"We can show the world that America will lead the way in building a new consensus on international trade," said Senate Finance Committee Chairman Max Baucus, D-Mont.
The Senate voted 64-34 to restore trade powers that had expired in 1994 but not renewed since. Minutes earlier, senators rejected a final effort to kill it by opponents, who said the bill's cost would exceed budget caps.
The bill, passed last Saturday by the House, now goes to President Bush for his signature.
"This is a historic and great day for America," Commerce Secretary Donald Evans said.
Mr. Bush pressed Congress repeatedly to pass the measure before leaving for the August break, saying its promise of fostering economic growth and jobs would be an important means of reviving the business community's flagging confidence.
White House spokesman Ari Fleischer said Mr. Bush was "very grateful" the Senate was moving on the legislation. "A decade-long trend appears to be breaking and a new trend beginning."
This trade authority is vital if the president is to negotiate new free-trade agreements, reports CBS News Correspondent Bob Fuss. It says Congress can approve or reject a trade treaty, but can't change it.
"This is the kind of authority the president needs to lead this world to peace and prosperity," Evans said. "This will clearly give us the opportunity to go on the offense."
Every president from Gerald Ford on has had fast track authority, but President Clinton failed to revive it after it expired in 1994, largely because of opposition in his own party.
Democratic dislike of fast track comes from beliefs that past trade deals, such as the North American Free Trade Agreement with Mexico and Canada, have led to a surge in imports, a loss of American jobs, exploitation of foreign workers and degradation of the environment.
"We're getting clobbered with this trade deficit," said Sen. Byron Dorgan, D-N.D. "We've been a (trade) leader without a backbone."
At the insistence of Democrats, the renewed negotiating power comes with a package of aid for those who lose their jobs due to foreign competition, including some benefits to help buy health insurance.
Lori Wallach, director of Public Citizen's Global Trade Watch, said it was outrageous that, just a week after Congress passed legislation to crack down on corporate crime, it was "approving corporate deregulation across the board on a global basis."
Sen. Robert Byrd, D-W.Va., a fierce defender of congressional prerogatives, waved his copy of the Constitution and warned that fast track "wrests from the Congress its right to strengthen and protect America's trade laws."
There were some Republican dissenters as well, particularly among House members from citrus and textile states. The administration made some concessions in the bill to bring Florida citrus lawmakers in line. But it lost some textile lawmakers who are concerned that a section extending duty-free treatment for textiles and apparel from four Andean nations could cost thousands of American jobs.
Democratic support was tied in part to a significant expansion of a Kennedy-era program giving financial and retraining support to workers laid off because of trade.
For the first time, those eligible for the Trade Adjustment Assistance program could get tax credits to pay for 65 percent of health insurance costs. Suppliers to import-hit companies would become eligible, as would farmers and ranchers hurt by imports. Some workers whose factories are moved overseas could receive benefits, and a program to compensate older workers forced to take lower-paying jobs would be created.
The additions would nearly double those eligible to about 200,000 and triple spending on the program to about $12 billion over 10 years.
This is "the portion of the bill that I believe is the most historic," said Baucus.
The package also extends for four years a program offering lower tariffs to Colombia, Peru, Ecuador and Bolivia and another program under which the president can give preferential duties to developing countries.