That's argueably already happening.  There is some research out there suggesting that the Flynn effect is decreasing or no longer exists in western countries... and that like you said... it more or less did mask a negative correlation between intellegence and fertility.

Which just makes sense afterall, since a lot of people are having kids while others are still in college.    You could be in your 30's before you finish your degree at the top of the spectrum.

EDIT: Fyi these studies are mostly conducted in the Scandanavian countries and Austrlia, so such research isn't being effected by the US Drop in school scores or failing schools or anything.

Additionally some researchers blame immigration and the kids of immigrants instead of the intellegence/fertility negative correlation.

As of 2007 in the United States, 20% of high-school graduates are classified as functionally illiterate and 50 Million Americans read at a grade 4 or grade 5 level. Certainly, the average person today is spending far more time in the education system but it can be argued that many of them are not more educated than people were a few generations ago.

My grand-father who was an orphan, left school in grade 4, educated himself through his life by constantly reading, and was able to do complicated matematics and engineering work to build some amazing devices in his shop; and with 8 more years of education the typical (median) high-school graduate is probably less educated than my grandfather was at a similar point in his life, and probably has a lower capacity for learning.

Key words being ''average'' and ''200 years ago''. And why use USA schools ?  Use Finnish or Japanese 

You're picturing this very black and white. I'll just add that I think the direction forward you mention and I see around me is not the direction that will make us all get along. Social skills require an amount of intelligence that is not very common these days. But those same skills will make people work together which eventually will result in more progress.