4 ms·

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-allocatio

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.

delfinom 2y ago
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 2y ago
  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?
  - asdffdasy 2y ago
    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=article_inline https://gking.harvard.edu/files/gking/files/censored.pdf?mod...
  - sofixa 2y ago
    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)
  - FreebasingLLMs 2y ago
    [dead]
altairprime 2y ago
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 2y ago
  I’m not following this. Can you explain a bit more plainly?
  - altairprime 2y ago
    > 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.)
xmichael909 2y ago
Interesting, steal everyone's 401k ... Great idea.
- iknowSFR 2y ago
  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 2y ago
  I put my hot takes here: https://news.ycombinator.com/edit?id=43528306 https://news.ycombinator.com/edit?id=43528306
Spooky23 2y ago
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.
bloopernova 2y ago
Alternatively, raise taxes on billionaires to pay down the debt.
- nobodyandproud 2y ago
  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.
s1artibartfast 2y ago
Isnt #4 already possible? My understanding is that you can just move the 401(k) funds to an IRA, and invest as you like.
nobodyandproud 2y ago
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.

delfinom 2y ago

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 2y ago
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?
- asdffdasy 2y ago
  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=article_inline https://gking.harvard.edu/files/gking/files/censored.pdf?mod...
- sofixa 2y ago
  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)
- FreebasingLLMs 2y ago
  [dead]

altairprime 2y ago

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 2y ago
I’m not following this. Can you explain a bit more plainly?
- altairprime 2y ago
  > 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.)

xmichael909 2y ago

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

iknowSFR 2y ago
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 2y ago
I put my hot takes here: https://news.ycombinator.com/edit?id=43528306 https://news.ycombinator.com/edit?id=43528306

Spooky23 2y ago

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.

bloopernova 2y ago

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

nobodyandproud 2y ago
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.

s1artibartfast 2y ago

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

nobodyandproud 2y ago

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.