I first heard on NPR about the positive results that Missouri has with rehabilitating juvenile offenders. Last week, the NYT had an an article about how other states, like Florida, are also finding the benefit of similar programs which keep young criminals out of jail, where they consistently grow up to be (expensive, as well as dangerous) adult felons.

In the category of "things that work but we don't talk about them, even when they could make us feel good and save taxpayers money," you can't find a better example than this story:

http://www.nytimes.com/2009/03/27/us/27juvenile.html