Senate Democratic leaders were eager to pass a Wall Street reform bill this week. But they were sidelined by their own party and were not able to round up 60 votes needed to end debate on the legislation, a failure which will at the very least stall final passage.
The Senate voted 57-42 on the motion, losing three Democratic votes.
Sens. Russ Feingold, D-Wis., and Maria Cantwell, D-Wash., voted against ending debate and Sen. Arlen Specter, D-Pa., was a no-show after losing his primary Tuesday night.
Feingold said he voted against the bill because it lacked key reforms, including a provision that would put a firewall between banks and Wall Street firms.
"The test for this legislation is a simple one -- whether it will prevent another financial crisis," Feingold said. "As the bill stands, it fails that test."
Democrats huddled for more than an hour Wednesday in an effort to work out a deal on the bill, which aims to increase oversight and regulation of the nation's financial firms in order to prevent another massive meltdown.
Cantwell said she is unwilling to vote for the bill until it includes a provision that would provide stronger federal enforcement over derivatives trading. Senate Banking Committee Chairman Chris Dodd, D-Conn., had removed that language earlier in the day. Cantwell is also seeking language that would separate commercial and investment banking, a provision Feingold also demands. Cantwell said such a provision would prevent bank deposits from being used in risky Wall Street speculation.
"Until she is able to get those amendments, she is not prepared to vote for cloture," her spokesman said.
Democrats picked up two Republican votes from Olympia Snowe and Susan Collins, both of Maine.
Senate Majority Leader Harry Reid, D-Nev., has continued to blame the delays on Republicans, despite the conflict within his own party.
Most Republicans are opposed to the bill, and believe it will overregulate small businesses and hurt the economy while not doing enough to prevent big government bailouts. Republicans say the bill is flawed because it does nothing to regulate the financially troubled, government-owned mortgage buyers Fannie Mae and Freddie Mac.
"There's no way it can be viewed as a serious effort to rein in Wall Street or to address the problems that caused this crisis," said Senate Minority Leader Mitch McConnell, R-Ky. "I mean, how do you explain to the average American that a bill that was meant to rein in Wall Street can be supported by Goldman Sachs and Citigroup but opposed by car dealers, dentists, florists, furniture salesman, plumbers, credit unions, and community banks?"