Many people use big words and foreign words in order to sound educated. According to Orwell in "Politics and the English Language," what do such words do to a piece of writing?

In this essay, Orwell criticizes the use of "pretentious" words. These include words from Greek and Latin, rather than simple, short everyday—what he calls "Saxon"—words. This language also includes jargon, such as Marxist terminology that functions as a sort of meaningless shorthand, and words translated from foreign terms in Russian, German, or French. All of this language sounds very educated or knowing, but can end up being meaningless. Orwell says it results in an

increase in slovenliness [sloppiness] and vagueness

Orwell also critiques the use of abstract, generalized words, such as values, freedom, socialism, and democracy, saying that these terms too are so vague as to have lost all real meaning. He advocates instead for using concrete words that specifically describe in simple, direct ways what a person is trying to communicate. Trying to sound educated, he argues, can actually degrade the English language and hide an absence of real thought.
In his own writing, both fiction and non-fiction, Orwell uses plain prose and simple, ordinary words that are easy to understand. That is one reason why his work has lasted.

According to Orwell, using large and/ or foreign words has several effects on writing and society, most or all of which are bad.
Orwell develops a number of categories of language use. One of these is "pretentious diction." That's where this sort of language would most often fall. Orwell says people use this sort of inflated language to "dress up" simpler ideas. So, the first impact is to make basic thoughts seem more important than they are. A related issue is that people use this language to make biased perspectives seem objective. That goes beyond an impact on language; it affects society and politics.
Another of Orwell's categories is "meaningless words." Long and foreign words are often meaningless, or close to meaningless. As a result, these words are wasteful.
In general, what Orwell calls "inflated style" works to blur key details and "corrupt thought." It gets in the way of understanding and makes us think worse.