alt Hacker Newsthey might be pissed off, but would lack standing to take land or something else instead. Ultimately you are fine, just without the ability to take on more debt. you get to keep your assets.
the scale of problem is much worse when Haiti was forced to pay France a debt for freeing itself of slavery. Having to produce physical goods and sell them is much harder than giving out paper or adjusting numbers
What you're describing is identical with simply defaulting on loans and say "we're not going to pay you back".
Inflating away your currency has the same effect with the added downside of destroying your economy simultaneously.
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In fact, the only time I can really see the argument for wanting the ability to inflate away currency to escape debt is if the country is weak and in a precarious enough position that they are legitimately worried that actually formally defaulting would lead to an invasion.