Overall, Holden reflects a rejection of the industrial view of education. His learning style fails in this system, but he is still subject to its judgments. This fact adds to Holden's larger worldview that the world is phony. He rejects the education system the same way he rejects the consumer-driven lifestyle of adults later in the novel.
With his expulsion from Pencey Prep, Holden has failed out of every preparatory school he has attended. However, it's obvious from his conversation with Mr. Spencer in Chapter 2 that he is an intelligent boy and his teacher is suffering from guilt after failing Holden. But the question remains, why are schools failing Holden?
Holden is clearly a creative person, as evidenced by a) Stradlater's willingness to let Holden write a paper for him, and b) Holden's decision to write a descriptive paper about Allie's baseball mitt. This type of lateral thinking, as opposed to linear thinking, makes Holden an extremely empathetic character. He makes connections that aren't readily present to most. However, this type of lateral thinking is discouraged by teachers. He explains an experience he had in his Oral Expression class to his old English teacher, Mr. Antolini. This is how Holden explains the class:
"It's this course where each boy in class has to get up in class and make a speech. Spontaneous and all. And if the boy digresses at all, you're supposed to yell 'Digression!' at him as fast as you can. It just about drove me crazy. I got an F in it."
Holden goes on to explain that he thinks it's "nice" when someone moves away from a topic to explain something personal. He says that the topics taught in school aren't interesting. Instead, schools should "leave somebody alone if he's at least being interesting and he's getting all excited about something." Then he goes on to explain how this Oral Expression teacher wanted everyone "to unify and simplify all the time," but "you can't hardly ever simplify and unify something just because somebody wants you to."
To look at Holden as a failing student is only partially accurate. He's a failing student in an industrial system that is failing him.