Why, in such a debt-heavy era, is inflation still such a Bad Thing(TM)?
While many points can be made about the pros and cons of inflation, the following is one of the most fundamental.

Suppose A borrows \$100 from B and inflation is 5% per year. To keep things simple, assume the terms of the loan require repayment after one year. When the repayment falls due, A pays B \$100, but because of the inflation it is only worth (at the original price level) $100/1.05 \approx \$95.2$.  So A's debt has been somewhat eased by the inflation (and if the term of the loan were much longer the easing could be much greater).  But what about B? In real terms B has lost the same amount that A has gained.

Other things being equal, therefore, inflation benefits borrowers and costs lenders. And in total, amounts lent must equal amounts borrowed. It may be that the the borrowers (government, struggling households) are more visible than the lenders (better-off households, foreigners).  Nevertheless, the effects on lenders, and on incentives for future lenders, cannot be ignored.  Where inflation is expected, lenders will as suggested in Henry's comment demand a higher interest rate to offset their expected loss on the principal repayment.