Often in college, grades are often given based on effort rather than skill. The theory seems to be that people who are naturally more skilled have an unfair advantage over those who have to suffer through it to get a basic understanding of the material.
People can get a high GPA, just for "putting in the effort"- and graduate without having any real talent. There is something to be said for people willing to do the work, but it shouldn't be in the form of an A.
Grade Point Averages are just a way for us to quantify something that's unquantifiable. Most employer's realize that- you won't find many who will hire someone solely because they graduated with a high GPA.
So, then, what's the harm in inflated grades? An A basically means "no room for improvement." If someone receives an A, he or she has no reason to believe they are not proficient in the given topic- meaning that sub par people will never know they're sub par.
College should be like hiring a cold hearted fitness trainer to yell and demean us. Instead, though, we get upset if they don't do the equivalent of handing us a donut while telling us how in shape we look.
As a student, it frustrates me to get a grade lower than I feel I earned. However, it upsets me even more when I get a 100- where's the motivation to improve, or the knowledge that I have to?