Reading your post certainly brought back some memories of raising kids. My son sounds much like yours, and you sound like me, I was ready to give up and just let him suffer the consequences by the end of his freshman year. I had worked with the school who provided extra help through a support team who would go to the classroom and also had a class kids went to who needed extra help with their school work. Even with this he still did not do well with some subjects. Our dilema was him respecting the teacher, if he didn't he would not perform well in that class.
I don't have any magic answers, all I can say is use the resources your school may have to support you and your son. Use the support of other family members, church member or friends when you feel hopeless.
The rest of my story is my son is 27 and a couple of years ago he ask if I knew why he stayed in school and graduated. I said no and he replied "because I knew how important it was to you mom." Yeah I cried for all the times I had wanted to give up on him because it wasn't that he didn't want to do graduate but he also shared made the comment about how hard it had been because of how ugly kids these days can be, and I could still see the hurt in his eyes. I don't know if we as parents really know how our kids days go, the peer pressure, the grade pressure, it is all so much more intense today. Also found out in just the last couple of years that my sin battles depression. He is now taking medication and for the most part does well dealing with it. I don't advocate giving medicine or looking for excuses but when I looked back at pictures I'd taken of my son and school pictures I wonder how I could have been so blind. The gaunt look and the hollowed dark circled eyes. This may be something you want to think about if your son may have problems with depression, I know you said you've had him in counseling but so had I at one time and no one picked up on the depression. Remember depression is a sickness, it's not about someone who isn't happy although that is a symptom.
As far as my sons life today - he is a productive, responsible young man working for a good company where his job duties requires a certain amount of self motivation and decision making. Of course it is dealing with technology which he thrives on. His self esteem for the most part is very confident but at time his self image is still low but my prayer is that one day he will come into the full realization of how precious and valuable he is.
My words of encouragement to you is remember no one ever said raising kids was going to be easy, you may be the only one who your son feels like believes in him. The punishment thing never worked with my son either because he felt like life was a punishment I believe and the flip side of that coin was he knew beyond a shadow of a doubt that I loved him and