(CNN) - In yet another sign that Congress is headed for a clash in the fall over government spending, Senate Republicans Thursday blocked a transportation and housing bill, arguing it would break budget spending caps.
It was a significant defeat for Democrats and a win for Senate Minority Leader Mitch McConnell, R-Kentucky, who persuaded several Republicans who had previously voted to support the higher spending level to change their positions and vote to block the bill.
"We think this vote is of symbolical significance going into the fall when we will have, obviously, the inevitable discussion about how to fund the government," McConnell said.
Senate Democrats and House Republicans disagree on how much money should be available to fund the various agencies of government. Republicans want spending for next year to reflect the automatic spending cuts required by the sequester. Democrats, who believe those cuts are hurting job creation, want to reverse them and spend at a higher level.
Senate Majority Leader Harry Reid said he was "terribly disappointed" by the vote.
"I can't understand why Republican leadership over here would twist arms to derail a bipartisan bill that creates jobs all over America," he said.
The vote came a day after House GOP leaders pulled their chamber's version of the bill. They said there wasn't enough time to finish the measure before the summer break, but there were also questions about whether there were enough votes to pass it. In the House, moderate Republicans joined Democrats in opposing deeper spending cuts.
House Republican Appropriations Chairman Hal Rogers issued an unusually blunt statement saying the decision by GOP leaders to yank the bill meant the chances for passing it in September were "bleak at best."
In the Senate, Susan Collins of Maine was the only Republican to support the bill even though six supported it when it passed out of committee and 19 voted to begin debate on the floor.
Shortly before the vote, Collins struggled to be heard over the din of her colleagues as she rose to speak in favor of the bill.
In a sign of how high tensions are in the Senate just before senators leave for the five week break, Reid angrily instructed Sen. Tammy Baldwin, D-Wisconsin, who was presiding, to get order.
"Have the senators sit down and shut up, okay," Reid yelled with frustration. "It's unfair."
Ironically, immediately after the vote, most senators went to bipartisan caucus, which was aimed at improving relations between the two parties. Barbeque was served.
"Everybody talked with those at their tables and we flip-flopped tables and switched around," said Sen. Johnny Isakson, R-Georgia, an organizer of the second annual event. "It's been a good effort to get people to break bread together and talk together and find common ground."