Time: Wed Jul 16 05:58:53 1997 by primenet.com (8.8.5/8.8.5) with ESMTP id FAA23483 for [address in tool bar]; Wed, 16 Jul 1997 05:46:22 -0700 (MST) by usr09.primenet.com (8.8.5/8.8.5) with SMTP id FAA09121; Wed, 16 Jul 1997 05:45:39 -0700 (MST) Date: Wed, 16 Jul 1997 05:45:16 -0700 To: (Recipient list suppressed) From: Paul Andrew Mitchell [address in tool bar] Subject: SLS: Year 2000 computer date crisis <snip> > >This Year 2000 Computer Date crisis has about been beat to death. >However, this is the most exhaustive analysis of the scenario that I've >seen, and when you pursue the link to the site, it really goes to town. >Discounting any potential motives for sensationalizing overkill, Gary >North does raise some points I had trouble dismissing! HT > <snip> > > BLIND MAN'S BLUFF IN THE YEAR 2000 > > > What are you going to be doing for as living in the >year 2001? Unless you're a fix-it man living in a small >town, you won't be doing what you do today. If you make >your living in financial services, you will surely be doing >something else. If you're a journalist, you will be in a >new profession. But what? What other useful service can >you provide? You have very little time to make the switch. >Let me show you why. > > We live in a world that depends on a high division of >labor. That world has less than three years to go. In one >gigantic collapse, the division of labor will implode. >This implosion will begin in 1999. It will accelerate in >2000 and thereafter. Those who work in highly specialized >fields will find little or no demand for their skills, in >the face of an enormous supply of desperate, low-wage >competition. Any job classification that did not exist in >1945 will probably not have a lot of demand in 2001, with >one exception: computer software programming. > > The June 2 issue of Newsweek ran a front-cover story >on the looming computer crisis of the Year 2000 -- called >y2k (Year 2 K -- shorthand for a thousand). In the week it >the article appeared (late May), the Dow Jones Industrial >Average set a record new high. (It was beaten a week >later.) If investors believed the information reported in >the Newsweek article, the world's stock markets would have >collapsed. Clearly, people don't believe it. That's why a >small handful of people can get out now -- out of the stock >market, the bond market, and any city over 25,000. > > Not everyone can get out at the top of a bull market. >This includes the "bull market" known as modern industrial >society. Pull the plug on the local power utility for 30 >days, and every city on earth becomes unlivable. What if >the plug gets pulled for five years? > > How do you rebuild the shattered economy if the >computers go down, taking public utilities with them? >Without electricity, you can't run the computers. Without >computers, you can't fix computers. How can you assemble >teams of programmers to fix the mess? More to the point, >how do you pay them if the banks are empty? > > Chase Manhattan Bank has 250 million lines of code to >check and then repair. Citicorp has 400 million lines. >All big banks are similarly afflicted. And even if this >could be fixed, bank by bank, there is no universal repair >standard. Thus, the computers, even if fixed (highly >doubtful) will not work together after the individual >repairs. A noncompliant bank's data will then make every >compliant bank noncompliant. Thus, the world banking >system will crash in 2000. When the public figures this >out in 1999, the bank runs will begin. > > You will not have a job in 2000. Count on it. > > > "It Just Can't Be True!" > > You don't believe me, of course. Not yet. But I have >published the evidence on this Web site. You can verify >what I'm saying. But you still won't believe it. Why not? >Because it's too painful. In their new book, The Sovereign >Individual, Davidson and Rees-Mogg make a very important >observation: > > A recent psychological study disguised as a > public opinion poll showed that members of > individual occupational groups were almost > uniformly unwilling to accept any conclusion that > implied a loss of income for them, no matter how > airtight the logic supporting it. Given > increased specialization, most of the > interpretive information about most specialized > occupational groups is designed to cater to the > interests of the groups themselves. They have > little interest in views that might be impolite, > unprofitable, or politically incorrect (p. 339). > > My views are all three: impolite, unprofitable, and >politically incorrect. Impolite, because I am saying this: >(1) those advising you are as blind as an eighth-century >Israelite king; (2) they have given you information that >will prove to be wildly unprofitable; (3) all the hype >about your getting rich -- the world's getting rich -- is a >clap-trap. We are heading for a disaster greater than >anything the world has experienced since the bubonic plague >of the mid-14th century. > > Because the year 2000 begins on a Saturday, millions >of victims will not be aware of their dilemma until the >following Monday or Tuesday. They will pay no attention to >advance warnings, such as this one, that they are at risk. > > As you read this report, I want you to think to >yourself: "How will this affect me? Is my business at >risk? Is my income at risk? What should I do?" > > > The Origin of the Problem > > Here is the problem. Over three decades ago, computer >programmers who wrote mainframe computer software saved >disk space -- in those days, very valuable space -- by >designating year codes as two-digit entries: 67 instead of >1967, 78 instead of 1978, etc. Back then, saving this >seemingly minuscule amount of disk space seemed like an >economically wise decision. This may prove to be the most >expensive forecasting error since Noah's flood. > > What the programmers ignored for three decades is >this: in the year 2000, the two digits will be 00. The >computer will sit there, looking for a year. At midnight, >January 1, 2000, every mainframe computer using unrevised >software dies. If old acquaintances are in the computer, >they will indeed be forgot. > > Programmers who recognized the implications of this >change did not care. They assumed that their software >would be updated by year 2000. That assumption now >threatens every piece of custom software sitting on every >mainframe computer, unless the owner of the computer has >had the code rewritten. In some cases, this involves >coordinating half a billion million lines of code. >(Example: AT&T>) One error on one line can shut down the >whole system, the way that America Online was shut down for >a day in 1996 because of a one-digit error. > > The handful of reporters who have investigated this >problem have met a wall of indifference. "We're all using >microcomputers now." "This is a problem only for a few >companies that are still using mainframes." "Cheap >solutions will appear as soon as there is demand." "The >software will be updated soon, and I'll buy it then." "If >this were a serious problem, we'd have heard about it." >Yet this last response is given to someone -- a reporter -- >who is trying to tell people about the problem. > > I first read about this problem years ago in a book by >the pseudonymous author, Robert X. Cringely: Accidental >Empires. It is not as though the computer industry has >been unaware of it. Only a few weeks ago, I read a Wall >Street Journal column on computers that mentioned it. The >writer wrote that his editor is getting tired of having him >mention it. This is typical. The general public hasn't >heard about it, yet editors are already tired of hearing >about it. "It's old news." Well, it's new news for most >people. > > What does it matter, really? We use microcomputers. >Microsoft has solved the Year 2000 problem. So have most >software companies. Everyone uses desktop computers or, at >the largest, minicomputers, right? Wrong. > > > Governments Rely on Aging Mainframes and Software > > On September 24, 1996, Congressman Stephen Horn, who >is Chairman of the Subcommittee on Government Management, >Information, and Technology, submitted to the full >committee a report on the Year 2000 problem. The >Subcommittee held hearings on April 16. (Just one day of >hearings. This indicates the degree of concern that the >government has.) He said that these hearings revealed "a >serious lack of awareness of the problem on the part of a >great number of people in business and government. Even >more alarming was the cost estimate reported to the >Subcommittee to remedy the problem, which was said to be >$30 billion for the Federal Government alone." Then he >announced: > > Without greater urgency, those agencies risk > being unable to provide services or perform > functions that they are charged by law with > performing. Senior agency management officials > must take aggressive action if these problems are > to be avoided. > > Yet despite Horn's valid warning, nothing visible is >happening. He knows this. These agencies must shift >hundreds of millions of dollars from their existing budgets >to hire outside programmers to rewrite the code that runs >these agencies. This isn't being done. More to the point, >the longer they delay, the worse the problem gets. You >can't just go out and hire programmers who are familiar >with the code. As businesses find out what threatens them, >the demand for these highly specialized services will soar. >(If businessmen don't figure this out in time, payment will >come due in January of 2000.) > The Subcommittee's report warns: "This issue may cause >banks, securities firms and insurance companies to >ascertain whether the companies they finance or insure are >year 2000 compliant before making investment decisions." >It also says that companies will start demanding >contractual warranties guaranteeing against Year 2000 >breakdowns. > A memorandum from the Library of Congress Research >Service (CRS) has warned that "it may be too late to >correct all of the nation's systems." So, the question >arises: Which systems will survive and which ones won't? >Here are some problem areas, according to CRS: > > Miscalculation by the Social Security > Administration of the ages of citizens, > causing payments to be sent to people > who are not eligible for benefits while > ending or not beginning payments to > those who are eligible; > > Miscalculation by the Internal Revenue > Service of the standard deduction on > income tax returns for persons over age > 65, causing incorrect records of > revenues and payments due; > > Malfunctioning of certain Defense > Department weapon systems; > > Erroneous flight schedules generated by > the Federal Aviation Administration's > air traffic controllers; > > State and local computer systems > becoming corrupted with false records, > causing errors in income and property > tax records, payroll, retirement > systems, motor vehicle registrations, > utilities regulations, and a breakdown > of some public transportation systems. > > I don't think these are small issues. They will >probably start receiving media attention when it is so late >in the process that there will be massive foul-ups in >coordinating the revisions. > > Notice, the biggest one is missing: an international >bank run, as depositors demand cash. From that day on, all >exchanges will be local: the collapse of the division of >labor. > > When the computers' clocks think it's 1900, it soon >will be. > > I realize that there has been tremendous progress in >microcomputer power, but does anyone really think that all >of the Federal government's forms -- not an infinite >number, but approaching infinity as a limit -- can be put >on three dozen Compaq desktop computers and run with, say, >Lotus Approach or Microsoft Access? And even if they >could, how would you re-train all of the bureaucrats to use >the new systems? How fast will they learn? How fast do >bureaucracies adapt? The Subcommittee's report warns: > > The clock is ticking and most Federal agencies > have not inventoried their major systems in order > to detect where the problem lies within and among > each Federal department, field office and > division. The date for completion of this > project cannot slip. > > By "cannot," the Subcommittee's report-writer meant >"must not." The date can surely be allowed to slip. It >almost certainly will be allowed to slip. > > Additionally, the task may be more difficult for > the public sector, where systems have been in use > for decades, may lack software documentation and > therefore increase the time it takes from the > inventory phase to solution. > > Did you get that? The software code's records are >gone! Remember also that we're not just talking about the >United States government. We're talking about every >government -- national, state, and local -- anywhere on >earth that has its data stored on an unrevised mainframe >computer system or which relies on any third-party computer >service that uses uncorrected software. > > As the year 2000 approaches, word will slowly begin to >spread: "After the three-day weekend that will inaugurate >the year 2000, there is going to be a hangover the likes of >which we have never seen before." For some, it will be a >time of celebration. For others, it will be the end of >their dreams. It depends on whether they are being >squeezed by the government or dependent on it. > > But it's not just government that is at risk. It's >private industry. > > > Kiss Medicare Goodbye > > Some 38 million people will receive Medicare payments >in 1997. In 2000, an estimated one billion claims will be >filed, totalling over $288 billion. This, according to a >May 16, 1997 report of the General Accounting Office (GAO): >"Medicare Transaction System." > > Problem: the Medicare system won't make it through >2000. The same GAO report shows why. Medicare claims are >not actually administered by Medicare. It's administered >by 70 private agencies. These agencies have been informed >that their contracts will not be renewed in 2000. > > The agency that officially supervises Medicare has >plans for one huge computer system that will bring the >program in-house. It is the same dream that motivated the >Internal Revenue Service for the past 11 years. The IRS >announced earlier this year that after 11 years and $4 >billion, the attempt had failed. > > Medicare now knows that it has a problem with its >computers. They are not Year 2000-compliant. So, to make >sure that they will be compliant, Medicare has issued an >appeal to the 70 newly canned companies: please fix the >year 2000 problem for us before you leave. As the GAO >report puts it, "contractors may not have a particularly >high incentive to properly make these conversions. . . ." > > What if the system fails? (What if? Are they >kidding? When!) The report says that the Health Care >Financing Administration (HCFA), which is responsible for >running Medicare, has not made contingency plans. "HCFA >officials are relying on the contractors to identify and >complete the necessary work in time to avoid problems. Yet >the . . . . contractors not only have not developed >contingency plans, that have said that they do not intend >to do so because they believe that this is HCFA's >responsibility." > > > Kiss the IRS Goodbye > > The IRS has 100 million lines of code. Their code is >not year 2000-compliant. After the failure of the 11-year >project to upgrade the system, Chief Information Officer >Arthur Gross announced that getting the IRS year 2000- >compliant is the "highest priority for the IRS." The IRS >has nearly 50,000 code applications to coordinate and >correct. This task will require the IRS to move 300 full- >time computer programmers to the new project. (Reported in >"TechWeb," April 21, 1997). > > For comparison purposes, consider the fact that the >Social Security Administration began working on its year >2000 repair in 1991. Social Security has 30 million lines >of code. By June, 1996, the SSA's 400 programmers had >fixed 6 million lines. > > What if the IRS isn't technically equipped to pursue >tax evaders after December 31, 1999? What if the IRS >computer system isn't fully integrated with all of its >branch offices? What if the system's massive quantities of >forms are not stored in a computer system that is Year >2000-compliant? More to the point, what if 20% of >America's taxpayers believe that the IRS can't get them if >they fail to file a return? > > In 1999, the IRS may find a drop in compliance from >self-employed people. If the IRS can't prosecute these >people after 1999, there will be a defection of compliance >by the self-employed. When word spreads to the general >public, there will be a hue and cry -- maybe at first >against the evaders, but then against employers who are >sending in employees' money when self-employed people are >escaping. Meanwhile, cash-only, self-employed businesses >will begin to lure business away from tax-compliant >businesses by offering big discounts. > > This will start happening all over the world. Once it >begins, it will not easily be reversed. The tax system >rests on this faith: (1) the government will pay us what it >owes us; (2) the government can get us if we stop paying. >Both aspects of this faith will be called into question in >the year 2000 if the governments' computers are not in >compliance. > > Big Brother is no more powerful than his software. On >January 1, 2000, this strength may fall to zero. Actually, >double zero. > > If the IRS cannot collect taxes, and if all the other >mainframe computer-dependent tax collection agencies on >earth do not fix this, what will happen to the government >debt markets worldwide? To interest rates? To the >government-guaranteed mortgage market? > > Kiss them all goodbye. > > > "No Problem! Trust me!" > > There are a few conservative financial newsletter >writers who have heard about y2k. They deny its economic >relevance. A shut-down of all mainframe computers would >mean that newsletter writers will be out of business after >1999 -- a thought too terrifying for them. So, they brush >y2k aside with some version of this rebuttal: "Of course, >the government may not get its computers fixed." This is >supposed to calm you. It should terrify you. Ask >yourself: > > What happens to T-bills and T-bonds if the > IRS computer breaks down and a tax revolt spreads > because taxpayers know the IRS will never find > them, and that if they pay their taxes, they > won't get their refunds? > > What happens to money market funds and bond > funds that invest heavily in government debt when > investors realize that if the IRS can't collect > taxes, the government will default on its debt? > > What happens to the banks when depositors > figure out that the FDIC is bankrupt and that > nobody insures their accounts any more? > > What happens to your job when the banks > close because of bank runs, and no business can > borrow money or even write a check to its > employees? > > What happens to the delivery of food into > cities when money fails because the banks are > busted? > > What happens to the delivery of public > utilities when money fails because the banks are > busted? > > What happens to your retirement fund when > ERISA, the government pension guarantee program, > goes bankrupt? > > What happens to the 38 million people in the U.S. > who are dependent on Medicare? (Medicare is > administered by 70 private firms that have all been > told they will be fired in 2000 when Medicare installs > its new computer system, but in the meantime, they > have been asked to do the year 2000 repair on their > own, to deliver a fixed system to the government in > 1999. Does this sound crazy? Of course. It's the > government. See my Web site for confirmation of this > story: a May 16 government report.) > > What happens to 42 million people on Social > Security? > > What happens to every state government? > > What happens to crime rates when the state > cannot imprison violent criminals and may have to > release those who are locked up because they > can't be fed? > > What happens to the world economy when this > scenario is multiplied across every government? > > Kiss you job goodbye. Especially if you're a >journalist. I know. I am one. I figure I'll be out of >work -- forced retirement -- January 1, 2000. I'm making >plans to be in small-scale agriculture. I'm out of debt. > > What about you? > > > Psychological Deferral > > Those in authority prefer to defer thinking about >this. They are playing Scarlett O'Hara: "I'll think about >it tomorrow," followed by, "Well, fiddle dee-dee." >Deferral is a normal response to distant problems. The >question is: What can we afford to defer? People defer >making this assessment. The fact that you have not read >much about this looming problem doesn't mean that it isn't >a problem. If your employer has not actively sought >solutions to this problem, your firm had better not use >mainframe computers or be dependent on suppliers that rely >on mainframe computers. > > Everyone assumes that someone else is doing something >to solve these problems. "It's being taken care of." The >problem here is the passive voice. Who, exactly, is taking >care of it? What, exactly, is this person doing? Is he on >schedule? How do you know for sure? Are you taking his >word for it? Anyone who takes the word of a computer >programmer that he is on schedule is a person of very great >faith. If the programmer says "Sorry, I didn't make it" on >December 31, 1999, you're dead in the water. Meanwhile, he >moves on. > > > What You Should Do, Beginning Today > > First, you investigate whether what I'm saying is >true. > > Second, think through what happens to you if the local >power company and the local water and sewage company shut >down in your city for six months. "Who ya gonna call?" >Especially if your phone is dead? And if you do get >through, how ya gonna pay if your local bank is defunct? > > Third, here is my personal strategy. I have adopted a >question: > > "Can I prove on paper that he owes it to me?" > > I want hard copy print-outs of everything I do with >the government. If you are owed money from Social >Security, and you're dependent on this income, contact the >Social Security Administration every year and get a letter >telling you what you're owed. This is true of every >government pension system. > > Do you have a copy of your birth certificate? If not, >write to your place of birth and get it. Even if that >community has not computerized the records, do it now. >Even if it keeps the records in a desktop, do it. If word >starts to spread, they may be buried in requests in 1999. >You want your paperwork completed before word gets out. > > Do you have a copy of your college transcripts? If >not, get it. The same goes for your work record history. >Assume that your records are in some company's mainframe >computer. Assume also that the company has failed to >update the software. > > Do you have a print-out of all of your insurance >records? Would they stand up in court? If not, get what >you need, now. > > Have you spoken with your local insurance agent? Is >he fully aware of the problem? Ask him straight out if he >has scheduled an update of his software if he relies on >vendor-supplied software. He deserves to know what is >coming. So do you. (If you want to photocopy this issue >to send him, go ahead.) > > Think through this problem in advance, before it gets >out and creates a banking panic, all over the world. This >story will get out eventually. In 1999, when reporters are >running around looking for sensational Year 2000-third >millennium stories, this one will at last surface. It >already has: in Newsweek. At that point, every government >bureaucrat whose agency is at risk will start playing the >"No problem" game. "It's being taken care of." The >bureaucrat's number-one rule is to evade responsibility. >No one with any authority is going to admit that his >malfeasance in office is going to create a disaster on Jan. >1, 2000. The basic response will be this: "There's no >problem here, and furthermore, I'm not responsible when >everything collapses next year!" > > Keep visiting my Web site for updated information: > > http://www.garynorth.com > > E-mail this report to anyone you care about. > >--------- End forwarded message ---------- > <snip> ======================================================================== Paul Andrew Mitchell : Counselor at Law, federal witness B.A., Political Science, UCLA; M.S., Public Administration, U.C. Irvine tel: (520) 320-1514: machine; fax: (520) 320-1256: 24-hour/day-night email: [address in tool bar] : using Eudora Pro 3.0.3 on 586 CPU website: http://www.supremelaw.com : visit the Supreme Law Library now ship to: c/o 2509 N. Campbell, #1776 : this is free speech, at its best Tucson, Arizona state : state zone, not the federal zone Postal Zone 85719/tdc : USPS delays first class w/o this As agents of the Most High, we came here to establish justice. We shall not leave, until our mission is accomplished and justice reigns eternal. ======================================================================== [This text formatted on-screen in Courier 11, non-proportional spacing.]
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