You make a few good points in your Q.
I've had a full licence for the past 15 years and it seems to me that peoples driving is far worse than it use to be.
I've been knocked off my bike twice because people just don't think or look, they're just in their own little world and nothing or nobody else matters.
I saw a van the other day overtake 2 cars on a bend with 2 solid white lines,after this ludicrous move he ended up 500 yards down the road behind a line of cars again !!
I think its not just the actions that needs sorting or lack of,its peoples attitude while behind the wheel,how many people have pulled out on you this week(with a sod you attitude) when if they waited 3 or 4 seconds you would have passed and the way was clear them,it happens to me quite often.
I don't think everyone resitting your test is the answer that's just going to line the governments pocket to spend on something like Iraq etc,I know I wouldn't be happy with it,there isn't an easy answer to the problem,only maybe more policing of the roads in unmarked cars and a campaign letting people know they're out there specifically to improve driving standards and safety,and anyone caught committing a serious or dangerous manoeuvre will have to resit the test and fined to finance more police cars to do the same.
Sorry for dragging on,rant over !!