Business
Red state coal towns still power the West Coast. We can't just let them die
In the early morning light, it’s easy to mistake the towering gray mounds for an odd-looking mountain range — pale and dull and devoid of life, some pine trees and shrublands in the foreground with lazy blue skies extending up beyond the peaks.
But the mounds aren’t mountains.
They’re enormous piles of dirt, torn from the ground by crane-like machines called draglines to open paths to the rich coal seams beneath. And even though we’re in rural southeastern Montana, more than 800 miles from the Pacific Ocean, West Coast cities are largely to blame for the destruction of this landscape.
Workers at the Rosebud mine load coal onto a conveyor belt, which carries the planet-wrecking fuel to a power plant in the small town next door. Plant operators in Colstrip burn the coal to produce electricity, much of which is shipped by power line to homes and businesses in the Portland and Seattle areas. It’s been that way for decades.
“The West Coast markets are what created this,” Anne Hedges says, as we watch a dragline move dirt.
An aerial view of the coal mine outside Colstrip that feeds the town’s power plant.
(Robert Gauthier / Los Angeles Times)
She sounds frustrated, and with good reason.
Hedges and her fellow Montana environmentalists were happy when Oregon and Washington passed laws requiring 100% clean energy in the next two decades. But they’re furious that electric utilities in those states are planning to stick with coal for as long as the laws allow, and in some cases making deals to give away their Colstrip shares to co-owners who seem determined to keep the plant running long into the future.
“Coal is not dead yet,” Hedges says. “It’s still alive and well.”
That’s an uncomfortable reality for West Coasters critical of red-state environmental policies but not in the habit of urging their politicians to work across state lines to change them — especially when doing so might involve compromise with Republicans.
One example: California lawmakers have refused to pass bills that would make it easier to share clean electricity across the West, passing up the chance to spur renewable energy development in windy red states such as Montana and Wyoming — and to show them it’s possible to create construction jobs and tax revenues with renewable energy, not just fossil fuels.
Instead, California has prioritized in-state wind and solar farms, bowing to the will of labor unions that want those jobs.
It’s hard to blame Golden State politicians, and voters, for taking the easy path.
But global warming is a global problem — and whether we like it or not, the electric grid is a giant, interconnected machine. Coal plants in conservative states help fuel the ever-deadlier heat waves, fires and storms battering California and other progressive bastions. The electrons generated by those plants flow into a network of wires that keep the lights on across the American West.
Also important: Montana and other sparsely populated conservative states control two U.S. Senate seats each, and at least three electoral votes apiece in presidential elections. Additional federal support for clean energy rests partly in their hands.
Those are the practical considerations. Then there are the ethical ones.
For years, the West’s biggest cities exported their emissions, building distant coal generators to fuel their explosive growth. Los Angeles looked to Delta, Utah. Phoenix turned to the Navajo Nation. Albuquerque turned to the Four Corners region.
That wave of coal plants — some still standing, some demolished — created well-paying jobs, lots of tax payments and a thriving way of life for rural towns and Native American tribes. All are now struggling to map out a future without fossil fuels.
Mule deer roam through the town of Colstrip, not far from the power plant.
(Robert Gauthier / Los Angeles Times)
What do big cities owe those towns and tribes for producing our power and living with our air and water pollution? Can we get climate change under control without putting them out of business? What’s their role in the clean energy transition?
If they refuse to join the transition, how should we respond?
A team of Los Angeles Times journalists spent a week in Montana trying to answer those questions.
We explored the town of Colstrip, hearing from residents about how the coal plant and mine have made their prosperous lives possible. We talked with environmental activists who detailed the damage coal has caused, and with a fourth-generation rancher whose father fought in vain to stop the power plant from getting built — and wrote poems about his struggle.
Coal is going to die, sooner or later. For the sake of myself and other young people, I hope it’s sooner.
And for the sake of places like Colstrip, I hope it’s the beginning of a new chapter, not the end of the story.
Coal pays the bills. For now
For a community of 2,000 people, Colstrip doesn’t lack for nice things.
The city is home to 32 public parks and a gorgeous community center, complete with child care, gym, spin classes, tanning booth and water slide. The spacious health clinic employs three nurses and two physical therapists, with a doctor coming to visit once a week. There’s an artificial lake filled with Yellowstone River water and circled by a three-mile walking and biking trail.
Everybody knows where the good fortune comes from.
The high school pays homage to the source of Colstrip’s wealth with the hashtag #MTCOAL emblazoned on the basketball court’s sparkling floor. A sign over the entrance to campus celebrates the town’s 2023 centennial: “100 Years of Colstrip. Powered by Coal, Strengthened by People.”
“We have nothing to hide,” Jim Atchison tells me. “We just hope that you give us a fair shake.”
Jim Atchison steps out of his office in Colstrip.
(Robert Gauthier / Los Angeles Times)
I couldn’t have asked for a better tour guide than Atchison, who for 22 years has lived in Colstrip and led the Southeast Montana Economic Development Corp. He’s soft-spoken and meticulous, with a detailed itinerary for our day and a less ironclad allegiance to coal than many of the locals we’ll meet.
They include Bill Neumiller, a former environmental engineer at the power plant. We start our day with him, watching the sun rise over the smokestacks across the lake. He moved to Colstrip 40 years ago, when the coal plant was being built. He enjoys fishing in the well-stocked lake and teaching kids about its history, in his role as president of the parks district.
The plant, he says, pays the vast majority of the city’s property taxes.
“It’s been a great place to raise a family,” he says.
So many people have similar stories — the general manager of a local electrical contractor, the administrator of the health clinic. I especially enjoy chatting with Amber and Gary Ramsey, who have run a Subway sandwich shop here for 30 years.
“It takes us two to three hours to get through the grocery store, because you know everybody,” Gary says.
He didn’t plan to spend his life here. Sitting at a table at Subway, he tells us he grew up in South Dakota and went to college in North Dakota before taking a job teaching math and coaching wrestling in Colstrip. He planned to stay for a year or two.
Then he met Amber, who was working part time as a bartender and doing payroll at the coal plant.
“Forty years later, I’m still here,” he says. “We raised our kids here.”
The power plant’s smokestacks are visible from miles away in the town of Colstrip.
(Robert Gauthier / Los Angeles Times)
John Williams was one of the first Montana Power Co. employees to move to Colstrip, as planning for the plant’s construction got started. Today he’s the mayor. He’s well-versed in local history, from the first coal mining in the 1920s — which supplied railroads that later switched to diesel — to the economic revitalization when the Portland and Seattle areas came calling.
Unlike many of the other Colstrip lifers who share their stories, several of Williams’ kids have left town. But one of his sons lives in a part of Washington where some of the electricity comes from Colstrip. Same for another son who lives in Idaho.
It’s hard for Williams to imagine a viable future for his home without the power plant.
“I believe they are intimately tied together,” he says.
And what about climate change, I ask?
Nearly everyone in Colstrip has a version of the same answer: Even if it’s real, it’s not nearly as bad as liberals claim. And without coal power, blackouts will reign. West Coast city dwellers don’t understand how badly they need us here in Montana.
Atchison is an exception.
Yes, he’s dubious about climate science. And yes, he wants to save the mine and power plant. His office is plastered with pro-coal messages — a sign that says, “Coal Pays the Bills,” a magnet reading, “Prove you’re against coal mining: Turn off your electricity.”
But he knows the market for coal is shrinking as the nation’s most populous cities and most profitable companies increasingly demand climate-friendly energy. So he’s preparing for a future in which Colstrip has no choice but to start providing it.
“We have one horse in the barn now,” Atchison says. “We need to add two or three more horses to the barn.”
A conveyor belts carries coal from the Rosebud Mine to the Colstrip power plant.
(Robert Gauthier / Los Angeles Times)
Ever since President Obama started trying to tighten regulations on coal power, Atchison has been developing and implementing an economic diversification strategy for Colstrip. It involves expanding broadband capacity, building a business innovation center and broadening the local energy economy beyond coal. The transmission lines connecting Colstrip with the Pacific Northwest are an especially valuable asset, capable of sending huge amounts of clean electricity to the Pacific coast.
“Colstrip is evolving from a coal community into an energy community,” Atchison says. “We’re changing. We’re not closing.”
Already, Montana’s biggest wind farm is shipping electricity west via the Colstrip lines. A Houston company is planning another power line that would run from Colstrip to North Dakota. Federal researchers are studying whether Colstrip’s coal units could be replaced with advanced nuclear reactors, or with a gas-fired power plant capable of capturing and storing its climate pollution.
West Coast voters and politicians could speed up the evolution, for Colstrip and other coal towns. Instead of just congratulating themselves for getting out of coal, they could fund training programs and invest in clean energy projects in those towns.
They’ll never fully replace the ample jobs, salaries and tax revenues currently provided by coal. But nothing lasts forever. One hundred years is a pretty good run.
Some inconvenient truths
“Great God, how we’re doin’! We’re rolling in dough,
As they tear and they ravage The Earth.
And nobody knows…or nobody cares…
About things of intrinsic worth.”
—Wally McRae, “Things of Intrinsic Worth” (1989)
Growing up outside Colstrip in the 1970s could lead to strange moments for Clint McRae, the son of a cowboy poet.
He was a teenager then, and Montana Power Co. was working to build public support for Units 3 and 4 of the coal plant. One day his eighth-grade teacher instructed everyone who supported the new coal-fired generators to stand on one side of the classroom. Everyone opposed should stand on the other side.
McRae was the only student opposed.
“And then [the teacher] gave a lecture about how important the construction of these plants was and handed out bumper stickers that said, ‘Support Colstrip Units 3 and 4,’” McRae tells me, shaking his head. “It was terribly uncomfortable.”
Rancher Clint McRae was raised outside Colstrip and has followed in his father’s footsteps.
(Robert Gauthier / Los Angeles Times)
Later, his mom was doing laundry and found a pro-coal bumper sticker in his pants pocket. She showed it to his cattle rancher father, Wally, “and I guess he went over there [to the school] and kicked ass and took names,” McRae says with a laugh.
Fifty years later, he’s carrying on his dad’s legacy.
We spend a morning in the Colstrip area on McRae’s sprawling ranch, admiring sandstone rock formations and herds of black Angus cows. The scenery is harsh but elegant, rolling hills and pale green grasses and pink-streaked horizon lines.
“This country has a sharp edge to it,” McRae says, quoting a photographer who visited the property years ago.
The land has been in his family since the 1880s, when his great-grandfather emigrated from Scotland. He hopes his youngest daughter — who recently moved back home with her husband — will be the fifth generation to raise cattle here.
“And we just had a grandchild seven months ago, and she’s the sixth,” he says.
Rancher Clint McRae contemplates the environmental threats facing his family’s land.
(Robert Gauthier / Los Angeles Times)
McRae wears a cowboy hat and drives a pickup truck. He tells me right away that he’s “not the kind of person who participates in government programs unless I absolutely have to.” He’s certainly got no qualms about making a living selling beef.
But McRae and his forebears defy stereotypes.
His father, Wally, not only raised cows but was also a celebrated poet, appointed by President Clinton to the National Council on the Arts. In the 1970s, he joined with other ranchers to help found Northern Plains Resource Council, an advocacy group. They were moved to act by a utility industry plan for nearly two dozen coal plants between Colstrip and Gillette, Wyo.
“I and others like me will not allow our land to be destroyed merely because it is convenient for the coal company to tear it up,” Wally McRae said, as quoted in a 50th-anniversary book published by Northern Plains.
Now in his late 80s and retired from the ranch, Wally’s got every reason to be proud of his son.
Clint has fought to limit pollution from the coal plant his dad couldn’t stop — and to ensure the cleanup of dangerous chemicals already emitted by the plant and mine. He’s written articles calling for stronger regulation of coal waste, and slamming laws that critics say would let coal companies pollute water with impunity. Like his father, he’s a member of Northern Plains.
McRae wants me to know that even though he and his dad “damn sure have a difference of opinion” with many of the people who live in town, “it was never personal.” The coal plant employees are friends of his. He doesn’t want them to lose their jobs.
“Our kids went to school together, played sports together,” he says.
Rancher Clint McRae opens a gate on his family’s land outside Colstrip.
(Robert Gauthier / Los Angeles Times)
But even though McRae believes “we can have it both ways” — coal generation coupled with environmental protection — he’s not optimistic. And history suggests he’s right to be skeptical. Various analyses have found rampant groundwater contamination from coal plants, including Colstrip. Air pollution is another deadly concern. A peer-reviewed study last year estimated that fine-particle emissions from coal plants killed 460,000 Americans between 1999 and 2020.
Then there’s the climate crisis.
McRae doesn’t want to talk about global warming — “that’s not my bag,” he says. But he’s seen firsthand what it can look like.
In August 2021, the Richard Spring fire tore across 171,000 acres, devastating much of his ranch and nearly torching both of his family’s houses. He was on the front lines of the fast-moving blaze as part of the local volunteer firefighting crew. Temperatures topped 100 degrees, adding to the strain of dry conditions and fierce winds. McRae had never seen anything like it.
Two and a half years later, he’s still building back up his cattle numbers and letting the grass regrow.
“It burned all of our hay. It was awful,” he says.
McRae has a strong sense of history. As we drive toward the Tongue River, which forms a boundary of his ranch, he points out where members of the Arapaho, Lakota Sioux and Northern Cheyenne tribes camped before the Battle of the Little Bighorn in 1876, a few years ahead of his great-grandfather’s arrival in Montana. A few minutes later he stops to show off a series of tipi rings — artifacts of Indigenous life that he’s promised local tribes he’ll protect.
McRae is acutely aware that this wasn’t always ranchland — and that it probably won’t be forever.
“It’s gonna change,” he says. “Whether we embrace it or not.”
The wind and the water
Sturgeon. Bubbles. Salamander. Jimmy Neutron.
Those are “call signs” for some of the 13 employees at the Clearwater wind farm, where 131 turbines are spread across 94 square miles of Montana ranchland a few hours north of Colstrip. The nicknames are scrawled on a whiteboard in the trailer office.
Raptor. Goose. Sandman.
Clearly, they have fun here. And it’s an industry where you can make good money.
Turbines spin at sundown at NextEra Energy’s Clearwater wind farm, which sends power from Montana to Oregon and Washington.
(Robert Gauthier / Los Angeles Times)
Clearwater’s operator, Florida-based NextEra Energy, won’t disclose a salary range. But as of 2022, the median annual wage for a U.S. wind turbine technician working in electric power was $59,890, compared with $46,310 for all occupations nationally.
“If someone wants to stay close to home and still have a good career, we provide them that opportunity,” Alex Vineyard says.
Vineyard lives in nearby Miles City and manages Clearwater for NextEra, America’s largest renewable energy company. Clad in a hard hat, sweater vest and orange work gloves, he drives to a nearby turbine and walks up a staircase to show us the machinery inside. The tower is 374 feet high, meaning the tips of the blades reach 582 feet into the air.
Not far from here, hundreds of construction laborers are finishing the next two phases of the Clearwater project.
Alex Vineyard manages the Clearwater wind farm for NextEra, America’s largest renewable energy company.
(Robert Gauthier / Los Angeles Times)
“You can see where we build wind sites. It’s not downtown L.A.,” Vineyard says, the sunset casting a brilliant orange glow behind him. “Generally it’s rural areas — and there are limited opportunities for kids in those areas. Not a lot of great careers.”
Wind will never replace coal. The construction jobs are temporary, the permanent jobs far fewer.
But they’re better than nothing. A lot better.
As much as West Coast megacities owe it to coal towns like Colstrip to bring them along for the clean energy ride, coal towns like Colstrip owe it to themselves to take what they can get — and not let stubbornness or politics condemn them to oblivion.
Fortunately, they’ve got the power grid on their side.
In today’s highly regulated, thoroughly litigated world, long-distance power lines are incredibly hard to build. They can take years if not decades to secure all the necessary approvals — if they can get those approvals at all. As a result, wind and solar developers prize existing transmission lines, like those built to carry power from Colstrip and other coal plants to big cities.
The Clearwater wind farm offers a telling case study.
Two of Colstrip’s four coal units shut down in 2020 due to poor economics, opening up precious space on the plant’s power lines. That open space made it easier for NextEra to sign contracts to sell hundreds of megawatts of wind power to two of Colstrip’s co-owners, Portland General Electric and Puget Sound Energy — and thus get Clearwater built.
An electrical substation flanks the Colstrip power plant.
(Robert Gauthier / Los Angeles Times)
Montana wind is especially useful for Oregon and Washington because it blows strongest during winter, when those states need lots of energy to stay warm. On that front, Clearwater has been a huge success. During its first winter, it had a capacity factor of 60%, meaning it produced 60% of all the power it could possibly produce, if there were enough wind 24/7.
Sixty percent is a lot — “like a home run,” Puget Sound Energy executive Ron Roberts says.
He and his colleagues want more. Puget Sound plans to build more Montana wind turbines to serve its Washington customers — again taking advantage of the Colstrip power lines.
West Coast states need to keep investing in exactly this type of project if they hope to persuade their conservative neighbors to stop fighting to save coal. The more they can bring the benefits of wind and solar power to the rest of the West, the better.
And what about those low-wind, cloudy days when wind turbines and solar panels aren’t enough to avoid blackouts?
Carl Borgquist has a plan for that.
I meet up with him near Gordon Butte — a flat-topped landmass that juts up 1,025 feet from the floor of Montana’s Musselshell River valley, four hours west of Colstrip but just over five miles from the coal plant’s power lines. There are already wind turbines atop the butte, built by the landowning Galt family with Borgquist’s help.
Borgquist assures me as we drive to the top that I’ll soon understand why this steep butte is perfect for energy storage.
“It will intuitively make sense, the elegance and simplicity of gravity as a storage medium,” he says.
Carl Borgquist admires the views from atop Gordon Butte, where he’s got plans for a pumped storage project to augment Montana wind power.
(Robert Gauthier / Los Angeles Times)
There will be two reservoirs — one up on the butte, another 1,000 feet below. They’ll be filled with water from a nearby creek.
During times of day when there’s extra power on the Western electric grid — maybe temperatures are moderate in Portland and Seattle, but Montana winds are blowing strong — the Gordon Butte project will use that extra juice to pump water uphill, from the lower reservoir to the upper reservoir. During times of day when the grid needs more power — maybe there’s a record heat wave, and not enough wind to go around — Gordon Butte will let water flow downhill, generating electricity.
It’s called pumped storage, and it’s not a new concept. But compared with other proposals across the parched West, this one is almost miraculously noncontroversial. No environmentalists making hay over water use. No nearby residents crying foul.
Borgquist still needs to sign up a utility customer, or he would have already flipped Gordon Butte to a developer better suited to build the $1.5-billion project, which will employ 300 to 500 people during construction. But Borgquist is confident that before too long, one or two of the Pacific Northwest electric utilities preparing to ditch Colstrip will see the light.
“I’ve been waiting for the market to catch up to me,” he says.
Let’s hope it catches up soon. Because even though pumped storage won’t keep us heated and cooled and well-lit every hour of every day, neither will wind, or solar, or batteries, or anything else. No one technology will solve all our climate problems.
The sooner we learn that lesson, the sooner we can move on to the hard part.
The Colstrip power lines run near Gordon Butte, carrying coal-fired electricity — and increasingly wind energy — from Montana to Oregon and Washington.
(Robert Gauthier / Los Angeles Times)
The art of the deal
I find myself wandering the halls of the state Capitol in Helena. Christmas is a few weeks away, and there’s a spectacular tree beneath the massive dome, flanked by murals of white settlers and Indigenous Americans.
On a whim, I step into Gov. Greg Gianforte’s office and ask if he’s in. Gianforte has fought to keep the Colstrip plant open, and I want to ask him about it. I’m also curious to meet a man who easily won election despite having assaulted a journalist.
One of his representatives takes down my contact info. I never get an interview.
Despite the state’s deep-red turn in recent years, Montanans have a history of environmental consciousness, owing to their love of fishing, hunting and the great outdoors (as seen in the film “A River Runs Through It”). They approved a new state constitution in 1972 that enshrined the right to a “clean and healthful environment in Montana for present and future generations.”
To the frustration of Gianforte and his supporters, that right may include a stable climate.
This time last year, a Montana judge revoked the permit for a gas-fired power plant being built by the state’s largest electric utility, NorthWestern Energy, along the banks of the Yellowstone River. The judge ruled that the state agency charged with approving the gas plant had failed to consider how the facility’s heat-trapping carbon emissions would contribute to the climate crisis.
NorthWestern Energy says this gas-fired power plant on the Yellowstone River is needed to help keep the lights on for homes and businesses.
(Robert Gauthier / Los Angeles Times)
Legislators responded by rushing to pass a law that barred state agencies from considering climate impacts.
The Yellowstone River gas plant moved forward, but the law didn’t last long. A few months after it passed, another judge ruled in favor of 16 young people suing the state over global warming, agreeing that the legislation violated their constitutional right to a clean and healthful environment.
“This is such a solvable problem,” says Hedges, the Montana environmentalist critical of coal mining. “It’s just that nobody wants to solve it.”
Hedges is a leader of the Montana Environmental Information Center, where she’s spent three decades battling for clean air, clean water and a healthy climate. It was her advocacy group, along with the Sierra Club, that sued Montana over the state’s approval of the Yellowstone River gas plant, setting off the chain of increasingly consequential court rulings.
But as mad as she is at Gianforte — and at the local utility company executives who insist they need coal to keep the lights on in Montana — Hedges is at her most caustic when discussing the Pacific Northwest environmentalists who, in her view, have failed to do everything they can to get the Colstrip power plant shut down.
That includes the Sierra Club, which, Hedges says, has shifted its focus too quickly from shutting down coal plants to blocking the construction of new gas plants — even in places such as Montana, where coal, the dirtiest fossil fuel, isn’t dead yet.
Hedges’ frustration also includes the Washington state lawmakers who passed a much-lauded bill, signed by Gov. Jay Inslee, requiring electric utilities to stop buying coal power by 2025 — only to sit idly by as some of those utilities then made arrangements to give away their shares in the Colstrip plant to coal-friendly co-owners rather than negotiate agreements to shut the coal units.
“So they’re not actually decreasing carbon dioxide emissions even a little tiny bit. They are allowing this plant to continue, instead of using their vote to close this source of pollution. It’s maddening,” Hedges says.
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1. A lone tumbleweed blows through piles of coal at the Rosebud Mine outside Colstrip, a few miles from the power plant. 2. Coal is prepped for transport at the mine. 3. Coal is transferred to a truck at the mine. (Robert Gauthier / Los Angeles Times)
Washington officials say they tried to get Colstrip shut down but were stymied by the plant’s complicated six-company ownership structure, and by the Montana Legislature’s staunch support for coal. Sierra Club activists, meanwhile, say they’re still pushing for Colstrip’s closure, and for coal shutdowns across the country — even as they also oppose the construction of gas plants.
“From a climate perspective, gas is just as bad as coal,” says Laurie Williams, director of the Sierra Club’s Beyond Coal campaign.
To avoid a future of ever-more-dangerous fires, floods and heat, we need to ditch both fossil fuels — fast.
This is the hard part. This is the part that will require compromise — for conservatives who believe anything smacking of climate change is “woke” liberal propaganda, and for liberals who want nothing to do with conservatives spouting that belief.
So how do we do it? How do we stop clashing and start cooperating?
First off, West Coasters need to engage in good faith with the people who have supplied their power for decades — and strike deals that might persuade those red-staters to move on from coal. Deals like building more wind farms in Montana and not as many back home, even if that means fewer union jobs and lower tax revenues for California, Oregon and Washington.
It’s great that the coastal states are targeting 100% clean energy, but it’s not enough. They must bring the rest of the West along for the ride, or it won’t matter. Every solar farm in California is undermined by every ton of coal burned at Colstrip.
The lesson for folks who live in Colstrip and other Western coal towns might be even more difficult to swallow.
L.A. and Phoenix and Portland have funded your comfortable lifestyles a long time. Now they want something different.
If Colstrip wants to stick around, it needs to start offering something different.
Climate activist Anne Hedges stands in a public park near the Colstrip power plant.
(Robert Gauthier / Los Angeles Times)
It’s easy to see why that’s a scary prospect. After we finish exploring the coal mine with Hedges, we drive into town and stop at one of the immaculately maintained public parks. The power plant’s two active smokestacks aren’t far, looming 692 feet over a swing set and red-and-blue bench with the letters “USA” carved into the backing.
“The climate doesn’t care who owns the power plant,” Hedges says, as steam and carbon and soot spew from the stacks.
The climate won’t care any more when Houston-based Talen Energy — which operates the plant, and which didn’t respond to requests for a tour or interview — becomes the facility’s largest owner next year, acquiring Puget Sound Energy’s shares.
Our ability to solve this problem doesn’t depend on which company is profiting off all that coal.
What it does depend on is our willingness to make hard choices, ranchers and miners and activists setting aside their differences and writing the West’s next chapter together, rather than fighting so long and so hard that the tale ends badly for everyone.
Change is scary. But it’s inevitable. Cowboy poet Wally McRae learned that the hard way.
Maybe 50 years from now, his great-grandchildren will wax poetic about the beauty of Colstrip without coal.
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The early-morning sky glows red over the town of Colstrip.
(Robert Gauthier / Los Angeles Times)
Buffeted by upheavals in the tech and entertainment industries, California led the nation in job cuts last year — but the pace of layoffs slowed sharply in December both in the state and nationwide as company hiring plans picked up.
State employers announced just 2,739 layoffs in December, well down from the 14,288 they said they would cut in November.
Still, with the exception of Washington, D.C., California led all states in 2025 with 175,761 job losses, according to a report from outplacement firm Challenger, Gray & Christmas.
The slowdown in December losses was experienced nationwide, where U.S.-based employers announced 35,553 job cuts for the month. That was down 50% from the 71,321 job cuts announced in November and down 8% from the 38,792 job cuts reported the same month last year.
That amounted to good news in a year that saw the nation’s economy suffer through 1.2 million layoffs — the most since the economic destruction caused by the pandemic, which led to 2.3 million job losses in 2020, according to the report.
“The year closed with the fewest announced layoff plans all year. While December is typically slow, this coupled with higher hiring plans, is a positive sign after a year of high job cutting plans,” Andy Challenger, a workplace expert at the firm, said in a statement.
The California economy was lashed all year by tumult in Hollywood, which has been hit by a slowdown in filming as well as media and entertainment industry consolidation.
Meanwhile, the advent of artificial intelligence boosted capital spending in Silicon Valley at the expense of jobs, though Challenger said the losses were also the result of “overhiring over the last decade.”
Workers were laid off by the thousands at Intel, Salesforce, Meta, Paramount, Walt Disney Co. and elsewhere. Apple even announced its own rare round of cuts.
The 75,506 job losses in technology California experienced last year dwarfed every other industry, according to Challenger’s data. It attributed 10,908 of the cuts to AI.
Entertainment, leisure and media combined saw 17,343 announced layoffs.
The losses pushed the state’s unemployment rate up a tenth of a point to 5.6% in September, the highest in the nation aside from Washington, D.C., according to the U.S. Bureau of Labor Statistics data released in December.
September also marked the fourth straight month the state lost jobs, though they only amounted to 4,500 in September, according to the bureau data.
Nationally, Washington, D.C., took the biggest jobs hits last year due to Elon Musk’s initiative to purge the federal workforce. The district’s 303,778 announced job losses dwarfed those of California, though there none reported for December.
The government sector led all industries last year with job losses of 308,167 nationwide, while technology led in private sector job cuts with 154,445. Other sector with losses approaching 100,000 were warehousing and retail.
Despite the attention focused on President Trump’s tariffs regime, they were only cited nationally for 7,908 job cuts last year, with none announced in December.
New York experienced 109,030 announced losses, the second most of any state. Georgia was third at 80,893.
These latest figures follow a report from the Labor Department this week that businesses and government agencies posted 7.1 million open jobs at the end of November, down from 7.4 million in October. Layoffs also dropped indicating the economy is experiencing a “low-hire, low-fire” job market.
At the same time, the U.S. economy grew at an 4.3% annual rate in the third quarter, surprising economists with the fastest expansion in two years, as consumer and government spending, as well as exports, grew. However, the government shutdown, which halted data collection, may have distorted the results.
Still, December’s announced hiring plans also were positive. Last month, employers nationwide said they would hire 10,496 employees, the highest total for the month since 2022 when they announced plans to hire 51,693 workers, Challenger said.
The December plans contrasted sharply with the 12-month figure. Last year, U.S. employers announced they would hire 507,647 workers, down 34% from 2024.
The Associated Press contributed to this report.
That shrill, high-pitched squeal you’ve been hearing lately? Don’t bother trying to adjust your TV or headphones, or calling your doctor for a tinnitis check. It’s just America’s beleaguered billionaires keening over a proposal in California to impose a one-time wealth tax of up to 5% on fortunes of more than $1 billion.
The billionaires lobby has been hitting social media in force to decry the proposed voter initiative, which has only started down the path toward an appearance on November’s state ballot. Supporters say it could raise $100 billion over five years, to be spent mostly on public education, food assistance and California’s medicaid program, which face severe cutbacks thanks to federal budget-cutting.
As my colleagues Seema Mehta and Caroline Petrow-Cohen report, the measure has the potential to become a political flash point.
The rich will scream The pundits and editorial-board writers will warn of dire consequences…a stock market crash, a depression, unemployment, and so on. Notice that the people making such objections would have something personal to lose.
— Donald Trump advocating a wealth tax, in 2000
Its well-heeled critics include Jessie Powell, co-founder of the Bay Area-based crypto exchange platform Kraken, who warned on X that billionaires would flee the state, taking with them “all of their spending, hobbies, philanthropy and jobs.”
Venture investor Chamath Palihapitiya claimed on X that “$500 billion in wealth has already fled the state” but didn’t name names. San Francisco venture investor Ron Conway has seeded the opposition coffers with a $100,000 contribution. And billionaire Peter Thiel disclosed on Dec. 31 that he has opened a new office in Miami, in a state that not only has no wealth tax but no income tax.
Already Gov. Gavin Newsom, a likely candidate for the Democratic nomination for president, has warned against the tax, arguing that it’s impractical for one state to go it alone when the wealthy can pick up and move to any other state to evade it.
On the other hand. Rep. Ro Khanna (D-Fremont), usually an ally of Silicon Valley entrepreneurs, supports the measure: “It’s a matter of values,” he posted on X. “We believe billionaires can pay a modest wealth tax so working-class Californians have Medicaid.”
Not every billionaire has decried the wealth tax idea. Jensen Huang, the CEO of the soaring AI chip company Nvidia — and whose estimated net worth is more than $160 billion — expressed indifference about the California proposal during an interview with Bloomberg on Tuesday.
“We chose to live in Silicon Valley and whatever taxes, I guess, they would like to apply, so be it,” he said. “I’m perfectly fine with it. It never crossed my mind once.”
And in 2000, another plutocrat well known to Americans proposed a one-time tax of 14.25% on taxpayers with a net worth of $10 million or more. That was Donald Trump, in a book-length campaign manifesto titled “The America We Deserve.”
“The rich will scream,” Trump predicted. “The pundits and editorial-board writers will warn of dire consequences … a stock market crash, a depression, unemployment, and so on. Notice that the people making such objections would have something personal to lose.” (Thanks due to Tim Noah of the New Republic for unearthing this gem.)
Trump’s book appeared while he was contemplating his first presidential campaign, in which he presented himself as a defender of the ordinary American. His ghostwriter, Dave Shiflett, later confessed that he regarded the book as “my first published work of fiction.”
All that said, let’s take a closer look at the proposed initiative and its backers’ motivation. It’s gaining nationwide attention because California has more billionaires than any other state.
The California measure’s principal sponsor, the Service Employees International Union, and its allies will have to gather nearly 875,000 signatures of registered voters by June 24 to reach the ballot. The opposition is gearing up behind the catchphrase “Stop the Squeeze” — an odd choice for a rallying cry, since it’s hard to imagine the average voter getting all het up about multibillionaires getting squoze.
The measure would exempt directly held real estate, pensions and retirement accounts from the calculation of net worth. The tax can be paid over five years (with a fee charged for deferrals). It applies to billionaires residing in California as of Jan. 1, 2026; their net worth would be assessed as of Dec. 31 this year. The measure’s drafters estimate that about 200 of the wealthiest California households would be subject to the tax.
The initiative is explicitly designed to claw back some of the tax breaks that billionaires received from the recent budget bill passed by the Republican-dominated Congress and signed on July 4 by President Trump. The so-called One Big Beautiful Bill Act will funnel as much as $1 trillion in tax benefits to the wealthy over the next decade, while blowing a hole in state and local budgets for healthcare and other needs.
California will lose about $19 billion a year for Medi-Cal alone. According to the measure’s drafters, that could mean the loss of Medi-Cal coverage for as many as 1.6 million Californians. Even those who retain their eligibility will have to pay more out of pocket due to provisions in the budget bill.
The measure’s critics observe that wealth taxes have had something of a checkered history worldwide, although they often paint a more dire picture than the record reflects. Twelve European countries imposed broad-based wealth taxes as recently as 1995, but these have been repealed by eight of them.
According to the Tax Foundation Europe, that leaves wealth taxes in effect only in Colombia, Norway, Spain and Switzerland. But that’s not exactly correct. Wealth taxes still exist in France and Italy, where they’re applied there to real estate as property taxes, and in Belgium, where they’re levied on securities accounts valued at more than 1 million euros, or about $1.16 million.
Switzerland’s wealth tax is by far the oldest, having been enacted in 1840. It’s levied annually by individual cantons on all residents, at rates reaching up to about 1% of net worth, after deductions and exclusions for certain categories of assets.
The European countries that repealed their wealth taxes did so for varied reasons. Most were responding at least partially to special pleading by the wealthy, who threatened to relocate to friendlier jurisdictions in a continent-wide low-tax contest.
That’s the principal threat raised by opponents of the California proposal. But there are grounds to question whether the effect would be so stark. For one thing, notes UC Berkeley economist Gabriel Zucman, an advocate of wealth taxes generally, “it has become impossible to avoid the tax by leaving the state.” Billionaires who hadn’t already established residency elsewhere by Jan. 1 this year have missed a crucial deadline.
The initiative’s drafters question the assumption that millionaires invariably move from high- to low-tax jurisdictions, citing several studies, including one from 2016 based on IRS statistics showing that elites are generally unwilling to move to exploit tax advantages across state lines.
As for the argument that billionaires could avoid the tax by moving assets out of the state, “the location of the assets doesn’t matter,” Zucman told me by email. “Taxpayers would be liable for the tax on their worldwide assets.”
One issue raised by the burgeoning controversy over the California proposal is how to extract a fair share of public revenue from plutocrats, whose wealth has surged higher while their effective tax rates have declined to historically low levels.
There can be no doubt that in tax terms, America’s wealthiest families make out like bandits. The total effective tax rate of the 400 richest U.S. households, according to an analysis by Zucman, his UC Berkeley colleague Emmanuel Saez, and their co-authors, “averaged 24% in 2018-2020 compared with 30% for the full population and 45% for top labor income earners.” This is largely due to the preferences granted by the federal capital gains tax, which is levied only when a taxable asset is sold and even then at a lower rate than the rate on wage income.
The late tax expert at USC, Ed Kleinbard, used to describe the capital gains tax as our only voluntary tax, since wealthy families can avoid selling their stocks and bonds indefinitely but can borrow against them, tax-free, for funds to live on; if they die before selling, the imputed value of their holdings is “stepped up” to their value at their passing, extinguishing forever what could be decades of embedded tax liabilities. (The practice has been labeled “buy, borrow, die.”)
Californians have recently voted to redress the increasing inequality of our tax system. Voters approved what was dubbed a “millionaires tax” in 2012, imposing a surcharge of 1% to 3% on incomes over $263,000 (for joint filers, $526,000). In 2016, voters extended the surcharge to 2030 from the original phase-out date of 2016. That measure passed overwhelmingly, by a 2-to-1 majority, easily surpassing that of the original initiative.
But it may be that California’s ability to tax billionaires’ income has been pretty much tapped out. Some have argued that one way to obtain more revenue from wealthy households is to eliminate any preferential rate on capital gains and other investment income, but that’s not an option for California, since the state doesn’t offer a preferential tax rate on that income, unlike the federal government and many other states. The unearned income is taxed at the same rate as wages.
One virtue of the California proposal is that, even if it fails to get enacted or even to reach the ballot, it may trigger more discussion of options for taxing plutocratic fortunes. One suggestion came from hedge fund operator Bill Ackman, who reviled the California proposal on X as “an expropriation of private property” (though he’s not a California resident himself), but acknowledged that “one shouldn’t be able to live and spend like a billionaire and pay no tax.”
Ackman’s idea is to make loans backed by stock holdings taxable, “as if you sold the same dollar amount of stock as the loan amount.” That would eliminate the free ride that investors can enjoy by borrowing against their holdings.
The debate over the California wealth tax may well hinge on delving into plutocrat psychology. Will they just pay the bill, as Huang implies would be his choice? Or relocate from California out of pique?
California is still a magnet for the ambitious entrepreneur, and the drafters of the initiative have tried to preserve its allure. Those who come into the state after Jan. 1 to pursue their ambitious dreams of entrepreneurship would be exempt, as would residents whose billion-dollar fortunes came after that date. There may be better ways for California to capture more revenue from the state’s population of multibillionaires, but a one-time limited tax seems, at this moment, to be as good as any.
Google and Character.AI, a California startup, have agreed to settle several lawsuits that allege artificial intelligence-powered chatbots harmed the mental health of teenagers.
Court documents filed this week show that the companies are finalizing settlements in lawsuits in which families accused them of not putting in enough safeguards before publicly releasing AI chatbots. Families in multiple states including Colorado, Florida, Texas and New York sued the companies.
Character.AI declined to comment on the settlements. Google didn’t immediately respond to a request for comment.
The settlements are the latest development in what has become a big issue for major tech companies as they release AI-powered products.
Suicide prevention and crisis counseling resources
If you or someone you know is struggling with suicidal thoughts, seek help from a professional and call 9-8-8. The United States’ first nationwide three-digit mental health crisis hotline 988 will connect callers with trained mental health counselors. Text “HOME” to 741741 in the U.S. and Canada to reach the Crisis Text Line.
Last year, California parents sued ChatGPT maker OpenAI after their son Adam Raine died by suicide. ChatGPT, the lawsuit alleged, provided information about suicide methods, including the one the teen used to kill himself. OpenAI has said it takes safety seriously and rolled out new parental controls on ChatGPT.
The lawsuits have spurred more scrutiny from parents, child safety advocates and lawmakers, including in California, who passed new laws last year aimed at making chatbots safer. Teens are increasingly using chatbots both at school and at home, but some have spilled some of their darkest thoughts to virtual characters.
“We cannot allow AI companies to put the lives of other children in danger. We’re pleased to see these families, some of whom have suffered the ultimate loss, receive some small measure of justice,” said Haley Hinkle, policy counsel for Fairplay, a nonprofit dedicated to helping children, in a statement. “But we must not view this settlement as an ending. We have only just begun to see the harm that AI will cause to children if it remains unregulated.”
One of the most high-profile lawsuits involved Florida mom Megan Garcia, who sued Character.AI as well as Google and its parent company, Alphabet, in 2024 after her 14-year-old son, Sewell Setzer III, took his own life.
The teenager started talking to chatbots on Character.AI, where people can create virtual characters based on fictional or real people. He felt like he had fallen in love with a chatbot named after Daenerys Targaryen, a main character from the “Game of Thrones” television series, according to the lawsuit.
Garcia alleged in the lawsuit that various chatbots her son was talking to harmed his mental health, and Character.AI failed to notify her or offer help when he expressed suicidal thoughts.
“The Parties request that this matter be stayed so that the Parties may draft, finalize, and execute formal settlement documents,” according to a notice filed on Wednesday in a federal court in Florida.
Parents also sued Google and its parent company because Character.AI founders Noam Shazeer and Daniel De Freitas have ties to the search giant. After leaving and co-founding Character.AI in Menlo Park, Calif., both rejoined Google’s AI unit.
Google has previously said that Character.AI is a separate company and the search giant never “had a role in designing or managing their AI model or technologies” or used them in its products.
Character.AI has more than 20 million monthly active users. Last year, the company named a new chief executive and said it would ban users under 18 from having “open-ended” conversations with its chatbots and is working on a new experience for young people.
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