BBC News with Jerry Schmitt.

Republicans in the US Senate have blocked a controversial proposal to allow homosexual men and women to serve openly in the American military.

They argue that military readiness will be damaged by

reversal

of the existing policy “don’t ask, don’t tell” which allows gay people to serve provided they don’t reveal their sexuality.

Here’s Paul Adams.

The democrats needed 60 votes to move this legislation forward and in the end they failed by four – two of their own members voting with the Republicans. It’s a

setback

for President Obama who hoped to

deliver on

a campaign promise to

repeal

“don’t ask, don’t tell”. The Pentagon is conducting a study into how repeal might be implemented, but Republicans and many in the military feared that it could damage morale at a time when the armed forces are fighting two wars.

The president of the Vatican Bank, who’s been linked to money laundering, says he can’t understand why he’s been investigated. The president, Ettore Gotti Tedeschi, said he was mortified and

humiliated

since he’d spent a lot of time trying to resolve the problems now being investigated.

“I’ve been in Paris at the Financial Action Task Force and at the OECD to learn all the new procedures. I want to add that we fully accept the regulations from the Bank of Italy. To