Read this with open mind -http://www.y2ktimebomb.com/Computech/Issues/hyatt9930.htm
Actions Speak Louder Than Words
By Michael S. Hyatt
July 29, 1999
If you think that Y2K has been all but solved, think again. Even the officials
spouting the good news don't really believe it. Forget what they are saying. If
you want to know what they believe, take a look at what they are doing.
I am constantly reminded by the Y2K nay sayers that
government officials, corporate spokespersons, and the
traditional media are all saying that Y2K no longer poses
a significant threat. According to them, organizations --
at least in the United States -- have the problem well
under control and expect to have their mission critical
systems remediated before January 1. They are on
track, making good progress, and confident that the
problem is all but solved. There may be some minor
disruptions, but nothing catastrophic-certainly nothing like what I have
suggested could happen if we don't get a substantial percentage of our
automated systems repaired in time.
The effect of this propaganda -- and that's precisely what it is -- is apathy on
the part of the general public and confusion on the part of the Y2K aware. A
recent survey for the CBS news program "Sunday Morning" found that less
than one-fifth of U.S. households plan to stock up on food or water in
preparation for possible Y2K disruptions. Although most are doing nothing at
the current time, 18 percent of respondents said they were thinking about
storing some supplies later this year. The majority of those surveyed, 56
percent, said that no one in their home was even thinking about doing
anything to prepare for Y2K problems.
Even those who a few short months ago were convinced that Y2K would
adversely affect their lives have begun to second-guess their concerns. I've
heard from hundreds of them. Many are wondering if their preparations
were misguided. A few have even said they feel that they were misled.
Some have asked if they should stop preparing, now that the threat is past.
The amazing thing about this perception is that it is wholly misguided and
based on nothing other than the vague assurances of government and
corporate spokespersons.
Yes, there has been progress -- in a few cases, dramatic progress. But,
over all, the available facts do not support the conclusion that the Y2K
Problem is well in tow, let alone substantially solved. In fact, I would go so
far as to say that those who are telling us it is, do not really believe their own
public rhetoric. Why? Because their actions betray their true perceptions.
Let me give you a few examples.
1.They continue to raise budgets. While companies are publicly saying
that the problem is nearly solved, many are continuing to raise their
budgets. Why? Because Y2K projects are turning out to me more
complex and more expensive than they anticipated. The federal
government initially projected spending $2.3 billion to repair its
computers. It's most recent estimate (June 15, 1999) is a whopping
$8.03 billion -- an increase of 287 percent. The amazing thing about
that is that this is a $1.3 billion more than the government projected
just four months ago!
Corporate Y2K budgets have followed suit. According to a recent
CAP Gemini survey (May 17, 1999), 85 percent (article requires free
registration) of the Fortune 500 companies said that their spending
would have to rise above current estimates. To cite but one example,
in its annual shareholder's report filed in April, retail giant Wal-Mart
reported that it will spend more than twice as much as it previously
expected to solve Y2K-related problems. Other companies such as
Aetna, AT&T, General Motors, McDonald's, Merrill Lynch, Sears, and
Xerox have experienced a similar, dramatic rise in Y2K repair costs.
If Y2K is no big deal, why aren't the budgets going down or at least
leveling off?
2.They are still pushing the deadlines out. Although virtually every
corporation in the United States and Canada promised the public that
they would be finished with their Y2K projects by the end of 1998, as
of June 21, 1999, 92 percent of large companies have not actually
completed the work and one in ten will not finish until well into next
year. Worse, 33 percent admitted to being behind schedule; 35
percent are still waiting for mission-critical software to be delivered by
suppliers. According to the CAP Gemini survey cited earlier, 22
percent (article requires free registration) of the Fortune 500 say they
do not expect to have all their mission critical systems tested and
ready for the new millennium by January 1! If this is true of the largest
companies -- presumably the ones with the most resources to throw
at the problem -- what can we expect from smaller companies?
Every indication is that they are running even further behind. The
federal government has now missed three Y2K deadlines imposed by
the Clinton Administration.
The September 30, 1998 deadline came and went without a single
agency able to claim victory. The deadline was then extended to
December 31, 1998. This time two agencies -- the Social Security
Administration and the Small Business Administration -- met the
deadline. (The U.S. Customs Service (article requires subscription)
and the Health Care and Financing Corporation (HCFA) also claimed
compliance, but these claims were later proven to be bogus.)
The deadline was again extended, this time to March 31, 1999. On
this date, the Administration claimed that 92 percent of the
government's mission critical systems were Y2K-ready. However,
most of this progress was made by simply reducing the scope of the
project -- from some 9,100 mission critical systems in September
1998 to 6,123 systems in March 1999. In addition, the simple fact is
that 11 out of 24 key agencies missed the deadline again, including
some of the most critical: Energy, Treasury, Health and Human
Services, Defense, and Transportation. Worse, of the 43 systems
identified as "high impact" (e.g., Social Security, Air Traffic Control,
and Medicare) by the Office of Management and Budget, only two --
Social Security and the National Weather Service -- were compliant
as of March 31. (The complete list can be found here.) (article
requires Acrobat reader) What was the administration's response?
You guessed it -- extend the deadline to September 30. This, despite
the fact that several agencies are not scheduled to be ready until
December at the earliest.
If Y2K is no big deal, why are so many organizations having chronic
difficulty meeting their deadlines? Why do they keep quietly pushing
them back and why isn't the press calling them to task?
3.They are making contingency plans. According to another survey
conducted by CAP Gemini (May 31, 1999), the vast majority of major
corporations have begun to build crisis management centers from
which they will control damage and coordinate the recovery of
Y2K-stricken technology systems. The survey found that 85 percent
of Fortune 1000 companies now plan to build Y2K command centers,
up from 40 percent in November 1998. In addition, organizations
across the country are canceling vacations from November through
February to make sure their employees are available to address
Y2K-related disruptions.
According to a report issued by the Cranfield School of Management
(The Sunday Times, June 13, 1999) 60 percent of British
corporations are already stockpiling raw materials and finished goods
out of fear of Y2K-related supply interruptions. My guess is that a
similar percentage of U.S. companies are doing the same. Even the
Federal Reserve is stockpiling $50-70 billion in additional cash
reserves.
Whatever else a contingency plan is, it is an admission that things
may go wrong. But if Y2K is all but solved, if it will be no worse than
your typical three-day winter snowstorm, why are so many
organizations going to such lengths to prepare for failure? (By the
way, would someone please explain to me why it is that when
individuals and families make contingency plans it is seen as a form
of panic, but when governments and corporations do so, it is seen as
simple common sense?)
4.They are passing legislation to limit Y2K litigation. When I first began
doing research on Y2K, the GartnerGroup, Giga Information Group,
and others were estimating that litigation stemming from unresolved
Y2K problems could approach $1 trillion. (Just to put that amount in
perspective, that is one-seventh of the annual U.S. economic output.
It is equivalent to the entire U.S. healthcare industry.) According to
USA Today, "Litigation resulting from Year 2000 meltdowns will be
more costly than asbestos, breast implant and Superfund cleanup
lawsuits combined."
The first Y2K lawsuit was filed in August 1997. By the end of 1998,
ten more lawsuits had been filed. Soon, the trickle was threatening to
turn into a flood. As of March 1999, a total of eighty lawsuits had been
filed along with 790 "demand letters" (the step in the litigation process
that comes prior to filing a lawsuit). Almost immediately, the Senate
Judiciary Committee voted 10-to-7 to limit lawsuits against high-tech
companies stemming from Y2K malfunctions. By June, the Senate
had passed the Y2K liability bill. On July 1, the House passed the
same bill, and on July 20, President Clinton (article requires
subscription) signed the bill into law. The new legislation is aimed at
limiting frivolous lawsuits by setting a ceiling on punitive damages,
narrowing the guidelines for class-action suits, and ensuring that
defendants will be held liable only for the share of any damages that
they cause.
But here's the question: why are they so concerned about mounting
litigation? If Y2K is all but solved, there will be few failures, right? If
there are few failures, there won't be many lawsuits, right? You would
think so, but obviously the President and Congress are expecting
something different -- something contrary to what they are stating
publicly.
5.They are even preparing for martial law. Even though I get asked
about this subject wherever I go, I have studiously tried to avoid
discussing it. It's always sounded to me like something that only
conspiracy theorists take seriously.
Initially, it was hard for me to admit that the government might be
saying one thing and doing another. But, as I've watched Y2K unfold,
I've gradually become more and more convinced that they are doing
exactly that. As I testified before Congress in September 1998:
"I have detected a disturbing attitude in Washington and
elsewhere as I have traveled the country. There are those who,
if not saying it directly, are acting as if the people cannot be
trusted with 'dangerous information.' This attitude betrays a
fundamental presupposition about our citizens that I do not
share: that is, if people know the truth they will act irrationally
and without concern for their neighbors. While this may be true
in isolated incidents, it is not true of our people as a whole, as
any cursory reading of our history will show."
Now the handwriting is clearly on the wall.
The London Sunday Times reported that the British
government has drawn up secret plans to use elite special
forces to deal with Y2K disruptions when January 1 arrives.
Code-named "Operation Surety," the plans call for members of
the SAS -- comparable to the U.S. military's Army Rangers or
Navy Seals -- to protect not only key government sites, but also
civilian installations such as banks, airports, and power stations
if civil unrest becomes widespread. You can bet that if they are
doing this in Great Britain, they are doing it in the other NATO
nations as well.
The Washington Post reported that a contingent of Marines
based in Washington D.C. recently trained in Quantico,
Virginia, to hone its skills in dealing with civil unrest. In the mock
scenario, an angry mob of disgruntled federal workers had not
received their paychecks because of Y2K computer problems
and were storming government buildings. Equipped with riot
shields and concertina wire, the Marines practiced various
techniques for controlling the crowds.
According to Federal Computer Week, "the Defense
Department has instructed all military commanders to maintain
their units' ability to go to war in the event of widespread Year
2000-related critical infrastructure failures, relegating local
community assistance to the bottom of the department's
priority list. Local commanders at military installations across
the United States and abroad will be authorized to 'undertake
immediate, unilateral, emergency response actions that involve
measures to save lives, prevent human suffering or mitigate
great property damage' in the event of catastrophic
infrastructure failures, according to a recent memorandum
signed by deputy secretary of Defense John Hamre.
These examples do not even include the myriad reports I am getting from
private citizens and military personnel about urban assault training, the
erection of convoy signs on Interstates, special Y2K operating procedures,
and the re-opening of military bases that have been closed since World
War II. Some of these reports may, in fact, be bogus, but I can tell you the
volume has increased substantially and some of them are coming from
sources I trust.
Think about this: if there aren't going to be significant problems, why would
the military be anticipating civil unrest and "critical infrastructure failures"?
Why would they be engaged in such comprehensive mobilization
exercises? Why would the Deputy Secretary of Defense be instructing all
military commanders to be prepared for a situation that can only be
described as something akin to war?
The bottom line is this: forget what you are hearing in the mainstream
media. Forget the happy-face notices you are receiving in the mail from
your suppliers and from government officials. If these spin doctors really
believed that Y2K has been substantially solved, they would not be doing
what they are doing. Specifically, they would not continue to raise budgets,
push the deadlines out, make contingency plans, pass legislation to limit
Y2K litigation, and prepare for martial law. But they are, and in doing so,
they betray their true colors.
Again, forget what they are saying, and watch what they are doing. Like your
Momma used to say, "actions speak louder than words." |
