setuptools fails to install package yet returns success

tl;dr python setup.py install fails to build the package. Process return code is 0, should be !0

Reproduction

Given test code files

./setup.py
./setuptools_test1/code.py
./setuptools_test1/__init__.py

Where ./setup.py is

from setuptools import setup
setup(
    name='setuptools_test1',
    version='0.1',
    packages=['setuptools_test1'],
    install_requires=[]
)

Where ./setuptools_test1/code.py is

#!/usr/bin/env python3.7
print 'bad python 3 code'

Where ./setuptools_test1/__init__.py is an empty file.

Create a virtual environment (using Python 3.7). Activate it.

$ virtualenv --python=python3.7 .venv-3.7
...
$ source .venv-3.7/bin/activate

Run setuptools install. Notice failure and success return code (output abbreviated)

$ python3.7 setup.py --verbose install
running install
...
copying build/lib/setuptools_test1/__init__.py -> build/bdist.linux-x86_64/egg/setuptools_test1
byte-compiling build/bdist.linux-x86_64/egg/setuptools_test1/code.py to code.cpython-37.pyc
  File "build/bdist.linux-x86_64/egg/setuptools_test1/code.py", line 2
    print 'bad python 3 code'
                            ^
SyntaxError: Missing parentheses in call to 'print'. Did you mean print('bad python 3 code')?

byte-compiling build/bdist.linux-x86_64/egg/setuptools_test1/__init__.py to __init__.cpython-37.pyc
creating build/bdist.linux-x86_64/egg/EGG-INFO
Finished processing dependencies for setuptools-test1==0.1

$ echo $?
0

Return code 0 will not stop callers from continuing processing, leading to more confusing problems much later in a workflow. setuptools needs to signal failure to the caller with a non-zero return code.

Additionally, setuptools continues to process further byte-compiling operations despite the failure. By default, it should gracefully exit after any byte-compiling failure.

Some users may want setuptools to continue in spite of byte-compile failures (some users may need the current behavior)? Perhaps a flag could be added, like --ignore-compile-failures.

---

version tested

$ python3.7 --version
Python 3.7.1

$ python3.7 -c 'import setuptools;print(setuptools.__version__)'
41.0.1

Reproduce the failure with the minimal setup.py and setuptools_test1/code.py example using Python 3.7 and python setup.py --verbose install. Trace the install entry point and byte-compiling behavior; done means a byte-compilation failure returns a non-zero status and stops by default, with any opt-out behavior explicitly defined.