DealBook Briefing: Wall Street’s Fear Gauge Jumps on Flynn News

Remember that the VIX tracks investor expectations of how volatile stock markets will be in the month ahead. The possibility that Mr. Flynn could implicate senior White House officials in Mr. Mueller’s investigation would certainly throw the markets into high uncertainty.

Major stock indexes have pulled back today as well, despite the tax news. The Standard & Poor’s 500 index was down nearly 1 percent at 2,622.12, while the Dow Jones industrial average was down a more modest 0.6 percent, at 24,120.72.

More potential holdouts back the Senate tax plan.

Two Republican senators who had previously opposed the bill for its treatment of so-called pass-through businesses, Ron Johnson of Wisconsin and Steve Daines of Montana, now say they will vote for the legislation.

What convinced them? Tweaks to how pass-through businesses are treated:

The Senate tax bill allows pass-through owners to deduct 17.4 percent of their business income as a way of lowering their taxes. Republicans were planning to increase the deduction to 20 percent to address the concerns over how pass-through owners were being treated by the bill.

Now, the deduction is to be raised to 23 percent, an aide to Mr. Daines said.

The remaining holdouts include Susan Collins of Maine and several senators concerned about the bill’s effect on the deficit.

The issues that still need to be addressed in the Senate bill.

Senators are still expected to vote today on the proposal. But its chances of succeeding may come down to whether deficit hawks in the Senate like Bob Corker of Tennessee can be convinced that the overhaul will not add to the national deficit. Last night, lawmakers were pushed to remove a provision that would have automatically raised tax rates if economic growth did not prove strong enough to pay for cuts.

That’s on top of other bad news for Senate Republicans, including the Joint Committee on Taxation finding that the bill would add $1 trillion to the deficit, though G.O.P. officials largely dismissed that conclusion. Here’s a handy breakdown of various analyses of the bill’s potential effect on the deficit.

How Republican leaders are proposing to find at least $400 billion in new revenue

• Slowly raising corporate rates above 20 percent

Huge automatic cuts to government programs, from Medicare to farm subsidies to student loans

The big problem

According to Caitlin Owens of Axios:

Aides say they still hope to bring all 52 Republicans to…

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