Caspar Weinberger Commentary on "The Y2K Crisis"
Chairman of FORBES Magazine and Ex-Secretary of Defense
FORBES - April 20, 1998
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It is widely known that most computers will have serious problems after midnight, Dec. 31, 1999, because most of them, if the software is not fixed, use two-digit dating systems that report the "00" of the year 2000 (Y2K) as 1900.
The chaos that could ensue has been reasonably well documented. It could result in insurance companies being told they should use premiums for policyholders who are "age minus 23 years." It could disrupt air- traffic control systems that keep planes safely separated, records of tax payments, IRS tax refunds, elevator-maintenance scheduling that keeps elevators running, issuance of Social Security and other government checks, and bank loan payments. Many more things could go awry if thousands of software programs with millions, possibly billions, of lines of code are not rewritten so that "00" is recognized as 2000.
The world is heavily dependent on software for computers. An average- size company may use hundreds of programs; the Department of Defense uses thousands, as well as about 600,000 embedded chips, many of which require date correction. Estimates of the cost of averting this catastrophe worldwide range from $300 billion to $600 billion. Projected costs for the U.S. government alone have ballooned from $2.3 billion in February 1997, to $4.7 billion a year later, and there are even estimates that U.S. taxpayers ultimately will pay $10 billion. It is all reminiscent of the savings and loan debacle of a few years ago.
Money is not the sole measure of the damage. Only about 20 months remain to complete all the fixes, and, despite claims by various software companies, most of the billions of lines of code will have to be corrected manually, with there being a desperate shortage of programmers.
Congressional committees were told recently that only about 35% of the more critically important federal government systems have been fixed. The committees were also told by the General Accounting Office that it is unlikely that even the remaining 5,000 "mission- critical" systems can be corrected in time.
And, of course, with the interdependence of so many programs and systems, those 5,000 essential systems that are priority fixes may be multiplied exponentially. There are about 60,000 "non-mission-critical" federal systems that also need saving. Defense is not expected to be finished with the needed repairs on its existing "mission-critical" systems until 2009.
And what will be the end result of all this? As with the savings and loan mess, we will have nothing more than what we had all along. "This is money spent primarily to stand still," said the
government's "year 2000 czar," John Koskinen.
The worst of all the cataclysmic effects of the Y2K problem is that we will need all the available skilled manpower we have (with more, hastily recruited) to do the fixing. So the vast talents here and abroad that have been used to create all of our computer wizardry will be put to far more mundane tasks.
Thousands of companies that have been planning to upgrade and improve all their systems in the next few years will have no money to do so. And software companies that had counted on continued exponential growth will have neither the manpower nor the new programs to sell to produce that type of growth for several years.
WHAT MUST BE DONE?
We need to recognize the magnitude of this problem, the cost of not fixing it, and the need for most businesses, large and small, to assign the highest priority to Y2K. If we do so in the next 20 months, American skill, ingenuity and production genius may be able to avoid the worst.
Sadly, however, most companies and government agencies are still only surveying the problem, making inventories of what needs to be done and merely talking about it when the problem cries out for action now.
Caspar Weinberber, FORBES Chairman and Ex-Secretary of Defense
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