It signifies that professors care less about their teaching. Far from the opposite of caring, being critical is the very consequence of caring. Students today are still motivated to get good grades, but if they do not wish to work hard toward that end, they can always maneuver and bargain. Some say Harvard students are better these days and deserve higher grades. But if they are in some measures better, the proper response is to raise our standards and demand more of our students.
Cars are better-made now than they used to be.
Besides, the evidence clearly undermines that argument. The Harvard University Extension School, taught mostly by Harvard faculty members, has about the same grading distribution as Harvard College, although exact figures on grades are difficult to come by. In fact, science students regularly do better in nonscience courses than nonscience students do in science courses. Perhaps I should be asking how we should get out of it. But to answer that question, one needs to appreciate the strength of feeling behind grade inflation.