The North Carolina State Fair opened this weekend, and the family enjoyed a fantastic day checking out prizewinning vegetables and livestock, an 1,187 pound pumpkin (unbelievable!), and meeting some new Ron Paul supporters. But the most educational conversations came when the kids and I were sitting down at lunch discussing the corn dogs.

Three corn dogs, nine dollars. That's three dollars per corn dog. Each "game" on the midway? Two dollars. Each ride? Generally three dollars unless you had discount ride tickets. The kids brought their own money, just to feel grown up, but as they counted their change at the table, it gradually dawned on them that they couldn't actually afford to buy anything.

My oldest realized it first: "Dad, that's crazy."

Then I explained that when I was her age, the games at my school carnival were fifty cents. She replied, "But that's just two quarters. These games are eight quarters! And the prizes aren't even that good! That doesn't make any sense!"

So then we had to talk about inflation.

"Honey, imagine that you had the ONLY diamond in the whole world. Do you think it would be valuable? Do you think other people would want it?"

"Yes!"

"OK, now imagine that instead of there being only one diamond in the world, that diamonds were just like sand on the beach -- and that you could pick up endless handfuls of diamonds whenever you wanted. Do you think diamonds would still be valuable?

"Well... no."

"Well, money is kind of like diamonds on the beach. The more money there is, the less valuable it is. When I was your age, there was less money. So it only cost two quarters to play a game at the carnival."

We chose not to get into the question of where all that money comes from. Understanding the time decay inherent in paper money is enough of a shock for one day.

I highly recommend the fair, although I consider the midway a pretty poor value for our declining dollars. Perhaps they're targeting Europeans and Canadians instead of the state's taxpaying citizens.