Senate agrees to move forward on financial legislation

WASHINGTON — The Senate agreed Wednesday to end a three-day stalemate and move ahead with formal consideration of historic legislation to overhaul the nation's financial regulatory system.

Efforts to craft a bipartisan agreement broke up Wednesday, with Republicans, who had stalled the bill, getting few if any concessions and perhaps starting to suffer some political consequences.

The Senate next will begin debating and voting on possible changes to the massive bill, which would order the biggest overhaul since the Great Depression of how the government oversees financial institutions.

The Senate should take about a month to work through the legislation, and if it passes, it will have to be reconciled with a different version that the House of Representatives passed last year. Then each chamber must pass identical versions before President Obama could sign it into law, which is unlikely before July.

Senate Banking Committee Chairman Christopher Dodd, D-Conn., promised a Senate debate that would allow time for all points of view. "It is time for debate to begin," he said, "and it must be a serious, vigorous debate."

Republicans remained guarded about the bill. "I continue to be concerned about several provisions," said Sen. Susan Collins, R-Maine, who's in the small band of party moderates that Democrats hope to win over.

The bill would make it easier for the government to move fast to dissolve troubled financial companies that pose a risk to the economy, and would create a tough new consumer-protection agency to keep an eye on mortgages and other forms of consumer credit.

It also would require big banks to spin off divisions that trade in derivatives — exotic financial instruments that helped cause the recent recession — and would bar them from proprietary trading of them for their own accounts if they also trade on behalf of clients.