on the dressing of the qubit-field coupling by periodic modulations of the qubit energy. In the dressed basis, the radiative decay of the first qubit becomes an effective incoherent pumping mechanism that injects energy into the system, hence turning dissipation to our advantage. A second, auxiliary qubit is used to shape the decay within the cavity, in such a way that lasing occurs in a squeezed basis of the cavity mode. We characterize the system both by mean-field theory and exact calculations. Our work may find applications in the generation of squeezing and entanglement in circuit QED, as well as in the study of dissipative many-body phase transitions.