LONDON (MarketWatch) -- To paraphrase a recent newsmaker, America's mortgage chickens are coming home to roost.

The incipient collapse of Freddie Mac FRE, -0.64% and Fannie Mae FNM, +0.85% will in all likelihood dump an additional $5 trillion in debt onto the national books by making explicit the companies' dependence on the American taxpayer as their ultimate backstop.

No glib politician, let alone Treasury Secretary Henry Paulson, will be able to talk their way out of this one.

And the world's leading sources of capital, China and the Gulf oil states aren't about to sign on to support the political priorities of Washington, D.C. politicians looking to subsidize home ownership and get themselves re-elected.

Instead, America is just going to have to work its way through this mess on its own.

It will not be a pleasant process.

Wall Street will cherry-pick the productive mortgages, and the rest will be dumped on everyone else's doorstep.

People who didn't borrow cheap money they couldn't afford and who paid their mortgages on time, will nonetheless have to pony up more taxes to cover the losses incurred by their profligate fellow citizens at the prodding of an elected class that sought to extend homeownership to every American capable of casting a vote.

Maybe, just maybe, the political class will finally have to own up to making some difficult choices: eliminating a couple of aircraft carriers for a start, and that $100 billion a year they spend on the department of education.

It might be a good idea to scrap that new air tanker contract too, given that they can't seem to get it awarded anyway.

If they had any real guts, they'd use this occasion to get rid of the mortgage interest deduction. After all, given that Congress' popularity rating is in single digits already, why not take advantage of the opportunity?

And if the Iraqis can't use their oil wealth to outsource their internal security needs with oil pushing $150 a barrel, they're never going to be able to.

A high school teacher of mine used to say it didn't matter how much money the government borrowed because it was a measure of how much faith Americans had in their future.

We're about to find out.

- Tom Bemis, assistant managing editor