A number of factors have contributed to the inflation of grades in higher education, including: the belief that grades traumatize and dehumanize students; the conviction that academic standards are unfair in light of the equality of each individual; teachers' hesitation to fail high-risk or open enrollment students; the influence of popular grading practices on student evaluations of teacher performance; pressure to eliminate certain course requirements; and innovations such as pass fail grading. Administrators have gone along with student demands to minimize evaluation procedures, according to three basic rationales: that grades are inherently inaccurate; that they traumatize students, foster competition, and harm students' ability to learn; and that the categorizing nature of grades defeats one of the essential purposes of education--to help students develop their individuality. Each of these arguments can be refuted. The practice of assigning inflated grades should not be continued, because it leads to a decrease in basic skills, gives students a distorted view of their abilities, and fosters mediocrity. (GDC)