It's not just string, but any long thin item (think tinsel from a Christmas tree).
The worst case of a "string foreign body" that I had was sewing thread that was looped around the tongue and the other end was coming out the rectum. I had to make multiple enterotomy incisions (cutting the intestine) to retrieve the string.
The problem is created because the string spreads out along the intestine and as waves of contraction happen, the string acts like a saw and eventually cuts through the intestine.
If caught it time, recovery is usually complete and no long term effects occur.
Doug, DVM