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I mean, it almost is.
The major construction operations know by now how to game the system and how to milk the state for as much money as possible to complete a project after intentionally underbidding it. The play is not money laundering, per se, since the money all comes from public funds. The con is rather to drag feet and rack up as many man-hours and the biggest most padded materials invoice possible to get paid more so the management can pocket the difference.
There was a scandal in my state where a big construction company did this blatantly enough that even the uninformed public noticed, and after the inevitable lawsuit a judge finally had to step in and smack them with a per-day fine until they completed the work. This was because it was discovered that they were intentionally delaying in order to run out of their originally allotted budget so the could come crying back to the state for more, under the assumption that since the job was half finished the state would be forced to capitulate. Turned out, it didn't work out that way this time.
I think this is less a case of a cabal in the back of some dark and smoke filled room, but more of capitalism mutating to its inevitable conclusion when the same players have had their same hand in the same cookie jar placed there by the same system for decades on end, with no functional oversight.
For proof of this just look at the Alaskan Highway. During World War 2 the Army built a 1,700 mile long highway from British Columbia to Alaska. There was zero infrastructure or existing routes along the way. Also they had to deal with mountains, permafrost, and all sorts of stuff using 1940s technology. Construction started in March 1942 and was completed in October of the same year. Or 7 months.
For comparison here in DFW they built an overpass between Hwy 820 and I-35W. No actual new roads, just a new overpass. It took them 7 fucking years.