SENATE PASSES WALL STREET REFORM…. As recently as Wednesday afternoon, the Wall Street reform package, months in the making, was in a bit of trouble. The Senate leadership attempted to end debate and move towards a vote, but fell a couple of votes short of ending a Republican filibuster. It wasn’t clear when the legislation would finally come together.

A day later, the sweeping regulatory reform bill passed the Senate with at least a modicum of bipartisan support. Despite intense industry lobbying and GOP obstructionism, Congress now stands at the brink of approving “the most sweeping regulatory overhaul since the aftermath of the Great Depression.”

The bill seeks to curb abusive lending, particularly in the mortgage industry, and to ensure that troubled companies, no matter how big or complex, can be liquidated at no cost to taxpayers. And it would create a “financial stability oversight council” to coordinate efforts to identify risks to the financial system. It would also establish new rules on the trading of derivatives and require hedge funds and most other private equity companies to register for regulation with the Securities and Exchange Commission. […]

The Senate bill, sponsored primarily by Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the banking committee, would seek to curb abusive lending by creating a powerful Bureau of Consumer Protection within the Federal Reserve to oversee nearly all consumer financial products.

In response to the huge bailouts in 2008, the bill seeks to ensure that troubled companies, no matter how big or complex, can be liquidated at no cost to taxpayers. It would empower regulators to seize failing companies, break them apart and sell off the assets, potentially wiping out shareholders and creditors.

To coordinate efforts to identify risks to the financial system, the bill would create a “financial stability oversight council” composed of the Treasury secretary, the chairman of the Federal Reserve, the comptroller of the currency, the director of the new consumer financial protection bureau, the heads of the Securities and Exchange Commission and the Federal Deposit Insurance Corporation, the director of the Federal Housing Finance Agency and an independent appointee of the president.

The bill would touch virtually every aspect of the financial industry, imposing, for instance, a thicket of rules for the trading of derivatives, the complex instruments at the center of the 2008 crisis. With limited exceptions, derivatives would have to be traded on a public exchange and cleared through a third party.

After ending the Republican filibuster in the afternoon, the final vote last night was 59 to 39. Two Democrats — Washington’s Maria Cantwell and Wisconsin’s Russ Feingold — sided with the minority, arguing that the bill wasn’t tough enough. Four Republicans — Susan Collins and Olympia Snowe of Maine, Massachusetts’ Scott Brown, and Iowa’s Chuck Grassley — broke ranks and voted with the Democratic majority. (Sens. Arlen Specter and Robert Byrd did not vote last night.)

Of particular interest, Sen. Richard Shelby (R-Ala.), the lead GOP negotiator on Wall Street reform, supported the filibuster and opposed the legislation, as did Sen. Bob Corker (R-Tenn.), who also tried to reach a deal with Dodd about moving the bill to the right.

Oddly enough, Corker’s efforts were not only unsuccessful, but in a rare legislative dynamic, the Senate actually kept moving the bill to the left. While the upper chamber is notorious for watering down bills to overcome procedural hurdles, the Wall Street reform bill improved in recent weeks, due in large part to political considerations — the industry is so unpopular, policymakers saw electoral value in toughening up the legislation. It’s a rare instance in which the Senate bill is arguably stronger the House version.

As for what’s next, there will be a formal House-Senate conference, which is expected to take several weeks. The White House will reportedly play a key role in shaping the final package to the president’s liking, and the process is not expected to be especially difficult. While there are differences between the two bills, they’re based on a similar blueprint, and as House Financial Services Committee Chairman Barney Frank (D-Mass.) told reporters yesterday, “It is not a hard bill to conference.”

The goal is still to have the signing ceremony by July 4.

Steve Benen

Follow Steve on Twitter @stevebenen. Steve Benen is a producer at MSNBC's The Rachel Maddow Show. He was the principal contributor to the Washington Monthly's Political Animal blog from August 2008 until January 2012.