If a plan allowed that, it would not qualify as a 401k plan. As long as the money is in the plan it's not yours. Once the plan allows you to take it out and you take the money out of the plan it becomes yours - and then you owe the tax on it (and maybe penalties).
Most 401k plans let you take the money out if you leave the employ of the plan sponsor but they don't have to allow that. And most plans will let you take an in-service distribution at age 60 or older but they don't have to do that either.
What you are arguing is that any funds that you deposit in a time account (CDs, Bonds, etc.) are not yours, which is ludicrous!
The 401k money is YOURS; you may withdraw it at anytime, but you must pay tax on the full amount of the withdrawal plus penalty interest.
This sounds like trust law, and I'm not a lawyer.
My 401(k) allows hardship withdrawals for an employee or a lump sum withdrawal if an employee quits
before age 59 ½. It also allows current and former employees to receive the stock dividend as a check mailed
to us instead of reinvesting it in the plan.
Mr. Boehner or Mr. McConnell could hold a press conference and explain why this confiscation won't happen.