The Senate approved far-reaching new financial rules today aimed at preventing the risky behavior and regulatory failures that brought the economy to the brink of collapse two years ago and cost millions of Americans their jobs and savings.
The vote was 59 to 39, with four Republicans joining the Democratic majority in favor of the bill. Two Democrats opposed the measure, saying it was still not tough enough.
"When this bill becomes law, the joy ride on Wall Street will come to a screeching halt," Majority Leader Harry M. Reid (D-Nev.) said after the vote.
The 1,500-page measure, shepherded through the Senate by Christopher J. Dodd (D-Conn.), chairman of the banking committee, seeks to reshape both Washington and Wall Street.
In providing for the most profound remaking of financial regulations since the Great Depression, the legislation would create a new consumer-protection watchdog -- the Consumer Financial Protection Bureau -- housed at the Federal Reserve to prevent abuse in mortgage, auto and credit card lending. It also would give the government power to wind down large failing financial firms and set up a council of federal overseers to police the financial landscape for risks to the global economy.
The legislation also establishes oversight of the vast market in derivatives, impose new restrictions on credit rating agencies and give shareholders a say in corporate affairs.
Democratic Congressional leaders and the Obama administration must now work to combine the Senate measure with a version approved by the House in December, a process that is expected to take several weeks.