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Date: Sat, 13 Dec 1997 04:15:03 -0800
To: (Recipient list suppressed)
From: Paul Andrew Mitchell [address in tool bar]
Subject: SLS: IRS may be in deep trouble (fwd)

>A little fairy tale.
>Has a happy ending, and everything...
>Bob Hettinga
>--- begin forwarded text
>Date: Wed, 17 Sep 1997 19:13:41 -0500
>From: Bill GL Stafford <springco@arn.net>
>Organization: Spring Management Company
>MIME-Version: 1.0
>To: Robert Hettinga <rah@shipwright.com>
>Subject: Preparing the Remnant for the far side of the crisis
>This is a rather long post.  I wanted for you to see it personally.   It
>important and I wanted to clear it thru you.  If I don't see it posted I
>will know
>you did not chose to post it.
>Best personal regards,
>Bill GL Stafford
>Began fowarded mail:
>>From:             jmcnally@bigdog.fred.net
>>Date sent:        Thu, 11 Sep 1997 10:42:20 -0400 (EDT)
>>Subject:          REMNANT REVIEW of September 5, 1997
>>Gary North's
>>                              REMNANT REVIEW
>>emailbonus:                                       Matt. 6:33-34
>>           Preparing the Remnant for the far side of the crisis
>>Vol. 24, No. 9                 590              September 5, 1997
>>       I am hereby lifting the copyright of this issue of
>>       Remnant Review.  This one I want you to send to your
>>       friends, neighbors, boss, Congressman, and anyone
>>       else who might want advance information on the end,
>>       at long last, of the 16th Amendment: vetoed by Year
>>       2000 noncompliant computers.  Photocopy it, print it,
>>       whatever.  Then visit my Web site for full documen-
>>       tation (under "Government"):
>>     What I am about to report will verify what I have been saying all
>>year.  If this doesn't constitute proof, I don't know what can persuade
>>you.  From this point on, anyone who tells you that the Millennium Bug
>>is not a big deal, or who says, "We'll just have to wait and see about
>>there's no need to hurry," simply doesn't know what he's talking about.
>>Ignore him.
>>     On August 21, I stumbled into the most amazing government
>>document I have ever seen.  I had read a brief news story about a
>>company that had applied for a contract to work as a subcontractor for
>>the IRS in a restructuring of its computer systems.  The IRS admitted to
>>Congress last January that its $4 billion, 11-year attempt to modernize
>>its computer systems had failed.  Here was a follow-up story.  So, I
>>to the company's Web site to find more information.  This led me on a
>>merry chase across the Web.
>>     Finally I landed on the IRS's page -- specifically, its page
>>relating to
>>its PRIME project.  There were pages of blue links to documents, each
>>one with a strange name or the name of a state.  It was not clear to me
>>first what I had discovered.  So, I started clicking links. I found
>>nothing that I could understand, link after link: government
>>Then I hit pay dirt: the mother lode, my friends -- what we have been
>>waiting for since 1913.  Deliverance.  Free at last, free at last!  THE
>>     This amazing admission appears in an innocuously titled document,
>>"Request for Comments (RFC) for Modernization Prime Systems
>>Integration Services Contractor" (May 15, 1997).  The author is Arthur
>>Gross, Associate Commissioner of the IRS and Chief Information
>>Officer, i.e., the senior IRS computer honcho.  It was Mr.  Gross who
>>went before Congress in January to admit defeat.
>>     Mr. Gross now says that the IRS is no longer capable of operating
>>own computer systems.  The IRS has over 7,500 people involved in just
>>computer maintenance, with a budget a $1 billion a year (Appendix B.
>>p. 2), yet they can no longer handle the load.  And so, says Mr. Gross,
>>some of them are going to get fired.  You can imagine the continuing
>>morale problem that this announcement will cause!  The IS (information
>>systems) division will be, as they say, DOWNSIZED.  From now on, the
>>IRS must achieve the following:
>>           . . . shifting the focus of IS management to a
>>           business orientation: servicing customers with
>>           exponentially increasing technology needs,
>>           implementing massive new technology applications
>>           on schedule within budget while managing the
>>           downsizing of the IS organization
>>           (Appendix B. p. 2).
>>     Do you think that people slaving away in their cubicles, trying to
>>the Millennium Bug, will respond favorably to this notice?  "Fix it, and
>>then you're out!"  Mr. Gross knows better.  So, with this amazing
>>document, he calls on private industry to come in and TAKE OVER
>>calls "a strategic partnership" (p. 1).  The new partners will have to
>>the Millennium Bug.  The IRS will give them exactly eight months, start
>>to finish: October 1, 1998 to the end of June, 1999.
>>                     The IRS's Digital Augean Stables
>>     Perhaps you have had trouble on occasion getting information from
>>the IRS about your account.  After reading this document, I now know
>>why.   The information is held in what the IRS calls "Master Files" (p.
>>4).  These files are held in the Martinsburg, West Virginia, computer.
>>This computer receives data sent in by 10 regional centers that use a
>>total of 60 separate mainframes.  These mainframes do not talk to each
>>other.  Or, as Mr. Gross puts it, they are part of "an extraordinarily
>>complex array of legacy and stand-alone modernized systems with
>>respect both to connectivity and inoperability between the mainframe
>>platforms and the plethora of distributed systems" (p. 4).  This is
>>bureaucratese, but I do understand the word, INOPERABILITY.
>>     The tax data build up in the local mainframes for five business
>>Then they are uploaded to West Virginia.  This may take up to 10 actual
>>days.  Then the Martinsburg computer sends it all back to the regional
>>computers in the Service Centers.  Then the information is made
>>available to the "Customer Service Representatives" (p. 5), i.e., local
>>collectors.  The elapsed time may take two weeks.
>>     But . . . it turns out that the actual source payment documents are
>>not sent to the Master Files.  Neither is "specific payment or tax
>>information."  This information stays in what the IRS calls
>>STOVEPIPED SYSTEMS, meaning stand-alone data bases "which, for
>>the most part, are not integrated with either the Master Files or the
>>corporate on-line system, IDRS" (p. 5).  Separate tax assessments for
>>same person can appear in six separate systems, and these do not
>>communicate with each other (p. 5).  "Further, each system generates
>>management reporting information which is not homogeneous, one with
>>the other . . ." (p. 7).  To help us visualize this mess, and much
>>messes, the document includes charts.  These charts are so complex that
>>my printer was unable to print out the 116-page document -- probably
>>not enough RAM.  I had to get two other people involved to get one
>>readable copy.
>>     I have included one of these charts on the back page, just for fun.
>>Go ahead.  Take a quick look.  No need to get out your magnifying glass
>>just yet.   Then comes the key admission: "These infrastructures are
>>largely not century date compliant . . ." (p. 11).  The phrase "century
>>date compliant" is the government's phrase for Year 2000-compliant.  In
>>Now hear this:
>>          In addition to three computing centers, (Memphis,
>>          Detroit and Martinsburg) the latter of which is a
>>          fully operational tax processing center, the IRS
>>          deploys a total of sixty mainframes in its ten
>>          regional service centers.
>>          None of the mainframes are compliant, thereby
>>          necessitating immediate actions ranging from
>>          systems software upgrades to replacement (p. 9).
>>It gets worse:
>>          A still greater and far reaching wave of work
>>          in the form of the Century Date Project is
>>          cascading over the diminishing workforce that
>>          is already insufficient to keep pace with the
>>          historical levels of workload.  For the Internal
>>          Revenue Service, the Century Date Project is
>>          uniquely challenging, given the aged and non-
>>          century compliant date legacy applications and
>>          infrastructure as well as thousands of undocumented
>>          applications systems developed by business personnel
>>          in the IRS field operations which are resident on
>>          distributed infrastructures but not as yet
>>          inventoried (p. 13).
>>     Notice especially two key words: "undocumented" and "inventoried."
>>"Undocumented" means there is no code writer's manual.  They either
>>lost it or they never had it.  "Inventoried" means they know where all
>>the code is installed.  But it says: "not as yet inventoried."  How much
>>code?  Lots.
>>          The IS organization has inventoried and scheduled
>>          for analysis and conversion, as required, the
>>          approximately 62 million lines of computer code
>>          comprising the IRS core business systems.  With
>>          respect to the business supported field
>>          applications and infrastructures, however, we do
>>          not know what we do not know.  Until central field
>>          systems and infrastructures are completed, the IRS
>>          will be unable to analyze, plan, and schedule the
>>          field system conversion (p. 13).
>>     I love this phrase: WE DO NOT KNOW WHAT WE DO NOT
>>KNOW.  This is surely not bureaucratese.  Now, let's put all of this
>>a clearer perspective.  The Social Security Administration discovered
>>y2k problem in 1989.  In 1991, programmers began to work on
>>correcting the agency's 30 million lines of code.  By mid-1996, they had
>>completed repairs on 6 million lines (CIO Magazine, Sept. 15, 1996.)
>>Got that?  It took five years for them to fix 6 million lines.  But the
>>has 62 million lines THAT THEY KNOW ABOUT, but they don't know
>>about the rest.  It's out there, but there is no inventory of it.
>>     Consider the fact that they have not completed their inventory. 
>>1996 "California White Paper," which is the y2k guide issued by the IS
>>division of the California state government's y2k repair project, says
>>inventory constitutes 1% of the overall code repair project.  Awareness
>>is 1%.  So, after you get finished with inventory, YOU HAVE 98% OF
>>YOUR PROJECT AHEAD OF YOU.  Meanwhile, the IRS has not yet
>>completed its inventory.
>>     The IRS has led the American welfare state into a trap.  The
>>government, like the U.S. economy, will be restructured in the year
>>2000.  Most Americans will be in bankruptcy by 2001, but they will be
>>     Meanwhile, the news media are all a-dither about the Clinton-
>>Congress accord on taxes, which will balance the budget in 2002.  As
>>George Gobel used to say, "Suuuuuure it will."  Who is going to collect
>>revenues in 2000?
>>                   Please Help Get Us Out of This Mess!
>>     The next section of Mr. Gross's report I find truly unique. When
>>the last time you read something like this in an agency's report on its
>>own capacity?  (The next time will be the first.)
>>         MODERNIZATION (p. 13).
>>     This states the IRS's problem clearly: its computer systems are
>>barely making it now, and the Year 2000 Problem will torpedo them.
>>          Mr. Gross then announces the IRS's solution: quit.  The IRS
>>now admitted that "tax administration is its core business" and it will
>>now "shift responsibility for systems development and integration
>>services to the private sector . . ." (p. 54).  But first, it must find
>>some well-heeled partners.
>>     "The IRS has acknowledged that its expertise now and in the future
>>is tax administration."  This means that "the IS organization must be
>>rebuilt to preserve the existing environment and partner with the
>>sector to Modernize the IRS" (p. 13).  I love it when someone
>>"Modernize."  Especially when it really means "officially bury."
>>     Then the coup de grace: "Any reasonable strategy to move forward,
>>therefore, would focus on managing the immediate crisis -- 'stay in
>>business' while building capacity to prepare for future Modernization"
>>(p. 14).  Then comes part 2 of the report:
>>                         The Next Eighteen Months:
>>                          Staying in Business and
>>                        Preparing for Modernization
>>     Mr. Gross knows that there is a deadline, and it isn't 2000.  It's
>>months earlier.  He has selected June, 1999.  Most organizations have
>>elected December, 1998.  This allows a year for testing.  Mr. Gross is
>>more realistic.  He knows late 1998 is too early.  The IRS can't do it.
> (I
>>would say that late 2008 is too early.  The IRS has tried to revamp its
>>computer system before.)
>>     . . . the IRS must undertake and complete major infrastructure
>>initiatives no later than June 1999, to minimally ensure century date
>>compliance for each of its existing mainframes and/or their successor
>>platforms.  At the same time, the IRS must complete the inventory of its
>>field infrastructures as well as develop and exercise a century date
>>compliance plan for the conversion replacement and/or elimination of
>>those infrastructures. (p. 19).
>>     Then comes an astounding sentence.  This sentence is astounding
>>because it begins with the word, IF.  (Note: RFC stands for Request for
>>   If...? IF...?  He is warning all those private firms that he is
>>in to clean up the mess that they may not be given the code analysis. 
>>code analysis constitutes the crucial 15% of any Year 2000 repair job,
>>according to the California White Paper.  Then, and only then, can code
>>revision begin.
>>     Meanwhile, the IRS system's code is collapsing even without y2k.
>>The programmers are not able to test all of the new code.  Mr.  Gross
>>calls this "Product Assurance."  This division, he says, has "sunk to
>>staffing levels less than 30 percent of the minimum industry standard .
>>.. ."  This makes it "one of the highest priorities within the IS
>>organization, given that, today, major tax systems are not subjected to
>>comprehensive testing prior to being migrated to production" (p. 15). 
>>short, Congress passes new tax code legislation, and the IRS
>>programmers implement these changes WITHOUT TESTING THE
>>NEW CODE.  Now comes y2k.  As he says, "the Century Date
>>Conversion will place an extraordinary additional burden on the Product
>>Assurance Program."  I don't want to bore you, but when I find the most
>>amazing government document I've ever seen, I just can't stop.  Neither
>>could Mr. Gross:
>>     Regrettably, the challenge is far more overarching: to modernize
>>functioning but aged legacy systems which have been nearly irreparably
>>overlaid by and interfaced with a tangle of stovepiped distributed
>>applications systems and networked infrastructures (p. 55).
>>     I'll summarize.  The IRS has got bad code on 63 aging mainframe
>>systems, plus micros.  It has lost some of the code manuals.  It does
>>know how much code it has.  It must now move ("migrate") the data
>>from these y2k noncompliant computers -- data stored in legacy
>>programs that are not y2k compliant -- to new computers with new
>>programs.  These computers must interact with each other, unlike
>>today's system.  Bear in mind that some of this code -- I have seen
>>estimates as high as 30% -- is written in Assembler language, which is
>>not understood by most programmers today: perhaps 50,000 of them,
>>worldwide (Cory Hamasaki's estimate).  Then everything must be tested,
>>side by side, old system vs. new system, on mainframe computers, before
>>anyone can trust anything.  (This assumes that extra mainframes are
>>available, but they aren't.)  Warning:
>>     Beyond the magnitude of the applications system migration, the
>>complexity and enormity of the date conversion that would be required
>>necessitates careful planning and risk mitigation strategies (e.g.,
>>parallel processing).  While the risks inherent in Phase III may be
>>incalculable given the age of the systems, the absence of critical
>>documentation, dependency on Assembler Language Code (ALC) and
>>the inevitable turnover of IRS workforce supporting these systems, it is
>>essential to plan and execute the conversion of the Master Files and its
>>related suite of applications (p. 30).
>>     I'll say it's essential!  The key question is: Is it possible?  No.
>>     Can you believe this sentence?  "The risks inherent in Phase III
>>be nearly incalculable . . ."  What does he mean, "may be"?  They ARE.
>>    Meanwhile, Congress keeps changing the Internal Revenue Code.
>>This creates a programming nightmare: coding the new laws.  So, how
>>big is this project?  Here is how Mr. Gross describes it: "Modernization
>>is the single largest systems integration undertaking in world eclipsing
>>in breadth and depth any previous efforts of either the public or
>>sector.  Given the fluid nature of the Nation's Tax Laws, Modernization
>>is likely to be the most dynamic, creating even greater complexity and,
>>in turn, compounding the risks" (p. 54).  Many, many risks.
>>     Two questions arise: (1) Who is going to fix it?  (2) At what
>>The answer?  He has no answer.  All he knows is that this project is so
>>For this project, the IRS is not saying what its "partners" will be
>>It's open for negotiation.
>>     You may be thinking: "Boondoggle."  I'm thinking: "Legal liability
>>in 2000 larger than any company's board of directors would rationally
>>want to risk, unless they think Congress will pass a no-liability law in
>>2000."  Here is Mr. Gross's description of the special arrangement.  Pay
>>close attention to the words "competitive process."  He bold faces
> I
>>do, too.
>>     Our challenge, therefore, is to FORGE A BUSINESS PLAN AND
>>     PUBLIC/PRIVATE PARTNERSHIP in accordance with federal
>>     governmental procurement laws and regulations ABSENT THE
>>     He calls on businesses to create a "DETAILED SYSTEMS
>>DEVELOPMENT PLAN" (p. 60).  He goes on: "In general, the IRS
>>seeks to create a business plan which: Shares risk with the private
>>sector; Incents [incents???!!!] the private sector to either share or
>>assume the 'front end' capital investment . . ." (p. 60).  Read it
>>Yes, it really says that.  THE IRS WANTS THE PRIVATE SECTOR
>>     This is why the minimum requirement for a company to make a bid
>>is $200 million in working capital.  It has to have experience in
>>computers.  It must be able to repair 5 million lines of code (p. 70).
>>     How complex is this job?  The complexity is mind-boggling: a seven-
>>volume "Modernization Blueprint."  To buy it on paper costs $465, or
>>you can get a copy on a free CD-ROM.  Needless to say, I got the CD-ROM.
>>     So, you think, at least the IRS is getting on top of this problem.
>>Suuuuure, it is.  The contract award date is [let's hear a drum roll,
>>please]: October 1, 1998 (p. 73).  How realistic is this?  You may
>>remember Mr. Gross's deadline: June 1999.  So, he expects these firms
>>to be able to fix 62 million lines of noncompliant code, if they can
>>the missing code in the field offices, even though the IRS has lost the
>>documentation for some of this code, in an eight-month window of
>>productivity.  Social Security isn't compliant after seven years of work
>>on less than half the IRS's number of lines of code.
>>     The IRS is facing a complete breakdown.  Its staff can't fix the
>>The IRS wants private firms to pay for the upgrade and manage the
>>computer systems from now on.  It does not know how much code it has.
>>It does not have manuals for all of the old code.  It does not even know
>>how to pay the firms that get the contracts: either by "contractually
>>greed upon fees" or "pursuant to measurable outcomes of the
>>implemented systems" (p. 61).  It has called for very large and
>>experienced firms to submit comments by October 1, 1997.
>>     In short, the IRS does not know what it is doing, let alone what it
>>has to do.  It only knows that it has to find a few suckers in private
>>to bear the costs of implementing a new, improved IRS computer system
>>and then assume responsibility for getting it Year 2000-compliant
>>between October 1, 1998 and the end of June 1999.  ("There's one born
>>every minute.")  Here are 12 companies that have expressed interest:
>>nderson Consulting, Computer Sciences Corporation, EDS
>>Government Services (EDS is not itself y2k compliant), GTE
>>Government Systems, Hughes Information Technology Systems, IBM,
>>Litton PRC, Lockheed Martin Corporation, Northrup Grumman
>>Corporation, Ratheon E-Systems, Tracor Information Systems
>>Company, and TRW.  The list is posted at:
>>                                Conclusion
>>     It's all over but the shouting.  The IRS is going bye-bye.
>>Accompanying it will be the political career of Mr. Gingrich and the
>>historical reputation of Mr. Clinton.  Bill Clinton will be remembered
>>the President on whose watch the Federal government shut down and
>>stayed shut down.  First Mate Newt will try to avoid going down with
>>the ship of state, but he won't make it.  And as for Al Gore . . . . 
>>maybe he can get a job herding cattle on the Texas ranch of his ex-
>>roommate at Harvard, Tommy Lee Jones.  Think of it: not "Gore in
>>2000," but GORED IN 2000.  Mr. Information Highway will hit a dead end.
>>     On June 30, 1999, the IRS will know that its computers are still
>>noncompliant.  On the next day, July 1, fiscal year 2000 rolls over on
>>the Federal government's computers and on every state government's
>>computer that has not rolled over (and shut down) on a bi-annual basis
>>on July 1, 1998.  Almost every state: about half a dozen will roll over
>>October 1, 1999.
>>     In 1999, chaos will hit the financial markets, all over the world
>>assuming that this does not happen earlier, which I do not assume.  The
>>public will know the truth in 1999: THE DEFAULT ON U.S.
>>GOVERNMENT DEBT IS AT HAND.  The tax man won't be able to
>>collect in 2000.  The tax man will be blind.  Consider how many banks
>>and money market funds are filled with T-bills and T-bonds.  Consider
>>how the government will operate with the IRS completely shut down.
>>Congress hasn't thought much about this.  Neither has Bill Clinton.

Paul Andrew Mitchell, Sui Juris      : Counselor at Law, federal witness 01
B.A.: Political Science, UCLA;   M.S.: Public Administration, U.C.Irvine 02
tel:     (520) 320-1514: machine; fax: (520) 320-1256: 24-hour/day-night 03
email:   [address in tool bar]       : using Eudora Pro 3.0.3 on 586 CPU 04
website: http://supremelaw.com       : visit the Supreme Law Library now 05
ship to: c/o 2509 N. Campbell, #1776 : this is free speech,  at its best 06
             Tucson, Arizona state   : state zone,  not the federal zone 07
             Postal Zone 85719/tdc   : USPS delays first class  w/o this 08
_____________________________________: Law is authority in written words 09
As agents of the Most High, we came here to establish justice.  We shall 10
not leave, until our mission is accomplished and justice reigns eternal. 11
======================================================================== 12
[This text formatted on-screen in Courier 11, non-proportional spacing.] 13


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