The Top Earning Degrees

A CNN Money article today lists the most lucrative undergraduate degrees (see the graphic above) and notes that, unsurprisingly, they all require math skills. A couple of thoughts on this. First, take a look at the first and third highest-paying degrees (petroleum and mining engineering, respectively). I've argued in the past for the economic benefits of facilitating more domestic natural resources production (e.g., here and here). One of the benefits I've noted is that natural resources extraction tends to create a lot of high-paying blue collar jobs. As this CNN article notes, it also creates high-paying professional jobs, which is another benefit.

Consider the benefits to California, for example, if it dropped its opposition to expanding offshore drilling. For one thing, it might improve the state's environment by reducing natural oil seepage. It would also generate much-needed royalty revenue for the state (in fact, the state could capture that revenue up front by issuing revenue bonds backed by those future royalty income streams). In addition, how many jobs would it create for petroleum engineers and oil rig workers? Couldn't California use the additional net tax payers and potential home buyers these workers would represent?

Another thought: given that the fifteen most lucrative college majors require math aptitude, does it make sense that the SAT has reduced the relative weight of its math section in the total SAT score from one half to one third (by adding an equal-weighed essay section to the math and verbal sections)?

"Why Gasoline is Still King"

Another interesting article from the American re fossil fuels, this one by Ralph Bennett: "Why Gasoline is Still King: Electric roadsters are the darlings of the press, but it is likely that gasoline will continue to dominate personal transportation." Bennett's short answer comes down to the energy density of gasoline. Below is a relevant excerpt:

We may expatiate on the latest developments in electric cars and the delicious prospects of hydrogen fuel cells and various biofuels made with everything from switch grass to garbage; we may earnestly speculate about flywheels and compressed air and various gases, natural and unnatural—but we go with gasoline.

A gallon of gas weighs about 6.3 pounds and produces roughly 35 kilowatt hours of energy. That’s enough to burn a 100-watt light bulb continuously for more than two weeks. A lead-acid battery could do the same thing without needing a recharge—if it were the size of a desk and weighed a ton. Energy density is the point. We just haven’t come up with a fuel or a device that will safely and economically offer the same calorific value in such a small space as an automobile’s gasoline tank. Compressed natural gas (CNG) and liquefied natural gas (LNG) intrigue us, but the problems of storing them (or hydrogen) in a car in sufficient quantity to approach gasoline’s range and performance continues to be a sticking point. We always come back to density.

The photo above, from the article, is of the Tesla Roadster

Why We Will Be Using Fossil Fuels for Decades to Come

From Vaclav Smil's essay in the American, "Moore's Curse and the Great Energy Delusion":

“Energy transitions” encompass the time that elapses between an introduction of a new primary energy source oil, nuclear electricity, wind captured by large turbines) and its rise to claiming a substantial share (20 percent to 30 percent) of the overall market, or even to becoming the single largest contributor or an absolute leader (with more than 50 percent) in national or global energy supply. The term also refers to gradual diffusion of new prime movers, devices that replaced animal and human muscles by converting primary energies into mechanical power that is used to rotate massive turbogenerators producing electricity or to propel fleets of vehicles, ships, and airplanes. There is one thing all energy transitions have in common: they are prolonged affairs that take decades to accomplish, and the greater the scale of prevailing uses and conversions the longer the substitutions will take. The second part of this statement seems to be a truism but it is ignored as often as the first part: otherwise we would not have all those unrealized predicted milestones for new energy so.

[...]

The scale of transition needed for electricity generation is perhaps best illustrated by deconstructing Al Gore’s July 2008 proposal to “re-power” America: “Today I challenge our nation to commit to producing 100 percent of our electricity from renewable energy and truly clean carbon-free sources within 10 years. This goal is achievable, affordable, and transformative.”

Let’s see. In 2007 the country had about 870 gigawatts (GW) of electricity-generating capacity in fossil-fueled and nuclear stations, the two nonrenewable forms of generation that Gore wants to replace in their entirety. On average,these thermal power stations are at work about 50 percent of the time and hence they generated about 3.8 PWh (that is, 3.8 x 10¹⁵ watt-hours) of electricity in 2007. In contrast, wind turbines work on average only about 23 percent of the time, which means that even with all the requisite new high-voltage interconnections, slightly more than two units of wind-generating capacity would be needed to replace a unit in coal, gas, oil, and nuclear plants. And even if such an enormous capacity addition—in excess of 1,000 GW—could be accomplished in a single decade (since the year 2000, actual additions in all plants have averaged less than 30 GW/year!), the financial cost would be enormous: it would mean writing off the entire fossil-fuel and nuclear generation industry, an enterprise whose power plants alone have a replacement value of at least $1.5 trillion (assuming at least $1,700/installed kW), and spending at least $2.5 trillion to build the new capacity.

But because those new plants would have to be in areas that are not currently linked with high-voltage (HV)transmission lines to major consumption centers (wind from the Great Plains to the East and West coasts,photovoltaic solar from the Southwest to the rest of the country), that proposal would also require a rewiring of the country. Limited transmission capacity to move electricity eastward and westward from what is to be the new power center in the Southwest, Texas, and the Midwest is already delaying new wind projects even as wind generates less than 1 percent of all electricity. The United States has about 165,000 miles of HV lines, and at least 40,000 additional miles of new high-capacity lines would be needed to rewire the nation, at a cost of close to $100 billion. And the costs are bound to escalate, because the regulatory approval process required before beginning a new line construction can take many years. To think that the United States can install in 10 years wind and solar generating capacity equivalent to that of thermal power plants that took nearly 60 years to construct is delusional.

Two New Jersey Plutocrats Join Forces to Oppose Offshore Drilling

Apparently, record-high energy prices haven't had the same effect on Jon Corzine and Frank Lautenberg as last week's Pew Poll noted they have had on a somewhat more representative sample of Americans. NJ Governor Corzine, the former Goldman Sachs chief, and U.S. Senator Frank Lautenberg, D-NJ, one of the founders of ADP, got together with a couple of their less-affluent political colleagues in the Jersey Shore town of Belmar today to express their opposition to offshore drilling (The Record: "Corzine, others vow to fight offshore drilling").

On The Record's website, a lone commenter, "RamapoGuy" dissents from the Plutocrats' opinion on offshore drilling. After first noting that offshore rigs in the Gulf didn't spill oil even during Hurricane Katrina, he writes,

Alaskans get oil revenue checks each year..why can't we? We listened to the wackos in the 80's who said Nuclear energy would kill us all and now we are looking into Nuclear once more. If we would have ignored them back then, we would be in a better position today. We need to look at the current drilling technologies and start drilling something. We will always need oil so even if the oil is 10 years away, if we start exploring now, we will have it in 10 years. If we do nothing, we will have it never! Start drilling for oil and send a message to OPEC that we are starting to look elsewhere for oil.

Whom do you imagine has a better chance of getting his way on this, RamapoGuy or Jon Corzine and Frank Lautenberg? This is another reason to be confident in the secular bull market trend in oil continuing for another five years.