It's all about free markets. If people want to put their money into a bank that offers fractional reserve banking then fine, that's their choice.
The problem we have now is the FED can print money out of thin air and give the money to banks of choice who can work as they please knowing they're too big to fail as they can do no wrong in the eyes of the government. If there was true accountability, banks could fail, and no shadowy hand of the FED picking who makes fortunes in the financial sector, you'd notice a world of change. This would allow a free market banking to actually exist and people would have to decide what sort of bank they do business with.