It's not unheard of, but it's pretty rare in the history of government finance. I believe this occurred in the French Revolution, wherein the monarchy's finance

It's not unheard of, but it's pretty rare in the history of government finance. I believe this occurred in the French Revolution, wherein the monarchy's finances were in tatters. Ministers of finance took out multiple loans to keep up revenue and hide the clusterfuck of debts, but eventually something had to give...the French simply didn't pay a lot of their debts back due to national emergency and revolutionary upheaval (which came before/during/after this financial move). How the French govt got so indebted was partially exorbitant spending (like helping the US in its revolutionary war vs Britain), but also that they taxed their nobility at 0%. They couldn't change the laws because of a labyrinthine legal system and a power structure packed with 0% paying nobles. This is an extreme version of what we have today, where many rich people avoid taxes and pay effectively lower rates than poor people.