As a graphic design student and someone who started on photoshop, I'd just like to share my views.
Photoshop, for me, acted as a way of getting into design. A fun and not too expensive (with PS elements) way with lots of tutorials and help online. Before I knew much about graphic design I started playing around in Photoshop (I'm talking when I was about 11, so quite a while ago). It started off as just a bit of fun. I would edit photos of cars and just show them to family or friends. A few years later I was on some gaming forums making small designs for people. I'm talking avatars and signatures, all forum based graphics. I didn't claim to be a graphic designer, and I didn't charge for the work. A few years later again and I was doing a little bit of paid freelance work, and now I'm doing Graphic Arts at university.
I agree that photoshop is a tool, and I understand that there are some people out there that learn how to use it and claim to be a designer. Some may think that starting a design career learning the basics by hand or 'the old fashioned way' and then learning the tools/programs is the best way to do it. I think in the modern day we live in, photoshop acts as a great way for young people to get interested in design. Don't forget that while we may be judging the people who claim to be designers, and charge £10 for a logo, they may just be in their early stages of their career. They may be where I was a few years ago. If they have the drive and determination then they will hopefully go on to do bigger and better things. If there's a market for lower quality, cheaper designs then let them do it. If anything I think it would be more productive for the design industry to encourage all young people to try their hand at it and do their best, rather than criticise. Cheapening the industry? Maybe. But if someone had shot me down a few years ago and told me I wasn't a real designer, I may have stopped pursuing a career in graphic design.