Ironically the issue is that banks tend to be too forgiving for that to be the deterrent it used to be. I suppose medical bankruptcy also shares some of the "blame" from a number of no fault of their own bankruptcies.

Of course the other two issues are that such a "retributive" system of treating debtors with a scarlet letter isn't productive even if it appeals to a sense of "fairness" to those who pay. Second, the reason banks don't care about old bankruptcies isn't anything high minded but because they like money and can make it if they don't pass them up.