Education as we've known it is finished. Even in my day people used walkie talkies stored in the bathroom to call frat brothers with answers.

This isn't anything new - cheating has always been a part of the US way of thought AFAICS. "Everything is legal if you don't get caught". In fact, there has always been a 'sly admiration' in our culture for people that 'get away with it'. A lot of the so-called moral outrage you see is more along the lines of "I couldn't get away with it, why should YOU" rather than "That is the wrong thing for anybody to do".
The motivation is what puzzles me - if you are a cheat, how can you derive any self-esteem from getting into a good school?

Motivation for school is seldom self-esteem, or even interest in learning. Instead, it's a stepping-stone to monetary success. Cheating is just 'get rich quick' thinking.
Again and again we see that one of our root problems is simple lack of shame. This MUST be a direct consequence of new-age elementary schooling. Failure needs to be an option.

I dunno about the causal relationship, here. I think new-age schooling (where there is no fault, blame or true failure) and the cheater's mentality both have root causes in the loss of the concept of personal responsibility here in the 'States. And I think the root of THAT is our overly litigious legal system.

Of course, that we have allowed our legal system to become the joke it is is all of our collective faults. And no, I don't know how to fix the problem now that it's woven itself into our society.