The Senate on Wednesday voted down a Democratic proposal to temporarily restore interest rates on federally subsidized student loans that doubled last week, as Republicans and some Democrats pressed for a long-term solution.

A procedural vote on a proposal pushed by Senate Majority Leader Harry Reid, D-Nev., to freeze the interest rate on new federally subsidized Stafford loans for one year at 3.4 percent failed 51-49, falling short of the necessary 60 votes.

No Republicans supported the plan, while Sen. Joe Manchin, D-W.Va., and Maine independent Sen. Angus King, who caucuses with Democrats, opposed it. Reid switched his yes vote to no on a procedural tactic that allows him to reintroduce the bill later.

The interest rate jumped to 6.8 percent on July 1 from 3.4 percent after Congress failed to agree on a plan to keep the rates from rising.

The rate increase didn’t immediately affect most college students, as loans documents typically are signed in the days and weeks before fall semester. And the increase doesn't apply to existing loans.

But unless Congress acts soon, the increase could mean an extra $2,600 for an average student returning to campus this fall, according to Congress’ Joint Economic Committee.

While Congress had been eager to avoid the interest rate from doubling, the parties couldn’t agree on an approach. Senate Republicans pressed Democrats to accept a House-passed bill that ties interest rates to the financial markets, a plan similar to a proposal from President Obama.

But Manchin and King have bucked their leadership and joined several Republicans to press for a plan along the lines of the House GOP-Obama proposals, which offer a long-term fix that links interest rates to the 10-year Treasury note. The proposal would make loans available to all students, as opposed to the Reid plan, which offers loans only to those who demonstrate financial need.

Under the bipartisan plan, student loan interest rates for undergraduates, as of today, would be 3.66 percent.

Critics argue that because of Wall Street fluctuations, student loan interest rates could unexpectedly swing upward if tied to the financial markets. But backers of the bipartisan Senate plan say their proposal includes caps and other measures to keep rates stable.

"If Congress tries to set a rate, it will always be wrong,” King said. “And that's one of the reasons why I didn't support an extension, because we would've been extending a system that's forcing students to overpay.”

Now that Reid’s approach has failed, Manchin said he’s confident all sides will come together soon on a compromise.

"We want to help 100 percent of the students who are out there borrowing money,” Manchin said. “We think we're in a very productive mode, we think this will be done.”

King said it’s not farfetched to expect a deal worked out within the next day, though he cautioned against getting too optimistic.

“We're pretty close, but around here it ain't over til the votes,” he said.