Counterfeiting money is evil not because it hurts the counterfeiter, but because it takes away wealth from everybody else. Whatever the counterfeiter buys that is in limited supply, the rest of the people have to do without.

To the extent that debt resembles counterfeiting, it is evil. Here's an example: suppose you want to buy a prime waterfront property which is offered for auction. You've worked hard, saved your money in the bank, and you finally have enough deposited to make a substantial offer. At the auction, you meet Joe. Joe also wants the property. Joe hasn't saved as much money as you have, but he has a line of credit from the bank, a line of credit made possible because the bank is using your on-deposit money as a reserve against which it can loan out new money. Whether or not you win the auction, the price of the real estate is higher than it would otherwise be because of Joe's ability to bid against you. This seems wrong. Why should the fact that you saved money enable a non-saver to drive up your prices?

Note that without fractional reserve banking, Joe's line of credit would be backed by money deposited for a term. So the saver's prices should not be affected by the borrower, because the while the borrower is using the money, the saver has agreed not to use it. Under 100% reserve banking, a depositor never has to bid against his own deposits.