What would happen to PE returns if the carried interest loophole was closed?

I worked in public equities so I don't deal at all with carried interest. Just curious, I think PE does about mid-teens LT returns (coming down rapidly). What would closing the carried interest loophole do to the returns, would it go from 13-15% to 7-9%? Under / over / etc?

 

You would lose all motivation in the industry and everyone would move to Texas and Florida. Returns would drop from 30/50% IRRs at the top funds to -35% as you have to pay rent to be in the industry.

 

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