American taxpayers’ finances are being sucked dry faster than a naked northern Minnesotan in a swarm of mosquitoes. But it is Uncle Sam’s fault. He is the one who so readily gave away the clothes off their backs, so that the big boys on Wall Street could cover their financial nakedness.

Now Uncle Sam is dangerously exposed too, and the mosquitoes’ feeding frenzy is sapping the national lifeblood.

When Congress approved the first bailout money, politicians said taxpayers could reasonably expect to turn a profit out of the deal. About $9.7 trillion later, the government has committed more money than at any time by any government in history, and the Great Recession rages on. In exchange for the servitude of multiple future generations, America has experienced almost zero success. There is no way that taxpayers will profit from this mess, and politicians know it.

aig, the biggest helicopter-size mosquito of them all, is an insurance-company-turned-Wall-Street-casino that is now intravenously connected to government arteries. On March 2, aig announced the largest quarterly loss in U.S. corporate history. Its investments caused more than $61 billion to cease to exist—in just four short months. What makes this loss doubly bad is that the government owns 80 percent of aig, courtesy of the last three government bailouts.

Now Uncle Sam says it will give the company $30 billion more.

Total cost to taxpayers for this formerly aaa-rated company: an astounding $180 billion. But American International Group is just one proboscis-wielding parasite.

Mortgage giants Freddie Mac and Fannie Mae, and General Motors and Chrysler join the hive of aircraft-size financial insects that include Bank of America, Citigroup, JP Morgan Chase, Wells Fargo, State Street Corp, Bank of NY Mellon, US Bancorp, SunTrust Banks, Capital One Financial, pnc, Regions Financial, bb&t Corp, Fifth Third Bancorp, MetLife Financial, Goldman Sachs, Morgan Stanley and American Express, all of which are also living off taxpayer transfusions.

The volume of taxpayer blood involved here is staggering. The Treasury has now committed over $1.4 trillion in liquidity for the banks. If $1.4 trillion in dollar bills was stacked in 100-pound bags, there would be almost 31 million of them. Former Treasury Secretary Henry Paulson, under President Bush, began the operation with his famous $700 billion bailout. President Obama has approved an additional $750 billion. The Federal Reserve has committed hundreds of billions more.

But here is what the good government doctors are not telling you.

That first $700 billion alone, if spent today, would be enough to purchase: Bank of America, Citigroup, JP Morgan Chase, Wells Fargo, State Street Corp, Bank of NY Mellon, US Bancorp, SunTrust Banks, Capital One Financial, pnc, Regions Financial, bb&t Corp, Fifth Third Bancorp, MetLife Financial, Goldman Sachs, Morgan Stanley and American Express—twice over. Twice over.

Now President Obama says taxpayers need to provide another, even larger, $750 billion bank bailout?

Think about what that means. Virtually every major financial institution in America can be bought outright for only $350 billion.

America’s banking system is far, far sicker than anyone in Washington dares to publicly admit.

President Obama has claimed that eventually America will make money from its bailouts of these banks. But if giving money to banks is such a good investment, why didn’t the government just purchase every single major bank in the country? And why did we not think of this long ago?

Case study: The federal government has already given Citigroup $45 billion in cash. It has also pledged to guarantee $300 billion in risky investments. Now the government may give America’s formerly biggest bank, and now one of its biggest patients, even more money.

The market only values Citigroup at $5.7 billion (as of March 9).

Taxpayers could have written a check for the price of the bank, had that money stolen, and repeated the process five more times, and still owned the whole bank outright for $45 billion.

If the government was really interested in making money with taxpayer money (as it claimed), wouldn’t it have made more sense to purchase Citigroup outright for a fraction of the cost? In fact, it could have purchased virtually the whole industry for a fraction of the cost of what it has given the banks.

That would make sense—unless the government knows something the rest of us do not. Perhaps the government realizes how toxic the big bank balance sheets actually are. Perhaps it realizes they are less than worthless! For example, is the fact that Citigroup has $35 trillion in derivatives exposure backed up by only $1.2 trillion in assets part of the fear? Is that the reason the government has avoided nationalizing the bank to this point?

If you don’t think derivatives like credit default swaps and exchange rate swaps are a big gash in the credit market, don’t forget about how 86-year-old investment bank Bear Stearns was shattered in less than 24 hours last year. On April 3, then-New York Fed President Tim Geithner said:

The sudden discovery by Bear’s derivative counterparties that important financial positions they had put in place to protect themselves from financial risk were no longer operative would have triggered substantial further dislocation in markets. This would have precipitated a rush by Bear’s counterparties to liquidate the collateral they held against those positions and to attempt to replicate those positions in already very fragile markets.

According to famed investor Warren Buffet, this is Fedspeak for: “We stepped in to avoid a financial chain reaction of unpredictable magnitude.” In his February letter to shareholders of Berkshire Hathaway, Buffet went on to warn: “Derivatives are dangerous. … They have made it almost impossible for investors to understand and analyze our largest commercial banks and investment banks.”

This is Buffetspeak for: No one, including the Treasury, has any idea of how massive the losses could get.

And thanks to the government, you are now directly involved in this high-stakes game.

Maybe this is what is happening: The government would rather throw good money away now, knowing full well it will never get it back, in order to buy time and hope for a miracle, rather than paying a fraction of the amount to take control of sick banks that are legally on the hook for untold astronomical losses.

The government faces a multitrillion-dollar choice. The taxpayer has already committed so much money that it would be political suicide to let the big banks fail now. So, does the government resign itself to the fact that it will be injecting hundreds of billions of dollars in never-ending doses to hundreds of banks for the foreseeable future—a known, but inevitable, slow bleed-out? Or will the government begin massive nationalizations of America’s largest insolvent banks in an attempt to bring confidence back into the whole system—but at the risk of immediately hemorrhaging the nation?

Each option is fraught with risk.

Don’t be fooled into thinking that the taxpayer bailouts were just designed to get the banks lending money again. The situation is much more perilous. Losses continue to be revealed, and America’s banking system is all but bankrupt—kept alive only through taxpayer blood.

But how much blood can America afford to give? And will the mosquito-borne diseases that it is sure to contract be fatal?