It means that you get long periods with no functioning government at all and when one does happen it tends to be unable to do anything coherent whilst simultaneously becoming committed to a handful of bizarre and extreme policies that the small parties demanded. It also leads to frequent collapse and re-runs of elections that yield the same deadlock.

The idea that FPTP must yield a two party system isn't right anyway. The UK uses FPTP and has quite a few different parties that routinely challenge the big two in major and impactful ways (SNP, Lib Dems, UKIP, Reform etc).