Martin Sandbu has a quick ‘Free lunch‘ on the symposium on Debt and Morality held in Germany, recently. The reason why somehow borrowing and borrowers defaulting have been equated to a moral crime is that lenders sacrifice their present consumption to enable the borrower have his/hers brought forward. Some one accepted delayed gratification for someone else’s instant gratification. That could be deemed a ‘sacrifice’ and hence the negative connotations attached to excessive borrowing, consumption and default choices.
Pl. note that I am not trying to defend present-day lenders and their greed for return that make them overlook returns and then rely on a sovereign backstop for their private lending decisions that go sour. It is a business risk. They took it and they must take the consequences that come with it.
I was trying to hypothesise on the possible historical evolution of the moral overtones attached to borrowing and lending.