An arti­cle in last Wednesday’s NYT included a pretty remark­able sta­tis­tic. Steven R. Weis­man cited Diana Far­rell, direc­tor of the McK­in­sey Global Insti­tute, who esti­mates that petrodol­lars have held Amer­i­can inter­est rates three-​quarters of a per­cent lower than they would have been otherwise.

The macro­eco­nom­ics behind the rate supres­sion are simple—more avail­able dol­lars = more avail­able credit = lower inter­est rates—but con­sider for a moment what it means in real terms. Wednesday’s NYT quoted the 30-year fixed mort­gage rate at 5.80%, which means that a home­owner with a $300,000 mort­gage would pay $1760/month. Now let’s assume that Far­rell is right about the 0.75% sup­pres­sion. With­out the lower credit made pos­si­ble by petrodol­lars, the same home­owner would be look­ing at a 6.55% inter­est rate, which trans­lates into a $1906 monthly pay­ment. The dif­fer­ence, then, turns out to be $146 per month, or $1,752 per year. Which means that the mort­gage of our fic­tional Amer­i­can home­owner is being effec­tively sub­si­dized by oil money to the tune of 8.3% over­all. And that’s not saying any­thing about all of the other places the interest-​rate sup­pres­sion affects our lives (credit cards, car loans, etc.).

The trou­bling thing about this oil subsidy—for Amer­i­cans, anyway—is not that it’s hap­pen­ing but that it could dis­ap­pear some­day very soon.