I see both sides of this debate. I don't believe kids need to learn the lesson of competition at the younger ages. That is what I believe high school ball is for. You compete for a limited spot beginning at the ninth grade level and for your respective high school team. I believe summertime is the time for development. The only way to develop is to play.
People may think they know who the best players are at 14 but often times they are wrong - including the experts. Many confuse physical maturity with talent. The tortoise can beat the hare if given time to develop. The ugly duckling can become the swan.
In this country, we should be trying to develop as many kids as we can and providing as many playing opportunities for as many as we can without regard to who wins the tournament trophy. Of course we train our kids to win but it is more important for them to develop. They can learn about competition when they get to high school and college.