WASHINGTON — Sen. Arlen Specter's defection from the Republican Party on Tuesday threatened to shake up the conventional wisdom surrounding the future of several banking bills and hand the Democrats more power as they seek to overhaul the financial services sector.

With its fractious politics and resistance to speedy change, the Senate is the big hurdle for many proposals that have won popular support in the House, including regulatory restructuring, mortgage bankruptcy and credit card reform.

By putting Democrats within reach of the 60 votes necessary to block a filibuster, Specter's switch gives Senate leaders more leverage to pass legislation without courting Republican votes.

"This is a huge move because this really cements the Democrats' ability to reshape financial regulation at will at a crucial time for American economic growth and the future of capitalism," said Joseph Mason, a professor of banking at Louisiana State University. "We've got a lot of crucial legislation coming down the pike."

Specter's move gives Democrats 59 votes in the Senate, but Al Franken is expected to prevail in a Minnesota court battle and become the chamber's 60th majority vote.

The move does not guarantee that financial services bills will start sailing through. A few moderate Democrats have expressed reservations about a pending bill to rein in credit card practices, for example, while Specter remains opposed to a bill that would allow judges to rework mortgages.

"There are still a number of Democrats who question the more extensive consumer protection bills in the banking world that Democratic leaders want to advance," said Jaret Seiberg, a policy analyst with SMH Capital Inc.'s Washington Research Group. "You're still going to have trouble rounding up the 60 votes you need to move the most radical agenda."

But a Democratic supermajority does roil the political calculus surrounding these and other bills. Before Specter's move, Democrats had to line up near-unanimous support of their own caucus and still seek at least one Republican defector — a difficult maneuver if GOP leadership is putting pressure on members to oppose the bill. If Franken is seated, Democrats will only have to negotiate among themselves, resulting in a bill that may be less business-friendly.

"Presumably it's easier to get a fellow Democrat to support something than a Republican," said Bert Ely, an independent consultant in Alexandria, Va.

That puts moderates, such as Specter, front and center. The Pennsylvania lawmaker adds weight to a coalition of moderate Democratic senators, including Tim Johnson of South Dakota and Evan Bayh of Indiana — both members of the Senate Banking Committee.

"It does raise the profile" of moderate Democrats, said Brian Gardner, a political analyst with KBW Inc.'s Keefe, Bruyette & Woods Inc. "They were doing that on their own with things like the cramdown and the stimulus … but their profile is now going to increase."

Democrats also have the power to use more procedural tricks to pass legislation. Under Senate rules, it takes 60 votes to limit debate on a bill and prevent a filibuster through a process called cloture. After cloture, however, a bill just needs a simple majority to pass.

Several lobbyists interviewed Tuesday said it was likely Senate leaders could pressure wavering Democrats to vote for cloture, and allow them free rein to vote against the final bill. The maneuver, while politically risky, allows lawmakers to claim credit for opposing a bill while not standing in the way of its passage.

"On the major priorities, it is really going to increase the ability of Democrats to get things done," said an industry lobbyist who spoke on condition of anonymity.

Exactly how Specter's defection changed the fate of individual bills was still a matter of intense debate Tuesday. Most observers said Specter is likely to remain opposed to mortgage bankruptcy reform, but his views on credit card reform are murkier. Senate Banking Committee Chairman Chris Dodd passed a bill out of his panel last month that would crack down on several card practices. The legislation lost the support of Johnson and was opposed by the Republicans. Senate leaders are aiming for a floor vote on the bill next week — and it is unclear if the bill will be altered to attract more support.

Specter did not directly address banking issues during a press conference Tuesday but he hinted at discontent with Republican prescriptions for resuscitating the economy. "When the stimulus package came up for a vote, I felt it was indispensable to vote 'aye' in order to avoid the possibility of a 1929-type Depression," he said.

But Specter also said he would not always side with Democrats.

"I will not be an automatic 60th vote," he said.

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