So, I've adopted a different attitude - I don't get disappointed with students with "potential", I get angry. When they say, "I know, I know, you are disappointed because I have so much potential," I disagree - I tell them they don't have potential at all, they are too stupid to have potential - after all, a smart person would figure out how to pass high school.
I realized today that there is another (perhaps less antagonistic) way. I realized this as I was writing a letter of recommendation for a student that truly has potential. This student, if he remains on the same path, will soon make a substantial contribution to society. I was wondering what the difference is between this student and the large numbers of students who have had "potential" and failed. I realized that this student has future potential - he has the intellectual abilities, but also enough of the work ethic to make something happen in his future. When we talk about lazy students with "potential" we are mostly talking about the ability to complete the work being assigned but not doing it. This doesn't give the student potential, it just makes them lazy.
I looked up the etymology of "potential" - it comes from the Latin potent - which means, power. In order to have the power to accomplish something, one needs to have both the knowledge and the will. Lazy students don't have potential, they have Fs. So, all you teachers out there - enough with telling students about their "potential".
(I suppose there is another, more cynical analysis of why teachers do this in the first place - rather than really engaging students and figuring out how to get them motivated, saying a student has potential, but is lazy serves to shift the blame (and onus) for the failure of the teacher in the whole teacher-student relationship, but I think I'll leave this one alone . . .)