Because it's a game, not real life. If you can't distinguish between the two...
My point is the game is supposed to be fun and not at all realistic. Consequences are not fun, otherwise they wouldn't be consequences. If you want to take your concept further, all characters in WoW should be hardcore, as in deleted as soon as you die. How likely would you be to raid if your character was deleted after one wipe? Those particular consequences primarily cause people to have to spend more time in old level-up content, which means that fewer people can raid, meaning that they can drag out the length of raid tiers far more. Why would they need to create a new tier when most of the people who have cleared it have died and restarted already? You'd have a hard time gearing up for the next tier when you could be set back to zero on any attempt. Plus it would mean that they'd have to tune down the chances of you dying, ie the chances of you failing, making the game easier.
TL;DR: Consequences aren't fun, therefore they don't belong in a thing designed to be fun.