Why do people think that taxation follows a simple accounting mechanism of collect-and-spend? Taxation is collateral for a soverign to get loans and bonds. Taxes do not pay for anything.
If it's a federal loan, the government will garnish your wages [1] and eventually your social security payments [2], and will withold any tax refunds. And since student loans usually can't be discharged in bankruptcy, you'll have bad credit for literally the rest of your life.
Also, you pay income tax on forgiven loans, not defaulted ones.
