Great post, you basically nailed it. I'd label it as symptmatic of "crony capitalism" or the "kleptocracy". It's a fail safe "spending device" to ensure some constant demand and to curry political favor. I hate it just as much as the next guy, but I've been watching this sort of shit become so commonplace that I hold absolutely no illusions about the reality of how things work in the "real world".
Not suprised. When private sector demand dries up, we see the public sector get "real busy" with their pet projects to always ensure that their budgeting gets increased. Remember all those stories in the 1990's about how certain departments HAD to figure out ways to burn cash or else have their funding requests negated in future years. It's all about waste, so as to have a continual amount of funding allocated towards whatever pet project comes along thru the pipeline down the road.
Wondering why SEC is not regulating the market capitalization of listed companies while FED regulates the reserve ratio of banks?