Most Americans are betting with their feet. Public participation in Y2K preparedness efforts has plummeted in the past few months. Meetings of Washington D.C.'s Y2K group, once the scene of standing-room-only crowds, now play to half-empty rooms -- this despite repeated public warnings about the District's own dire state of readiness. To add insult, the founder of the most prominent citizens' group on the Internet, the Cassandra Project, recently quit, owing to public disinterest.
But the most consequential Y2K bet is the one laid early on by the Clinton Administration and its Council on Year 2000 Conversion, which was less a wager than a fixing of house rules. It becomes increasingly evident that the Clintonites decided at the outset upon a risk calculus that goes like this: The possibility of material disruptions and civil panic around the turn of the century matters less than the financial and economic disruptions -- through stockpiling of goods, bank withdrawals, stock market anxiety -- that might result from more worrisome public dialogue about preparedness.
Small wonder, then, that most people care little and know even less about what may transpire in the months to come. Even among the Y2K-anxious, there generally persists a belief that come New Year's weekend, we'll know the score. This creed carries with it a couple of assumptions: The Y2K crisis, if there is one, will be sudden and acutely felt; and it's almost entirely a question of the so-called Iron Triangle of banking, telecommunications, and utilities, whose performance will deliver us unto -- either business as usual, or the swelling anarchic rage of a public long sundered from any belief in God or man and now bereft of faith in ATMs as well.
If there is any basis at all for the incessant public- and private-sector assurances about Y2K readiness -- and it's hard to believe that corporate America (from McDonald's at $80 million to AT&T at $750 million) is spending all that remediation money for nothing -- that is very probably not how things will go. Y2K problems, on the whole, are far more likely to be chronic and nagging than acute and short-lived, and to result in economic more than civil upheaval.
Which is not to say that one should believe all the assurances regarding a smooth transition at the date change. In the Senate's final report on Y2K, the massive "100-day" document released last month, banking and telecommunications once again received glowing marks, once again tempered with warnings about small banks and telecomm operators. The utilities picture, meanwhile, remains murkier. The Senate report allows the very real possibility of localized outages, but professes faith that the national electrical grid will continue to function.
Gary Cowles, the country's foremost Y2K watchdog on the grid, is far less sanguine. In an August analysis, he wrote, "Since the day the last National Energy Regulatory Commission report was issued, I've been asked many times if I believe the proclamation that the North American electrical industry is ready to make the century transition. My short answer is that, no, I do not." Since utility deregulation began, he continued, "Maintenance budgets have been slashed.... Fix-on-failure has become the maintenance mode for most equipment.... Personnel downsizing has been endemic.... As shown by two summers' worth of power interruptions and disruptions in the mid-West and mid-Atlantic states (and acknowledged at all levels of industry and government), distribution systems are being strained to the breaking point" [emphasis added].
He concludes: "I think we can reasonably expect that, barring an unforeseen cascade-type event, the power will remain on for a majority of the North American continent. The question then becomes: What percentage of this vast continent remains at risk for power failure? I can't say, and neither can anyone else, because no regional risk studies have been or will be conducted prior to the actual event."
The continued supply of oil, on which so much of the day-to-day working of the country depends, is similarly in doubt. For purposes of a brief sketch, suffice it to point out that the U.S. currently imports 55 percent of its crude oil, and that -- according to figures cited in the Senate report -- over half of its foreign suppliers are deemed to be at high (or altogether unknown) risk of production problems due to Y2K. There is always the U.S.'s much-touted Strategic Petroleum Reserve, but it contains only a two-month supply. As to the broader economy, an August survey by the consulting firm CapGemini America indicated that 48 percent of major U.S. corporations do not expect to finish repairing their "mission- critical" systems by year's end.
But suppose for a moment that the optimists are right about the Iron Triangle. The center holds; neither Jesus nor the extraterrestrials appear in our midst. What then? Perhaps the most cogent portrait of Y2K risk factors is contained in a little-noted essay by Ian Hugo of the U.K.'s Taskforce 2000, an industry group top-heavy with players in Britain's information systems sector. According to Hugo, rollover errors -- the ones triggered by the millennium date change itself -- are just one class of Y2K computer problems, and probably not the most important one.
Rollover errors (and other date-logic troubles) sometimes cause computers to reject data, but more often they simply result in corrupted data that takes much longer to detect. Other Y2K errors cited by Hugo fall into three classes: errors introduced in software remediation (it's estimated that five to 10 percent of code fixes result in new glitches); configuration management errors, which involve software-compatibility problems that arise when a series of programs are revised or replaced in a complex system; and implementation overruns, which speak to the problem of getting new software up and running where replacements have been made -- a process that most organizations did not count as part of their Y2K timeline in the first place.
What all this means, in short, is that most Y2K problems will not manifest themselves over the New Year's weekend, but in a more piecemeal fashion and over a much longer time. The corollary: Most Y2K glitches will not be catastrophic in and of themselves. Their potentially debilitating aspect lies in their cumulative weight, and the difficulty of tracking down the sources of each particular error when multiple, simultaneous failures are occurring. Thus the real question is not when we will fall off the cliff, but when -- and at what rate -- we might begin to travel down the entropy curve.
The answer, according to Hugo and others, is that it should already be happening. Most expert opinion on Y2K has theorized an onset of problems in the second half of 1999. The Gartner Group, a leading Y2K consultant, estimates that 25 percent of Y2K glitches will manifest themselves before the New Year. That so little has been reported to date would seem to augur well. Two caveats, though: First, it takes a certain critical mass of errors before their effects become unmanageable. Second, the absence of widespread Y2K incidents could be bad news rather than good, if it proves a token of how far behind organizations have lagged in testing and implementing their software fixes.
Still, no news would seem to be good news -- domestically, at least. Elsewhere the outlook is dimmer. Appearing before the Senate Y2K committee in July, U.S. State Department Inspector General Jacquelyn Williams-Bridger testified that "the global community is likely to experience varying degrees of Y2K-related failures in every sector, in every region, and at every economic level. As such, the risk of disruption in any part of the global supply chain would have a serious impact on the U.S. and world economies."
Under the measured bureaucratese lies an unsavory prospect. Even if U.S. businesses and government have a relatively easy time of it with their stateside Y2K transition -- unlikely in the extreme, especially when one stops to ponder the thousands of small and medium-sized enterprises (SMEs, in official parlance) that have done nothing to update their computer systems -- there is the international question. Y2K may bring home the global character of the present-day economy far more bitterly than NAFTA ever could. Consider the foreign oil problem. The reliance of U.S. car makers on outsourced parts from around the world. The Asian factories that produce the microchips to power "American" computers. Or the 80 percent of U.S. pharmaceuticals manufactured from imported raw materials. Economic vicissitudes such as these aren't exactly the stuff that movies of the week are made of, but they may seem all too dramatic a few months from now.
