[iknowSFR]

I would love to see a multi-decade model of 4 scenarios measuring quality of life, economic growth, and wealth distribution specifically around the re-allocation of this $12T.

1. Baseline Status quo - no changes.

2. Move all $12T into reducing the $36T of US debt. 1 time payment. All 401k’s are reduced to $0.

3. Allow for PE to productize into this $12T, siphoning off various amounts over time.

4. 401k holders can choose their own non-traditional investments.

I’m not advocating for any specific outcome because I know nothing on this topic but as a starting point, show me what happens with each, normalized and compared.

[nobodyandproud]

Expecting anyone to model and quantify in a hacker news comment is borderline unrealistic.

But hot-takes are another matter:

4 is basically #1: Every "non-traditional" investment can be made into an ETF (and for that matter, mutual funds) provided it aligns with SEC and/or exchange rules. Still, PE funds probably won't get a lot of takers by individual company's fund admins even if they're allowed. They're quite conservative, and rightly so.

2 & 3 would both cause the equivalent of modern bank runs. American financial institutions would be in tatters.

And as an individual why not? I can withdraw from a 401k, with just a 10% penalty plus income tax. Rationally, this is still better; especially if the highest tax brackets are favorably cut-down thanks to our conservative madmen. Which means the safest course of action is to withdraw it in chunks; then place it into safer investment vehicles and nations.

Of course, what would really happen is something more catastrophic as this withdrawal dovetails from thousands to millions.

Finally, with so many nations and wealthy also invested into the US, this then turn into more than just a US problem as it becomes hard/impossible to offload US financial assets.

[altairprime]

You’re advocating that the household quality of life of the masses is worth considering. That precept is not held by private equity, and that taints the otherwise neutrality of the question. (I am strongly against neutral positions, but it weakens your argument as presented to have invalid neutrality, and I’m even more strongly against private equity, so.)

[iknowSFR]

I’m not following this. Can you explain a bit more plainly?

[altairprime]

> I would love to see a multi-decade model of 4 scenarios measuring quality of life, economic growth, and wealth distribution

“Spending money studying quality of life is a waste of good money that could be making us wealthier.” - Private Equity

“Wealth distribution doesn’t need to be studied. Distribute your wealth to us, obviously.” - Private Equity

Claiming that those deserve studies is to suggest contradiction of those two beliefs, which I’m representing here as quotes based on my best-faith summary of their industry’s actions to date. People tend to react with hostility when someone suggests that their beliefs might be mistaken, especially when peacefully allowing debate to occur might reduce their future earnings.

> I’m not advocating for any specific outcome

Your question itself advocates for a reevaluation of the validity of those two beliefs, an outcome that you value as higher importance than complying with Private Equity’s values, so this declaration of “not advocating” is false. And since simply posing your question alone is enough to antagonize Private Equity, some of which is here on HN participating, any attempt to avoid doing so is impossible if you want to question their beliefs. (I support this!).

It’s plainly apparent that you have an opinion, or else you wouldn’t be interested in these questions at all. Consider reworking your approach to more clearly state why this matters to you personally and what you’re advocating for. For example, ‘I think private equity is operating under the false assumption that they benefit quality of life, aka trickle down, and that we should disprove that’. (My example is not intended as a valid expression of your opinion, it’s just a stylistic sample.)

[MattPalmer1086]

I actually find the parent much clearer than your criticism of their lack of clarity!

You assume that they are secretly advocating for something, on the basis that quality of life isn't something private equity cares about (according to your own assumptions). Even if it isnt, so what?

I took would be interested in seeing the proposed model of the different scenarios and I am also not secretly advocating for any particular outcome.

[altairprime]

Unknowingly, more likely; not ‘secretly’. I don’t think there’s any intent to withhold an opinion, but the willingness to question precepts at all is itself an opinion (and one that I agree with regardless of topic). Literal religious wars have been fought over that sort of willingness, so I tend to state it more plainly than is typically comfortable.

[MattPalmer1086]

Got it, thanks. So stating "quality of life is also an important factor, this should be part of any analysis" would be a more up front way to motivate the request.

[xmichael909]

Interesting, steal everyone's 401k ... Great idea.

[iknowSFR]

That appears in the cards already. In reality, it’s a question of when the money will end up with PE?

What I’m curious about is if you moved all of it to cutting the national debt by 1/3, what happens? Is there a new lifeline for the nation’s economy?

[nobodyandproud]

I put my hot takes here: https://news.ycombinator.com/edit?id=43528306

[Spooky23]

I love how you’ve decided that my property, because I chose to invest in a tax privileged account, is somehow in the scope for you appropriate/seize and hand off to some third party. Steal my meager savings to avoid currency devaluation and inconvenience some uber rich people.

I regret that I lack the vocabulary to express my position on this. “Go fuck off” doesn’t capture it.

[s1artibartfast]

Isnt #4 already possible? My understanding is that you can just move the 401(k) funds to an IRA, and invest as you like.

[delfinom]

So with #2, steal everyone's money, even people contributing into 401k while making dogshit pay, and pay off the country's debt bill ran up by someone else?

I can tell you this scenario results in french revolutions

[lesuorac]

Everybody loves to quote french revolution or 2nd amendment but all these revolutions are all centrally lead (by somebody/group performing a power grab).

Whose leading the revolution against 401k theft? Is Vanguard going to invite people with 401ks to a rally in DC?

[sofixa]

The French revolution wasn't lead centrally, it was a higher classes which boiled over to grassroots explosion of public discontent that ran away from everyone, had a life of its own, and devoured its children.

Economically, little changed for the regular people. The church was ruined, and so were many high class families. Socially, a lot did (there was an expectation of humans having rights, the church was forever relegated to a secondary role and out of governance, etc).

Most social revolutions (changing the social order, so the US war of independence doesn't count) have a grassroots component that is often highjacked by educated professionals (lawyers are a bit overrepresented) for their own social and economic agenda (which, to be clear, is a net positive compared to the previous order)

[asdffdasy]

when you put it like that, it might actually works. Specially now that the people stealing the 401k will be ones shadowbanning all the angry tweets.

also: see the preemptive strike on revolutions https://gking.harvard.edu/files/gking/files/censored.pdf?mod...

[bloopernova]

Alternatively, raise taxes on billionaires to pay down the debt.

[nobodyandproud]

Discouraging the over-accumulation; or better yet, encouraging that the wealth--once you "make it"--is used for legacy (of the country) is the bargain in the US.

Taxes and institutions could help achieve this, but I also like how Bill Gates has been doing things; but the scale of effort like this and by the billionaire club is paltry and usually political to our collective detriment.