Just when you think the headlines could not get any more absurd, the Wall Street Journal declares today that the “Bailouts Yield Returns Amid Risk.” while yesteday’s Financial Times lets us know that the Federal Reserve is turning a profit on its lending programs.

What is missing from these headlines is that while some loans and investments have provided a positive return to taxpayers, the overall programs themselves are estimated to cost the taxpayers hundreds of billions.  Overall the government has received about $30 billion in dividends, premiums for guarantees, and interest payments:  $7 billion in TARP dividends from banks, $14 billion for the Federal Reserve from purchases of mortgage-backed securities and other investments, and $9 from the FDIC’s bank debt guarantee program.

While $30 billion may sound like a substantial amount of money, it is less than a tenth of the $356 billion that the Congressional Budget Office tells us we will never see back from TARP.  And the Fed’s income from purchasing Fannie and Freddie securities will also amount to about a tenth of the ultimate losses we are likely to suffer from bailing out those entities.  In regard to the FDIC’s debt guarantee program, premiums are paid up front, making that look like income, while the guarantees will remain outstanding for several years.  Given that there is currently almost $340 billion in FDIC guaranteed bank debt outstanding, all it would take is a loss rate of 2.6% on that debt to wipe out any premiums collected so far.

Before Washington starts to spend all its newfound earnings, we should all stop and remember that these bailouts continue to leave the taxpayer in a pretty big hole.