A quick disclaimer: I'm not anonymous on College Confidential because the information on this forum affects people's real lives. My username is also my Princeton netid because I believe that I should be held responsible for the suggestions that I make.
To the meat of the matter: grade deflation.
I was really nervous about grade deflation. Many of you have probably spent some time agonizing about it, and more of you have been curious about it. The official FAQ's about Princeton's grading policy can be found online, so I won't re-explain the technicalities.
Grade deflation does have an quantitative affect on your GPA. In some classes, it means that your professor will tell you that you've done fantastic work on an essay, but give you a B+. In other classes, the curve on your exam follows the general spirit of the grade deflation policy.
Ten years down the line, employers will care more about my abilities and my past experience rather than my GPA. But will grade deflation put me at a disadvantage when I apply to my first job or grad school?
In most cases, it shouldn't. When you send out your resume to many companies, there will undoubtedly be a few that will ignore your alma mater and your major and only look at your GPA. That's reality -- nothing works out perfectly. The advantages that you get from your Princeton education far exceed the losses that result from a couple negligent hiring committees.
The companies that you'll want to work for are the ones that can appreciate you and your education. Many companies will give you the chance to interview and prove your abilities just because they know what caliber of students graduate from Princeton.
When I congratulated my RCA for getting an interview with Microsoft, she told me not to be too excited because she didn't know anyone from Princeton who Microsoft refused to interview. During her interview, they tested her analytical and programming abilities rather than discussing her GPA, and she ultimately received an offer.
Many grad schools have similar attitudes towards applicants from Princeton.
I care less about statistics and more about how things affect me. Will I have to work harder at Princeton because of grade deflation? I will never know because I won't ever be able to repeat my undergraduate experience at another school. I just know I would've worked hard no matter where I ended up.
What matters to me is that I am pushing myself to exceed academically. I am happy with my grades as long as I worked for them and deserve them, not because of the letter grade I receive.
What matters to me is that the woman sitting next to me sees my Princeton beanie and starts a conversation with me. She reveals that she's a professor at UC Irvine and that she wishes she could have a Princeton student doing research with her. We talk about our experiences, and she ends up offering me a summer research position. We never once mentioned grades or GPA.
Grade deflation isn't that big of a deal. I am happier and more successful for simply accepting it and loving Princeton. I'm proud to be a Princeton student at any cost.