Jesus answered him, "Are you the teacher of Israel, and don't understand these things?
The Pharisees, including Nicodemus, had utterly rejected God's baptism administered by John, even though Jesus himself submitted to it; and that was the key to their ultimate rejection of Christ.  The ignorance of the Pharisaical party regarding the sacred ordinance of baptism was the immediate beginning of the end of the whole Jewish nation as the covenant people.  That stubborn blind ignorance, as it appeared so stark and adamant in Nicodemus, called forth the exclamation of Jesus in this verse.  No wonder Israel was in trouble spiritually when even her noblest teachers rejected the idea of being born of water and of the Spirit.  In such rejection, it was clear that the major part of Israel would continue to trust in Abrahamic descent, despite the warnings of both Jesus and John the Baptist  (Matthew 3:8-10;  John 8:39).