Publishers aren't necessarily the villains here, except in the regular way all middle men are the villains. Authors want to make money, and they make money by selling books. If a library can digitally loan the book an unlimited number of times in parallel, it's a bad deal for the author.
The "this book automatically explodes after 2 years or 10 rentals" system is a stupid compromise, but any solution is gonna be some sort of system to send money from libraries to companies based on how many people read the book.