President Obama still hasn't learned the classic First Rule of Holes: When you're in one, stop digging. Up to his earlobes in failed stimulus grants and tainted federal loan guarantees, the shoveler in chief tunneled forward this week on his latest Government Loans to Nowhere bill. His willful ignorance is America's abyss.
Little noticed in the White House jobs-for-cronies proposal is a provision creating yet another corruption-friendly "government corporation" that would dole out public infrastructure loans and loan guarantees.
Because, you know, the government-chartered, political hack-stacked Fannie Mae and Freddie Mac "public-private partnerships" -- which have incurred an estimated $400 billion in losses while enriching bipartisan Beltway operatives -- worked out so well for American taxpayers.
The new monstrosity, dubbed the "American Infrastructure Financing Authority" (AIFA), would "provide direct loans and loan guarantees to facilitate investment in economically viable infrastructure projects of regional or national significance," according to the White House plan.
President Obama would have the power to appoint AIFA's chief executive officer and a seven-member board of directors. No doubt the nominees would include the likes of AFL-CIO Chief Richard Trumka on the left and the U.S. Chamber of Commerce on the right -- strange Obama bedfellows who have formed a Big Labor-Big Business-Big Government alliance supporting Obama's infrastructure slush fund.
In addition, a new bureaucracy to support AIFA would be created, including a "Chief Lending Officer" in charge of "all functions of AIFA relating to the development of project pipeline, financial structuring of projects, selection of infrastructure projects"; the "creation and management of a Center for Excellence to provide technical assistance to public sector borrowers in the development and financing of infrastructure projects"; and creation and funding of "an Office of Rural Assistance to provide technical assistance in the development and financing of rural infrastructure projects."
In its first two years, AIFA would rake in $10 billion in congressional appropriations; $20 billion over the next seven years; and $50 billion per fiscal year after that. How would Obama ensure the loan review process is protected from special interest favor-trading and White House meddling? If the ongoing, half-billion-dollar stimulus-funded Solyndra solar company loan debacle is any indication, the answer is: not very well.