Sorry, I'm going to get too blabby here, after making a concerted effort to keep it brief in the previous post--and, again, this is just me, and only you know your child, the teacher, the circumstances, and so on...
But what really bothers me about this, in many ways, is the fact that if another child had spoken to a child this way, a school in all probability would have a mechanism for dealing with it; certainly this type of verbal abuse would be considered bullying in our school system here if one child said it to another. How is it different when the teacher is doing it, except that the child is even more powerless to stop the bullying behaviour from happening to him?
What worries me about potentially letting it slide is that the lesson might be communicated to the child that he is in fact powerless in the face of such types of abuse, which is not a life lesson I think kids should be learning. (I don't mean to imply that you have been letting it slide; indeed, your repeated attempts to reason with the teacher are admirable.)
I taught for many years myself, and cannot imagine ever, ever saying such things to a student. She shouldn't be in a classroom.