Cheating in school - ultimately a lack of self-respect?

I recently observed students cheating in classes. One was cheating by copying someone's homework. Others were cheating by copying others' observations about a movie being shown in class. They didn't seem bothered by this or even cognizant that this wasn't okay...shown by the them not realizing that they should hide these actions. 


My husband, Steve, clarified that cheating is actually fraud: "It is trying to pass off someone else's work as one's own."  Why does cheating seem to be so prevalent in schools today. Is it moral relativism's influence? Is it our obsession with image vs. integrity, with what we look like versus who we are inside?


Anne Morse in a Breakpoint entry had this to say:
"We must teach our kids to cling to integrity, even if it means losing that precious scholarship. We must do so—I must do so—even if it means that my sons lose out on getting into their first-choice school, and I lose the right to put that “Harvard” sticker on my SUV. I must warn my sons not to cheat even if it means flunking out of school while cheaters prosper and graduate with “honors.”
When we see others getting away with cheating, when we see our own children pay a price when others cheat, we need to put our anger aside and remember that God cares even more about our children’s future than we do. He’s perfectly aware that unscrupulous people might attempt to interfere with our—and His—plans."
(http://www.colsoncenter.org/features-columns/articles/1293-competing-with-cheating)
Are we parents ready to do this? Are we caught up in worldy success versus godly success and virtue? What is more important to us - our children's characters before God or them "getting ahead" no matter what the cost to their souls?

My daughter, Hayley, a high school freshman, commented that the cheater hurts himself and most likely will get caught in the end. He may get a good grade on homework, but when he doesn't do well on the test, the teacher is bound to notice. In other words, the cheater's lack of morals leads to his lack of subject knowledge and later failure.

Friend Dave Smith says ethics is "who am I when no one is looking?"  This touches deeper into character and even deeper into respect for oneself.