That divider isn't attached to the tank and the core, so water just flows over and bypasses it.
Here's a great way to prove it to yourself. Figure out the total volume of the heater core — its around 300-400mL. Fill it half way with water you colored with some food coloring. Attach a hose (or just run it under the tap) to just one side and run it until the water is clear. Run it for 10 minutes, an hour, however long you want. Flip it over — you'll get 200mL of dyed water out of it. The water going in one side just immediately comes back out the other side. No circulation. That's why everyone complains that despite these being brass, they put out minimal heat.