Steven Taylor has some pretty comprehensive advice on whether or not to pursue the Ph.D. There’s some other advice I’d add:

• Pick up a copy of Getting What You Came For, by Robert L. Peters.
• Research grad schools before you apply. Make sure they offer what you want beforehand; there’s no point in coming to Ole Miss or FSU if you want to study political theory, for example.
• If you’re still an undergrad, try to bum your way into a conference or two. It will give you a flavor of what you’re going to spend the rest of your life doing; better to find out if you like it at 22, when you can still get a J.D. or M.D. instead, rather than once you’ve accumulated sunk costs.
• Don’t just go somewhere just because it’s close to home, or because they’re making you the best assistantship offer. It can be a consideration, but that shouldn’t be the determining one.
• The rankings (particularly in US News) are often outdated, as changes in reputation take time to filter through disciplines. Especially when you consider that #20-25 will be completely different when you’re done, which is when the reputation will really matter.
• Look for schools with faculty—particularly tenured faculty—who publish regularly. That’s a leading indicator of reputation improvement.
• Unless you’re going to a top-tier program, you probably won’t get the “ideal Research I job” straight out of grad school. On the other hand, it may be easier to get a liberal-arts (teaching-focused) job out of a less prominent institution, as they’re less likely to think you’ll jump ship once you have two or three years under your belt.
• If you do want to be in the “Research I” rat-race, look for a postdoc at a top-tier institution to help close the gap between you and the applicants with top-tier Ph.Ds when it comes time to get the “real job.”

All that being said, you can’t beat the job of an academic. Where else can you get paid for doing pretty much whatever you want, whenever you want?