“I want to tell you this: If I become majority leader, one of the first things I will do is we will eliminate it forever,” Schumer said during a July 14 press conference on Long Island. “It will be dead, gone, and buried.”
“It” in this case was the cap on the state and local tax (SALT) deduction, which was imposed as part of the 2017 federal tax reform bill passed by Republicans and signed by President Donald Trump. As a result of that law, Americans are allowed to deduct a maximum of $10,000 in state and local tax payments from their federally taxable income; previously the deduction was uncapped, and it overwhelmingly benefitted the richest households while shifting their federal tax burden to everyone else.
Sen. Bernie Sanders (I–Vt.) is correct to point out, as he did in an interview with Axios this week, that the SALT cap creates a serious optics problem for Democrats. Sanders says he will oppose Schumer’s effort to attach the SALT cap repeal to the transportation bill because “it sends a terrible, terrible message when you have Republicans telling us that this is a tax break for the rich.”
Why it matters: Changes that typically take months or years to show up on a trend line started happening in weeks — resulting in a year of numerical outliers that will be breaking the axis for decades to come.
The result was two-fold:
Y-axes need to be continually adjusted to accommodate ever-higher numbers.
Longer term, there’s now a year of graphical outliers that future charts will have to account for.
Despite looking like a run-of-the-mill short squeeze, what’s happening in GameStop is anything but that, Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners, tells Axios. Short sellers overall are not being squeezed out of the trade, despite having lost more than $6 billion since Jan. 1.
“I’ve talked to several brokers, they’ve got a line of guys looking to short the stock if there’s any stock available to borrow,” even though shorting GameStop now costs a fee of 150%.
“The value shorts are getting squeezed out and being replaced by momentum shorts looking to ride the stock price down the back end of the roller coaster.”