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business equipment in 1,550 corporate and regional service facili- with the Federal Aviation Administration. ties. State Farm still has 100 employees working "around the ¢ Taxpayers may not receive timely tax refunds because the IRS clock" on nothing but Y2K." may be unable to process their tax returns. But even a forward-looking company like State Farm could be and retirees may be delayed or disrupted harmed by this problem if its customers, suppliers, partners, by the failure of mission-critical systems supporting the nation's bankers and regulators aren't compliant by the year 2000. As benefit payments systems (i.e., people may not receive their social Merrill Lynch says: "Even institutions that have fixed their own security or disability checks in a timely fashion). internal problem will feel the ripple effects from problems occur- GAO reported on June 10 that 24 government agencies are only m2 ring externally. 40 per cent of the way towards their goal of Y2K compliance." A survey of small businesses by the National Federation of GAO said it had published 40 reports on government computers Independent Businesses (NFIB) reported on June 1| that 75 per during the past two years: "The common theme has been that cent of small businesses have done nothing about the Y2K prob- serious vulnerabilities remain in addressing the federal govern- lem. The NFIB estimates that 330,000 small businesses will go ment's Year 2000 readiness, and that much more action is needed bankrupt and another 370,000 will be "temporarily crippled" by to ensure that federal agencies satisfactorily mitigate Year 2000 the Y2K problem.'* risks to avoid debilitating consequences." GAO concluded: "As a Conclusion No. 2: Portions of the nation's basic infrastructure result of federal agencies’ slow progress, the public faces the risk (utilities, transportation, defence, manufacturing) seem likely to that critical services could be severely disrupted by the Year 2000 be disrupted by the Y2K problem. Furthermore, parts of the computing crisis." world's core commercial institutions, such as banking and insur- No one knows what will happen as we approach the year 2000. ance, also seem likely to be disrupted. We do know that many manufacturing processes are dependent upon computers, especially in the chemical processing indus- "If we don't fix the tries. The Fortune report said: "The preci- century-date problem, sion and interdependence of process controls in chemical plants, for instance, make a we wi ll have a Rube Goldberg fantasy contraption look sim- ple. Let a single temperature sensor in the situation scarier than | compte chain of measuring instruments go the average disaster Bh svaveun scr a vrocect with dttercet movie you might see ingredients than you need—if it comes on a Sunday night." ANTICIPATED EFFECTS f the disruptions don't begin on January 1, 1999, they may begin on July 1, 1999 when fiscal year 2000 begins for 46 out of the 50 states, or on October 1, 1999 when fiscal year 2000 begins for the federal gov- ernment. But most of the problems will probably surface after midnight on December 31, 1999. Charles Rossetti, commissioner of the US Internal Revenue Service (IRS), told the Wall Street Journal in late April that Y2K is a "very, very serious problem". "There's no point in sugar-coating the problem," he said. "If we don't fix the century-date problem, we will have a sit- uation scarier than the average disaster movie you might see on a Sunday night. Twenty-one months from now, there could be 90 million taxpayers who won't out at all."” Even the nation's defence apparatus could be adversely affected. The GAO reported on June 30 that the US Navy is far behind in fixing its Y2K problems, and concluded: "Failure to address the year 2000 problem in time could severely degrade or disrupt the Navy's day-to-day and, more importantly, mission-critical operations." GAO said the navy doesn't — Charles Rossetti, commissioner of the US Internal Revenue Service (IRS) get their refunds, and 95 per cent of the revenue stream of the even know how many of its computers have Y2K problems, so it United States could be jeopardized.""* Mr Rossetti went on to say _ doesn't know how big the task ahead may be.” he is confident that these problems will not occur because IRS Why is this seemingly simple problem so difficult? Merrill computer experts will prevent them. Critics of IRS are not so Lynch, the financial management firm, says there are four rea- sure.!° sons:”! The deadline for having everything fixed—December 31, 1. Pervasiveness. Computers that depend on dates are present 1999—is just over 500 days away, and it is an unusual kind of in every kind of technology—manufacturing systems, medical deadline because it cannot be ignored or extended. equipment, elevators, telephone switches, satellites and even auto- Fortune magazine (April 27) reported that, on average, large mobiles. corporations are only 34 per cent of the way through the job of 2. Interdependence. Computers exchange information among making their systems compliant." themselves. "A single uncorrected system can easily spread cor- Government agencies are doing only slightly better. The rupted data throughout an organization and even affect external Government Accounting Office (GAO) stated in March 1998: institutions," Merrill Lynch says. "Time is running out for solving the Year 2000 problem. Many 3. Inconsistency. Computer languages do not store and use federal agencies will not be able to renovate and fully test all of dates in a consistent way. Dates are labelled, stored and used in their mission-critical systems and may face major disruptions in different ways from program to program and even within a single their operations. At the same time, systems that have been reno- program. Therefore, identifying and correcting dates requires vated and tested may encounter unanticipated Year 2000 prob- close inspection of the computer code line by line. lems." 4. Size. Most large corporations and government agencies use The GAO gave examples of what may go wrong: thousands of programs containing millions of lines of computer ¢ The nation's air transportation may face major delays and dis- code. Each line of code must be inspected manually and, if neces- ruptions because the airlines may not be able to file flight plans sary, fixed. movie you might see on a Sunday night." NEXUS © 15 "If we don't fix the the average disaster AUGUST - SEPTEMBER 1998