Senate clears way for final vote on financial reform bill

Three Republican senators from the Northeast join majority Democrats to advance a financial reform bill to tighten regulation of Wall Street.

By , Staff writer

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    President Barack Obama makes a statement on the financial reform bill, Thursday, in the Rose Garden of the White House in Washington.
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Senators voted 60 to 40 Thursday to end debate on the financial overhaul bill, virtually assuring the legislation will win final Senate passage.

That’s a big step forward for Wall Street reform. The chances are now good that President Obama soon will be able to sign the legislation into law and check it off his “to do” list – something he’s already done for health-care reform.

In turn, that means Democratic lawmakers in the fall may have two big pieces of finished business on which to campaign.

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“The president has to be very, very happy ... this is a major victory for him,” said Sen. Bob Corker (R) of Tennessee after Thursday’s vote. “In my opinion it’s an overreach. I think we could have done better.”

Mr. Obama is indeed pleased. He heralded Thursday's vote, saying Wall Street efforts to undermine the legislation had failed.

"Our goal is not to punish the banks," he said, "but to protect the larger economy and the American people from the kind of upheavals that we've seen in the past few years. Today's action was a major step forward in achieving that goal."

Two Democratic holdouts

For Democrats, the road to cloture perhaps was bumpier than they had anticipated. On Wednesday, an initial attempt to limit debate and clear the way to final passage fell just short, with key opposition coming from within the Democratic caucus. Sens. Maria Cantwell (D) of Washington and Russ Feingold (D) of Wisconsin both voted “no," indicating they wanted the bill toughened.

Senators Cantwell and Feingold voted “no” again on Thursday. But three Republicans – Massachusetts Sen. Scott Brown and Maine Sens. Olympia Snowe and Susan Collins – voted “yes,” assuring narrow approval of the effort.

“It’s been hard to get to this point,” said Senate majority leader Harry Reid of Nevada in the moments after the vote.

What Wall Street can expect

The financial overhaul bill is the most sweeping attempt to rein in Wall Street since the 1930s. It would establish a new consumer protection agency, set up a council intended to watch for and prevent another financial meltdown, and toughen regulation of the complex securities known as derivatives, among other things.

Under Senate rules, up to 30 hours of debate remain following cloture approval. A simple majority is needed for final approval of the bill.

Amendments yet to be voted on include a proposal to prohibit banks from making speculative trades with their own money, and a proposal to exempt auto deals from the oversight of the new consumer protection agency.

Democrats were jubilant after Thursday’s victory. Republicans tried to criticize some of the content of the legislation without appearing supportive of Wall Street bankers.

Senator Corker, for example, said he was “shocked’ by the extent of the powers of the new consumer agency and “disappointed” that the bill did not address issues at Fannie Mae and Freddie Mac, the big government-controlled mortgage entities.

When it comes to bad loans, Fannie Mae and Freddie Mac have been “enablers,” said Corker.

Associated Press material was used in this report.

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