The Atlanta teachers cheating scandal is one of the most embarrassing episodes of US public schools in modern history.

Some of the findings of an investigation report released by the Georgia Governor's office are shocking.

Almost 80 percent of the schools examined cheated on the Criterion-Referenced Competency Tests (CRCT).  Teachers would erase wrong answers on students' standardized test copies and put in the right ones.  Poor-performing students would be seated next to high-performing ones to copy their answers.

One teacher was made to crawl under a desk during a faculty meeting because her students' test scores were too low. One principal threatened teachers with termination and jeered that Wal-Mart is hiring.

Teachers told investigators that some school districts were run like the mob and teachers who didn't cheat or reported cheating feared retaliation.

So how did Atlanta's public schools turn into mafia lite?

The reason is high stakes, low supervision, and systemic corruption. 

The stakes are people's jobs.  If a school's students didn't perform well on standardized tests, funding was cut and heads rolled.  If teachers cheated, however, they escaped punishment, received praised, and didn't get caught for years.

From a game theory perspective, there was little reason for teachers not to cheat, especially if competing school districts also cheated. 

The Atlanta teacher cheating scandal is a classic case of setting up an incentive structure without any supervision to back it up, thereby rewarding players who game the system and punishing those who don't.

The deeper concern, however, lie in the fundamental poor quality of US public schools and neighborhoods in poor areas.

The reality is that the teaching profession in the US is underpaid and fails to attract the best and the brightest.  Of course, there are some teaches who do it for the love of teaching and do an outstanding job.  Many of them, however, aren't competent, especially those in poor school districts.

If teaching paid over $100,000 per year, for example, the quality of primary education will undoubtedly be better.

Moreover, how well kids perform in school heavily depends on their family and environment.  If a whole neighborhood and the families in it are plagued by poverty, violence, and drug abuse, chances are the kids won't perform well on standardized tests no matter how good the teachers are.

In many ways, though, I applaud an incentive structure based on standardized testing because it exposes the weakness of the US primary education system.  If safeguards against cheating are put in place, it'll be revealed even more glaringly.

Then, America will be more willing to begin to tackle the problem.