When Congress voted on Dec. 23 to fund a temporary extension of the payroll-tax holiday in part by requiring Fannie Mae and Freddie Mac to increase their fees, it effectively ended the fiction that the two mortgage-financing giants are part of the private sector.

Lawmakers should now recognize budgetary reality and put the firms’ liabilities on the government balance sheet and include their spending in the federal budget. The purpose of doing so shouldn’t be to keep the firms as part of the government, however.