"I will not support additional spending in a second stimulus package," Bennet said. "Any new transportation initiatives can be funded through the Recovery Act, which still contains unused funds. Public-private partnerships that improve our infrastructure are a good idea, but must be paid for, should not add a dime to the deficit, and should be covered by unused Recovery Act dollars. We must make hard choices to significantly reduce the deficit."
The six-year plan, White House officials said, would be fully paid for, but officials did not say exactly how, beyond saying that some funding would come from closing tax loopholes exploited by oil and gas companies. Officials also acknowledged that details still have to be worked out on how to insulate the plan from the political gamesmanship that frequently plagues spending projects. The bank, they said, would use "performance measurement" and competitive practices to dish out the money.
William Galston, a senior fellow at the Brookings Institution, praised the administration's proposal, saying that it "offers a welcome new direction in an increasingly shrill and decreasingly productive economic debate. It shifts the focus toward the kinds of public action that can help build a more efficient and competitive economy in the long run."
"It's not going to increase infrastructure spending," Morici said. "It's only going to change the source of finance from bond financing to this bank. The municipalities and states are limited in how much financing or obligations they can take on. If they borrow from this Infrastructure Bank instead of the bond market, it still has the same impact on their bonding rates."
"This is another election year ploy from Obama," argued Morici. "He is basically putting out one deceptive program after another this week in an effort to save [Speaker of the House] Nancy Pelosi and it's not going to work. Instead of lending from the right hand, you lend from the left hand. It'll have no impact on infrastructure or employment this year or in the near future."
In addition, the very idea of a government-run bank could prove to be politically dicey at a time when lawmakers fighting for their political lives are loathe to argue for more government involvement in the private sector.
"What the President touted as the 'recovery summer' is built upon the misguided notion that government expansion creates prosperity, when it reality it has continued to drive debt and deficits," said Cantor.
One Senate GOP aide even suggested to ABC News that the administration's proposals "seem designed to fail," denouncing them as "PR stunts to get some headlines."
However, a House Democratic aide countered that the National Infrastructure Bank proposal has "broad support" on Capitol Hill. "The momentum is definitely building," the aide told ABC News. "The reaction [to the proposal] has been great."
Partisan opposition? The upcoming elections? The backlash against big government / Key questions left unanswered. President Obama just finished proposing his new infrastructure plan, but it's already encountering roadblocks in its path.