, too much of a 'hands-free' approach can create opportunities for teachers and professors to become lazy and ineffectual without the threat of review or evaluation. That brings us to the primary topic of this article--tenure for teachers and professors. Tenure is the practice of offering considerable job security to teachers and professors who have reached a certain status at their institutions. It is usually reserved for the more senior employees who have a proven track record of adequate research and performance. To make a long story short, being awarded tenure makes it nearly impossible to fire the tenured professor.
There are many reasons why awarding tenure makes sense. On the one hand, it allows schools to save money by paying a little less in salary to tenured teachers than they would otherwise have to--most people are happy trading some portion of a salary for assurance that they will not lose their jobs. Also--and this is the most common stated reason for tenure--it creates a situation where a teacher who had proven himself to be competent can continue his research and critiques without fear of professional reprisal.
Basically, professors need not worry about losing their jobs because someone in charge disagrees with their work, or thinks that it is unimportant. This gives the professor intellectual freedom to pursue whatever research he sees fit. Without tenure, professors might feel pressure to pursue academic goals that were less in line with the things that the professor found intellectually important, and more in lines with the financial goals of the university he works for.
The potential downside of tenure is that is ties the hands of university officials in the case of a professor whose performance is dropping. It is entirely possible to create a situation where a teacher who has been a valuable part of the university for many years can go through some kind of internal crisis or simply become bored or disinterested and, as a result, stop doing his job well. Then the university has to deal with a professor who will not do what he needs to do to teach his students, but who cannot be fired because he is tenured. That creates a drain on taxpayers and on the university, and it harms the students who must take classes from someone who is not 'all there.'
Like many issues related to education, tenure is a touchy subject. There are passionate people with valid points on both sides of the argument--on the one hand, it is important to give effective professors job security and academic freedom. On the other hand, it is also vital to have a system where under-achieving faculty can just slip by under the radar. The best answer is probably some combination of the two--a rock-solid tenure system for quality faculty with some kind of emergency safety net that universities can invoke in the extreme case of a less-than-ideal employee.