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NHNE Y2K Report 19
Sunday, March 21, 1999


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NHNE Y2K Report 19
Sunday, March 21, 1999

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UK Finance Firms Risk Y2K Shut-down
Yardeni Sets the Record Straight
Space Storms Could Be Bigger Than Y2K
Marines Train to Deal with Unpaid Government Workers
State Department Considers Y2K Plans for Americans Abroad
Maine Bill Seeks to Stockpile Three Months of Food
Dow Breaks Through 10,000 Barrier
NSW Planning to Shut Down Nuclear Reactor
U.S. Seventh Fleet Finishes Y2K Inventory
New Hampshire Credit Union First to Offer Year 2000 Loans
Trusting In Technology


The Oxford Health Scenario


My Hat's Off to You
Funding Needed for Two Good Y2K Projects


The Beggars of Y2K
The Closest Thing to A "Y2K Movement" Magazine
Changing Y2K Attitudes & Patterns
Cowels Expects Serious Problems With Power
The Plot Thickens With NERC's April 9th Test
Empty Promises
Y2K Confusion In the FAA
The True Meaning of Congressman Horn's Grades
Chemical Safety Board Concerned About Impact of Y2K
"Know Your Customer" Legislation Dealt Potentially Fatal Blow


Senate Y2K Report Now Available In Non-PDF Format
GSA Launches "Community Guide to Y2K"
Directory of Local Y2K Community Preparedness Groups
Wired Publishes Four Excellent Y2K Articles


Y2K Bug Could Make Uganda World's Richest Nation




"More than 30 million people in the U.S. are likely to be without water after January 2000. Nearly two thirds of those affected will be in the big cities. This bleak assessment was delivered during an American-Canadian meeting held on February 22, 1999 to discuss 'Cross-Border Y2K Issues.' At the meeting it was revealed that 10 percent of large urban water suppliers in the U.S. are not expected to be Y2K compliant when the Year 2000 date transition occurs."

--- Jim Lord, March 22, 1999, "Federal Government Figures Project Y2K Water Crisis"



(Source: Clelia Oziel, REUTERS, 3/17/1999)

Major financial firms in Britain may be forced to wind down operations, warned the FINANCIAL SERVICES AUTHORITY (FSA), because they haven't yet met their Year 2000 compliance. "In the last resort and where it is apparent there is no better way to protect depositors, investors, policy holders, or the integrity of markets, we will take action to restrict a firm's business or in extreme cases to remove its authorization altogether," said Michael Foot, Managing Director of Financial Supervision at the financial watchdog. Twelve suspect firms were selected out of a total 160 (7.5 percent) classified as "high impact" -- whose failure to comply would have serious consequences for retail customers or the markets. The high-impact group includes retail and investment banks, insurance companies and building societies. The FSA, which has wide regulatory powers to police Britain's financial services sector, has allocated traffic lights -- "blue" for on track, "amber" for behind, but likely to get on track, "red" for non-compliant -- based on the companies' self-assessment. According to a snapshot of figures from the end of 1998, 58 percent of the high-impact group were "blue" and 35 percent "amber," and 7 percent "red;" in the medium-impact group, 40 percent were "blue," 45 percent "amber" and 15 percent "red." "Green" would be awarded to firms that are millennium compliant, but so far none have earned that color. Foot did not give a specific deadline for initiating legal action, but said it would be "towards the end of the year." (JG)

Link: http://infoseek.go.com/Content?arn=a1526LBY955reulb-


(Source: Ed Yardini, GARY NORTH'S Y2K LINKS AND FORUMS, 3/15/1999)

A recent story in the LOS ANGELES TIMES reported, "Edward Yardeni, chief economist for the investment banking firm DEUTSCHE BANK SECURITIES INC. and one of the most persistent drumbeaters on the Y2K issue, recently revised his estimate for a long global recession due to the glitch, from a 70 percent chance to 45 percent. 'I've toned down the message partly because progress has been made,' Yardeni is alleged to have said. 'I would be happy to back off entirely.' However, according to a March 14th post that Yardeni sent out to his mailing list, this report is in error: "I still see a 70 percent chance of a global recession," said Yardini. "I would be more than happy to turn less pessimistic -- and I will do so -- if I believe the available data warrants such a change. My aim last year was to raise awareness and alarm to stimulate greater efforts to fix the problem. This year, my goal is to promote contingency planning to minimize Y2K disruptions. I tend to agree with my friend Peter de Jager, who believes that doomsday will be avoided....Nevertheless, I doubt a serious recession will be avoided." (JG)

Original LA TIMES article: http://www.latimes.com/HOME/BUSINESS/UPDATES/lat_y2k990312.htm

Ed Yardini's Home Page:


(Source: REUTERS via MSNBC, 3/18/1999)

"Solar flares could do damage far beyond anything the Year 2000 could do, and it could hit us on that weekend," said Michael Lewis, the deputy chief executive of BRITAIN'S ASSOCIATION OF PAYMENTS AND CLEARING SYSTEMS. The last peak in the 11-year cycle of solar flares was in March 1989, when surge of atmospheric magnetic activity shut down the HYDRO QUEBEC power grid in Canada, leaving 6 million people without power for days. Lewis, who is helping coordinate the British banking system's Y2K response, said the dangers of solar flare activity happening in tandem with the Y2K computer problem could not be ignored. Lewis said communications and power failures caused by solar flares could compound a loss of public confidence in communications and computer systems just when it was most needed -- around the millennium. (DS)

Link: http://www.msnbc.com/news/251370.asp


(Source: Steve Vogel, WASHINGTON POST, 3/18/199)

Will government workers riot if they're not paid because of Y2K computer problems? Not if the Marines can help it. A story in the WASHINGTON POST reports that Marines will be ready if mobs of office workers armed with staplers and briefcases storm the Treasury. A contingent from the Marine Corps Barracks in Southeast Washington traveled to Quantico Marine Corps Base in Virginia recently to train for handling civil unrest. The scenario, played out at a mock training city at Quantico, involved government workers miffed that computer problems associated with the year 2000 computer problem are preventing paychecks from being issued. The Marines, equipped with riot shields and concertina wire, were able to save the republic from the marauding workers -- at least in this practice run. (DS)

Link: http://www.washingtonpost.com/wp-srv/WPlate/1999-03/18/141l-031899-idx.h


(Source: Adam Entous, REUTERS, 3/5/1999)

The U.S. STATE DEPARTMENT has announced it is considering travel warnings and evacuation plans to safeguard Americans abroad because Year 2000 glitches could cause trouble for computers running power, transportation and telephone systems. The Y2K responses of many governments around the world are "inadequate, belated, and uneven," says Bonnie Cohen, the State Department's Undersecretary for Management. Jacquelyn Williams-Bridgers, Inspector General at the State Department, cites examples such as the potential failure of telephone systems in Russia and the power grid in the Ukraine, and the disruption of ship traffic through the Panama and Suez Canals. "Based on these analyses, the State Department will determine whether it needs to issue travel warnings concerning particular countries or develop drawdown or evacuation plans for areas where the Y2K problem may pose a risk to Americans living abroad," Williams-Bridgers said. (JG)

Link: http://nt.excite.com/news/r/990305/14/millennium-usa


(Source: Glenn Adams, ASSOCIATED PRESS, 03/19/1999, thanks to Sherry Stultz)

State. Rep. Belinda Gerry is nervous about what could happen if the Year 2000 computer bug turns out to be more troublesome than many expect. That's why the independent lawmaker and several others want the State of Maine to stockpile food. "No one knows what's really going to happen, and I think we ought to be prepared," said Gerry. "I want to stop runs on stores...for the safety of the state." The bill she's sponsoring directs the state to stockpile three months of rice, beans and other food with a long shelf life, at a cost of $50 million. Gerry said she hopes her bill will send a message to the public that it should be prepared just in case the Y2K problem is worse than the State administration and others say it will be. Gov. Angus King, who recently launched a task force to help prepare Mainers for Y2K problems, believes Gerry's bill is unnecessary and feeds into a panic-buying mentality, says spokesman, Dennis Bailey, who adds that King would "definitely consider a veto" if Gerry's bill reaches his desk. "It reinforces the idea there's going to be widespread chaos when in reality it will be more of a nuisance." (JG)

Link: http://www.fosters.com/news99a/march/19/me0319a.htm


(Sources: WIRED NEWS/REUTERS, 3/17/1999; David O'Daniel Eddy, WESTERGAARD YEAR 2000, 3/17/1999)

The DOW JONES INDUSTRIAL AVERAGE has broken through the 10,000 mark (D10K) for the first time. On March 16, at 9:50 a.m. New York time, the Dow stood at 10,001.12, up 41.35 points from the previous day's close. So far, worries of widespread computer glitches haven't panned out. Investors had feared that systems designed to handle only the four digits up to 9,999 might read the fifth digit in 10,000 incorrectly, either freezing systems or triggering automatic sell programs. After falling below 7,500 in October, the market surged to D10K in a little over five months with no apparent glitches. Y2K analyst David O'Daniel Eddy warns being lulled into a false sense of security by comparing D10K with Y2K: "What I read into Wall Street's snide comparison of Y2K and D10K is that they have decided to completely ignore the potential impact Y2K may have outside the cozy financial industry. On top of that, date math is quite complex and easy to get wrong. Y2K is very real and very dangerous." (JG)

Link: http://www.y2ktimebomb.com/Techcorner/DE/de9911.htm

Link: http://www.wired.com/news/news/email/explode-infobeat/business/story/18496.html


(Source: SYDNEY MORNING HERALD, 3/15/1999)

The Lucas Heights nuclear reactor in New South Wales (NSW), Australia will be shut down before midnight on New Year's Eve unless the State Government can ensure that the millennium bug will not disrupt its essential electricity and water supplies, according to a spokesman for the AUSTRALIAN NUCLEAR SCIENCE AND TECHNOLOGY ORGANIZATION (ANSTO). These basic state-run services have been reluctant to report progress and guarantees in tackling Y2K to the satisfaction of the NSW State Government -- and other state governments around the country. Last December, the Federal, State and Territory governments agreed in principal to disclose quarterly reports on Y2K readiness for their agencies, but this has now been put off until at least April 9. ANSTO does not expect to be able to get specific guarantees of continuity of supply of electricity, water and communications for the night of December 31, and as a result is already making plans to shut the reactor down before midnight. (JG)

Link: http://www.smh.com.au/news/9903/15/national/national4.html


(Source: Michael Perry, REUTERS, 3/8/1999)

The U.S. SEVENTH FLEET, America's biggest deployed naval fleet consisting of 60 ships, 350 aircraft and 60,000 navy and marine corps, has finished its Y2K inventory of equipment on every ship and is now proceeding with dockside testing before the entire fleet undergoes Y2K sea trials in September, according to Commander Vice Admiral Walter Doran. The fleet patrols the Pacific and Indian Oceans. When asked about how Asian defense forces were handling the Y2K problem, he responded. "The inter-operability question is on all of our minds, so it really isn't that helpful for the U.S. Navy if we get to a point where we are very good, but all we can do is talk to ourselves." Y2K analyst Gary North points out: "The inventory phase constitutes about one percent of a Y2K repair." (JG)

Link: http://dailynews.yahoo.com/headlines/tc/story.html?s=v/nm/19990308/tc/usay2k_5.html


(Source: Paul Gentilecu, CREDIT UNION TIMES, 2/17/1999)

The nation's first credit union has pulled off another first: St. Mary's Bank in New Hampshire has become the first credit union (CU) in the nation to offer loans geared at helping its business members fund their Year 2000 compliance efforts. The Y2K loans, which could be up to $1.5 million, are limited to the credit union's 250 business members who have been members prior to Sept. 1, 1998, in order to avoid an influx of new membership applications from business owners solely looking to take advantage of the new service. Applicants will have to go through St. Mary's standard underwriting procedures and all Y2K loans will be secured by collateral as required by St. Mary's business lending policy; however, the credit union is waiving all fees associated with the loans. St. Mary's says it is in the fortunate position to offer Year 2000 loans because its own Y2K compliance efforts are in order. (JG)

Link: http://www.cutimes.com/y2k/1999/yr021799-1.html


(Source: Tom Weber, BANGOR DAILY NEWS, 3/6/1999)

According to a recent survey of New Englanders, lower-income people fear the effects of the Y2K computer bug more than their more affluent, better-educated neighbors. People with more money and schooling appear more likely to trust technology and downplay the severity of its glitches, while the heightened degree of anxiety might be due to "inexperience with technology, or skepticism about government or large institutions," speculates UNIVERSITY OF MASSACHUSETTS Professor Ralph Whitehead Jr. Yet, the closer we get to this mysterious day of reckoning, the clearer it becomes that no one, regardless of education or money, can say precisely what will happen when computer clocks around the world click over to "00." Tom Weber, columnist with the BANGOR DAILY NEWS, comments: "It's awfully frustrating to think that such a highly-educated, technologically-advanced society like ours could find itself staring into space like the primitives, hoping for miracles." (JG)

Link: http://www.bangornews.com/News/3699AsY2Kdisas.htm




Programmer Cory Hamasaki, publisher of THE DC Y2K WEATHER REPORT, has been searching for concrete examples of the kind of Y2K failures he believes our world will soon be experiencing in mass. In his March 3 report, Hamasaki believes he found one. What follows are excerpts from Hamasaki's report:

"I've been looking for a concrete example that will explain why SHMUEL, INFOMAGIC, Bill Hoyt, Ed Yourdon, Steve Heller, and others are worried about Y2K. At the last WDC Y2K representatives from several law firms spoke and one of them cited an excellent example..."

"According to the lawyers and news clippings, Oxford attempted to switch database systems in midstream. The technical details are sketchy but they had software problems for a year that involved losing transactions, not issuing bills, failing to pay the docs for services, and other accounting errors.

"Some denialists like to pretend that any system can be fixed in, oh, three hours, maybe a half day on the outside. Oxford flubbed around for a year. In fact, there seemed long periods of time, weeks or months, during which Oxford thought its systems were working, but they weren't.

"Litigation, bankruptcy, people sucking lemons to make faces at each other. Oxford's stock price collapsed, jobs were lost, and somewhere in all that, there was certainly at least one person who said, 'Ah, this lumpy-bumpy in my special body part, I'll put off getting it checked out until my insurance is working again.'

"Say this to yourself, read it out loud if necessary, everything else was working; the power was on; telcos, fuel, no programmer crisis but still the IT shop at Oxford was in paralysis for a year.

"Please denialist butt-heads, don't argue with me. Tell the people who lost money, lost insurance coverage, lost their jobs, and maybe lost a loved one, that the Oxford insurance problem was just hype, a trick by consultants to grab for the bucks..."

"The problems at PHYCOR and Oxford are not Y2K. These examples are metaphors for what will unfold over the next few years. The coverup will continue as it did at Oxford. The PR department will spin the stories. They'll pretend until it is not possible to cover up any longer.

"The Oxford coverup, or was it just that management didn't know; yes they suspected, heard rumors, but they didn't believe them, how could they have known. Whatever happened, went on for a year. The time frame was 1996 and 1997.

"If the Oxford model holds, then the Jo Anne Effect failures will surface toward the end of 1999. If the Oxford model holds, the IT shop failures will tank a large percentage of the large corporations.

"So what does this mean to you?

"It means that the large enterprises will PhyCor or Oxford you sometime toward the end of 1999 and certainly by 2000. Take precautions, prepare, have a Plan B and Plan C."

Link: http://www.kiyoinc.com/WRP113.HTM




"I read NHNE habitually until it got the Y2K bug. As a computer programmer by trade, you might guess I seek other fare for relaxation. I suspect the danger is a bit overblown, but, certainly, it is reduced by the work of the whistleblowers. My hat's off to you!"

--- Tobey Llop, East Amherst, New York



"There are two significant Y2K projects currently stalling for lack of funds:

1. "Catalyst For Change: Visionaries Talk About Y2K," an excellent 19-minute video containing excerpts of dialogues with leading visionaries and Y2K leaders such as Barbara Marx Hubbard, Peter Russell, and Meg Wheatley, in response to the question: "What is the impact of Y2K on the evolution of human consciousness, and how can people best prepare?"

2. The spectacular two-sided "Y2K Wakeup Map" by SUNSHIP PUBLISHING that shows the global situation in a graphically-powerful way.

Both the video and map have been produced but they need financial help to promote and distribute them, and to support other related projects. Does anyone have information on granting institutions that are capable and willing to move quickly on Y2K? If so, please contact me at: 'bluespin@earthlink.net'."

--- Scott Hess, Petaluma, California



(Source: Larry Shook, personal correspondence, 3/12/1999)

The following are edited excerpts from an essay about the weakness of our society's response to Y2K, by Larry Shook, co-author/editor of "Awakening: The Upside of Y2K":

"The American infantry in Vietnam had a desperation tactic called 'Deathcon.' Units that were about to be overrun would sometimes call artillery or airstrikes in on themselves. They'd dig in as much as they could, then call down the fire. The other day, deep in thought about this amazingly strange Y2K business, the word 'Deathcon' popped into my mind. It made me wonder: Is that what we're doing here? Could Y2K be some desperate gesture of the collective unconscious? Is some portion of our psyches crying out for help?"

"I think of the materialism that has so quietly overrun us. How did it happen? Where did it come from? Whatever can we do to free ourselves of the illusion that the economy is what feeds us? I think of the corporations that have occupied our nation and world. Their murderous disregard of people and the earth. Their contempt for the social contract. The sanction given to them by the courts. I think of the CIA, my money, my votes, my soul, hunting down Mayan Indians. And then I think of Y2K and wonder: Is this really an accident? Is there some collective intent here? Could there really be that kind of mystery in the universe?"

"I think of the young platoon leaders and squad leaders who called for 'Deathcon.' Some of those young men, in dark moments before my eyes, did things that scalded me with the image of the kind of love and generosity humans are capable of. And now I think that what they did also involved a kind of begging, begging us to remember the testament of their acts."

"I wonder if that's not what we're all doing now, together, with Y2K: begging one another to wake up, to remember who and where we are? I have become a loud beggar: Begging the President and Congress to remind us of what we really hold dear, begging them to please lead our nation through this. Begging the media to report the truth of this story so that it can bring out the best in us. Begging us all to not be afraid, to not look away, to accept the gift."

"I think of something Kent Hoffman referred to in his beautiful essay, 'Ask': 'The heart is a beggar. Petition and supplication are its natural modes. Begging comes from need. If you know your need, if you do not shut your eyes to the truest longings of your heart, you will know where to take your petitions....Only your heart will lead you to God'"

"Tom Atlee has been asking, 'Where is the juice of Y2K?' For me it is here." (JG)


(Source: Tom Atlee, THE CO-INTELLIGENCE INSTITUTE, 3/14/1999)

The following are some edited excerpts from the personal correspondence of Y2K analyst Tom Atlee:

"I've noticed I don't have enthusiasm for the vast majority of publications (including books) on Y2K. Even when they're good. Even when they espouse the things I believe in. Even when they publish my articles! I decided it's because I'm addicted to email and the Web. The speed, volume and up to dateness of the online world makes the print world seem uninteresting to me -- ESPECIALLY when it has to do with Y2K."

"[However,] the vast majority of people are not on line. Video and books are good for basics, but can't keep up with the unfolding Y2K scene. And [since] we don't have access to much mass-audience TV, they need to be reached by print media and radio. If Y2K leaders and organizers neglect the magazine and radio worlds, we effectively abandon the very people we are supposed to be organizing and informing.

"I think we need to create and support our own print media and radio programs, which can support our work in the world. [For example,] in the case of the new, very good, Y2K SOLUTIONS magazine, this would mean subscribing to it ($2/mo), making sure it is at every Y2K meeting (bulk $1 each, for 25+), encouraging people to subscribe to it, promoting it when we speak in public forums, and supporting it with articles, suggestions and news of our activities. We could even order gift subscriptions for public figures and journalists."

Y2K SOLUTIONS publishers, Mikaela Rierson and Jim Ricker, would like to send you a packet of their premiere issues to peruse and also to hand out (all they need is your mailing address). In addition they ask for assistance in the following areas:

- contact names, addresses, emails, phone numbers of community leaders;

- literature, brochures, stories, so that they can know what's happening out there and report it in the magazine;

- newsstand placement referrals;

- media coverage;

- Internet page link. (JG)

9121 E. Tanque Verde Road, #105-313
Tucson, AZ 85749

Phone: 520-749-7790
Fax: 520-749-4479
eMail: aware@azstarnet.com

Y2K Solutions Magazine Website:


(Source: Robert Theobald, personal correspondence, March 1999)

Here are some edited excerpts from an essay by futurist Robert Theobald about the confused feelings some people are having over Y2K, and the need to look at the broader issues:

"The initial Y2K issue was how much we could fix the bug. The hope was that it would be possible to limit the damage so that there would be, at worst, a bump in the road. Then it became obvious that there was a need for preparedness. The model that developed proposed that people should stock food and water for a given number of days. There were also suggestions for preparing for interruptions in energy and money supply, etc. This fell easily into parallels with disaster preparation [and] assumed that there would be a short period of major disruption and that realities would then go back to their previous shape."

"It seems to me, however, that the debate has moved on. While there may be short-run dangers, the real issues are far more complex. The overall industrial system is dangerously stressed [and] if things do go wrong, breakdowns will take place and damage the infrastructure on which we have come to rely, in unexpected and unpredictable ways."

"At the present time, it seems to me that we are in danger of 'Y2K fatigue,' as people are whiplashed by contradictory experiences. I am convinced that we need to help them to see that there is an overall set of responses which is relevant and which we have aimed to evoke by the term 'resilience.' People will only see the need for resilience if they tackle the Y2K crisis at a deeper level where they understand that it is challenging the core of the beliefs that we have used to shape our realities in the 20th century [and that we] are being forced to develop a new set of understandings and beliefs."

"Y2K is indeed a catalyst and an opportunity, but it cannot operate in this way unless we enable people to approach it from a values and spiritual base. In specific terms, this means that we must affirm the need for preparedness, as there will necessarily be times when families and neighborhoods will need to support themselves. But preparedness is not particularly a Y2K issue. It is part of the needed shift to recognize that mistakes are part of life and are learning potentials, but only if they are admitted rather than denied."

"The real challenge is to see Y2K as the forerunner of massive changes in the 21st century. Our future goals must be quite different than those of the past. Human survival requires a profound shift from a quantity-of-goods to a quality-of-life orientation. It demands that we commit to social cohesion, ecological integrity and effective decision-making. It demands that we live on the basis of positive values. It requires that we move from mechanical to organic metaphors."

To gain further perspective, Theobald suggests that you check out <www.resilientcommunities.org>, and if you are based in North America, consider getting involved in the April 8 satellite videoconference on resilient communities (details in Y2K Report 18).

Link: http://www.transform.org/transform/tlc/rtpage.html


BY David Sunfellow

Rick Cowles is one of the leading experts on Y2K and the power industry in the U.S. He is also a popular speaker, Congressional Y2K expert, the force behind the Internet's most well-known Y2K energy website ("Electric Utilities and the Year 2000" <http://www.euy2k.com/>), and the author of "Electric Utilities and Y2K," as well as the host of a new video, "Zapped: A Household Primer for Dealing with Long Power Outages," which teaches people how to prepare for power outages beyond Y2K.

In a January interview with Drew Parkhill of the CHRISTIAN BROADCASTING NETWORK (CBN), Cowles predicted a Bell Curve power failure of 15-70-15 (15% of U.S. power companies will fail, 70% will experience problems, 15% will become Y2K compliant).

Said Cowles, "If you asked me to try to nail down a timeline, strictly off the top of my head, I'd say two weeks after 01/01/2000, and then you'll see a slow recovery for 15 or 30 days to some kind of equilibrium where you've at least got some degree of reliability just about everywhere... You're going to see isolated dark spots here and there. You're going to see brown spots here and there. But you're going to see more light spots than brown or black spots."

On February 26th, Cowles spoke at Y2KWise in Maryland. Cory Hamasaki, author of the DC Y2K Weather Report, spoke with Cowles after the event and reported on his conversation in the March 3rd issue of his report. Writes Hamasaki:

"After the meeting, I spoke with Rick, got his private assessment. Here's the DC Y2K Weather Report confidential word from Rick:

"1. Expect serious problems with power for about a month. No guarantees one way or the other but prepare for blackouts, brownouts, rolling blackouts, voltage spikes, and other problems.

"2. For about a year, the power will be unstable. There might be occasional outages, dirty power, your refrigerator might blow up, more black outs but not as frequent as in the first month.

"3. Some places will have more problems than others. (Do you feel lucky today? Well, do you?)

"I got the impression that it would be like power in a third world country.

"Rick reiterated that the Peach Bottom 2 nuclear plant lost monitoring systems doing Y2K testing, this is a safety problem, and SURPRISE! the production systems failed too.

"But then, a few days later, NRC's Executive Director says, 'No. No. No Y2K problems with nukes.' Please! I can't make up stuff this terrifying. Anyone else think that Homer Simpson is running the NRC?"

Rick Cowles Interview:

Cory Hamasaki's 3/3/1999 DC Y2K Weather Report :


By Linda Becker and James Gregory

It is clear from internal documents posted on the file transfer site of the NORTH AMERICAN ELECTRIC RELIABILITY COUNCIL (NERC), that NERC wants the public to know as little as possible about the state of the electric utilities Y2K readiness. As mentioned in Y2K Report 18, NERC's drill on April 9 will be conducted by the 22 bulk electric operating entities of North America. The specific focus is to "sustain reliable operations with a simulated partial loss of voice and data communications." (This is an interesting concept in and of itself, since we have yet to figure out how a phone system would only work "partially.") Each of the bulk operators is directed to write their own test and NERC has asked them to keep the drill simple and to try and run it on a parallel, rather than live systems, if possible. Whatever the outcome of the drill, NERC makes it clear that the results are already preordained for success.

Bruce Beach of Y2K PEOPLE FINDING PEOPLE gleaned this edited insight from the NERC website:

"In NERC documents <"y2k-exceptions-instructions.pdf"> and <y2k-reporting-changes-1-12-99.pdf>, NERC states that utilities attempting to conform but missing the due dates because of 'readiness exceptions' will be allowed to report their mission-critical systems as 'Y2K ready' as long as these utilities report Y2K deficiencies to NERC in 'confidential' emails. 'All identified exceptions will be held in strict confidence and will not be reported to DEPARTMENT OF ENERGY or the public.'"

It is also interesting to note that the test is scheduled on a Y2K "spike" date: the 99th day of 1999. We will not speculate as to why these date was chosen, but it certainly is food for thought.

Now, to make matters worse, COMMERCE BUSINESS DAILY has reported that the "U.S. DEPARTMENT OF ENERGY, Office of Management and Administration, intends to award a sole source [non-competitive] contract to NERC to access its unique knowledge of, and expertise in, electric utility industry reliability issues. This action is in support of the Department's industry oversight responsibilities to assure readiness for an uninterrupted transition at the Year 2000 boundary."

Beach was astounded by the news and responded this way: "Have you ever heard of anything so nutty -- awarding a contract for the search for truth to someone who has already put in writing that they are going to lie to you?" (Sources: COMMERCE BUSINESS DAILY, 3/8/1999; NERC Website; Bruce Beach, Y2K PEOPLE FINDING PEOPLE, 3/15/1999, thanks to Jonathan Reams, special thanks to WEBPAL.ORG for providing links)

Link: ftp://www.nerc.com/pub/sys/all_updl/docs/

Link: http://www.GovCon.com


By James Gregory and David Sunfellow

Despite flowery assurances and billions of dollars spent, few companies have come forward to claim fully-tested Y2K compliance. As explored in numerous articles in the NHNE Y2K Report, there are a number of possible reasons for this, some of the most likely being:

- The work has not been done, and the company is trying to put a positive spin on a bad situation.

- The work has been done, but the company is not prepared to make a public statement out of fear of legal repercussions.

- Some work has been done, but there is not enough time to complete it.

In his article, "Promises to Keep," Y2K analyst Peter de Jager maintains that, "Tens of thousands of companies and agencies have spent billions of dollars making sure their systems won't fail at the turn of the century, that production of their goods will continue unabated, and that the public need not fear disruption of their critical services." In an attempt to be a force of good in an otherwise bleak and dreary Y2K landscape, de Jager has created "Year 2000 Promises Kept," a regularly-updated list of companies and organizations "that have acted responsibly to mend their Y2K problems" which "deserve recognition, for their own sake as well as the public." Here are the names on his "Promises Kept" list, as of March 12, 1999:

Air Products, ANZ Bank, Asarco, AT&T, Avista, Bank One Corporation, Battle Mountain Gold, BB&T Corporation, Bear Stearns, Bank of Montreal, Bank of New York, Canada Trust, Clarke American Checks, CNA Insurance, Firstar Bank, Fleet Bank, Frost Bank, H.E. Butt Grocery, Lockheed Martin, Hydro Quebec, Manulife Insurance, Mercantile Bank, Mutual Life of Canada, Nations Bank, Nav Canada, NCUA, Northern Trust, Ontario Hydro, PNC Bank, Sanwa Bank, Scotiabank, Shaw Industries, SouthTrust Bank, Toronto Dominion Bank, Toronto Stock Exchange, Union Pacific Railroad, USNRC, US Trust, Vanguard, Wal-Mart.

In addition, de Jager invites any other business, agency or organization which has "licked its Year 2000 problems -- or an identifiable portion of them" to pass the information along ("promises@year2000.com") so he can add it to his good-news list. "It just might help others find a way to squash their own Y2K bugs."

While we laud anyone's efforts to see the positive in a difficult situation, NHNE has some concerns about de Jager's approach. One issue is claims without content. Nowhere in de Jager's literature do we see organizations claiming to be fully compliant and fully tested. Instead, we see emphasis on the amount of money spent ("billions of dollars "), and good intentions ("systems won't fail, the production of goods will continue unabated, and the public need not fear disruption of their critical services") and partial compliance ("having licked an identifiable portion of Year 2000 problems").

The second concern is that claims are self reported. This is the same major failing of the grades of government departments assigned by Cong. Stephen Horn. The only truly reliable claims are those provided by independent auditors.

The third problem is with some of the names on de Jager's "Promises Kept" list. AT&T, for example, admitted in a January REUTERS article that their systems were vulnerable to significant Y2K failures and had cranked up Year 2000 spending by more than 50 percent (Y2K Report 16).

Meanwhile, earlier reports that six Fortune 500 Companies had licked their Y2K problems have also been challenged.

In NHNE Y2K Report 5, we reported that Robert Egan had designed a survey to measure the status of the internal remediation of IT and embedded systems of Fortune 500 companies based on information filed with the SECURITIES & EQUITIES COMMISSION (SEC). Published in November of 1998, Egan's report indicated that FLEET FINANCIAL GROUP, BEAR STEARNS, WACHOVIA CORP., DTE ENERGY, EMC, and FLEETWOOD ENTERPRISES were all fully compliant. But on March 12, Gary North reviewed the latest 10-Q filings of all six companies and discovered that none of them were claiming full compliance. Why? Because compliance must include internal systems, vendor-supplied systems, PC's, embedded chips, and data links -- and all six of these companies (like all the other Fortune 500 companies) were having difficulty with one or more of these critical areas.

What does all of this mean? While many major companies are making significant progress in their efforts to become fully compliant -- and should be publicly aknowledged for this -- very few, if any, have crossed the Y2K finish line. (Sources: Peter de Jager, YEAR 2000 INFORMATION CENTER, 10/30/1998, 3/12/1999; Andrew Hay, REUTERS, 1/4/99, Gary North, 3/12/1999)
Link: http://cnnfn.com/digitaljam/wires/9901/04/y2k_wg/

Promises to Keep:

Promises Kept:

Robert Egan Fortune 500 Report:

Gary North's "Are These Six Fortune 500 Firms Really Compliant?":


By James Gregory

Something is seriously wrong at the FEDERAL AVIATION AUTHORITY (FAA). On September 29, 1998, FAA administrator Jane Garvey announced that the FAA was 99 percent complete in their Y2K remediation. On November, 1998, Garvey retroactively said the FAA's Y2K remediation was 100 percent complete, with only the testing phase remaining. The December 31, 1998 compliance deadline came and went without any further word from the FAA. In March, 1999, an FAA spokesperson said the agency would be 65 percent done by March 31. On March 5, 1999, Alexis Stefani, a spokesperson for the FAA Inspector General said only 31 percent of the agency's computers were fixed. Also on March 5, 1999, FAA spokesperson, Paul Takemoto, claimed all FAA systems will be compliant by June 31. (There are only 30 days in June!)

What to believe? FAA Inspector General spokesperson, Alexis Stefani, explains, "The FAA now faces an additional kind of problem. They're shooting for the end of June to have all of their systems done, but it becomes an implementation [problem]." Cong. Stephen Horn (R-CA) adds: "Although the problem of converting these systems to the Year 2000 was recognized long ago, its lack of attention...has turned this manageable problem into a potential crisis." "We got a late start in FAA, a little bit. I'm very optimistic," said Steven Zaidman, an associate R&D administrator at the FAA. Do you feel better now? (Sources: Y2KNEWSWIRE, 3/18/1999; Y2KCULTURE, 3/8/1999; Erich Luening, CNET NEWS, 3/5/1999)

Link: http://www.y2knewswire.com/19990318.htm

Link: http://www.y2kculture.com/reality/19990308.travel.html

Link: http://www.news.com/News/Item/0,4,33379,00.html?st.ne.87.head


(Source: Majority Leader Richard Armey's Website)

In his most recent quarterly report (February, 1999), Congressman Stephen Horn raised the U.S. government's Y2K compliancy grade from a "D" to a "C+" (Y2K Report 16). Horn's report indicated that grades were awarded according to percentages of compliancy: a base grade of "A" was awarded to an agency whose mission critical systems were estimated to be 100 percent compliant before the March 31, 1999 deadline; 90 percent and above received a "B;" 70 percent and above a "C;" 60 percent and above a "D;" anything below 60 percent compliant received an "F."

Now we learn there's more to these grades than meets the eye. House Majority Leader Richard Armey recently revealed on his website that, other than "A," all Congressman Horn's grades are based on compliance AFTER 1/1/2000, using the following benchmarks:

"A" - Before March 31, 1999

"C" - By the end of 2001

"D" - Any time in 2002

"F" - Any time later than 2002

Glaring deficiencies in four additional areas can also lower agency grades from their base grade:

1. Contingency Plans
2. Telecommunications Systems
3. Embedded Systems
4. External Data Exchange

Armey also pointed out that Horn's grading system is based on the "self-reported" status of mission-critical systems -- a dubious pattern that is rampant in both the government and private sectors. Such a system, echoes the recent U.S. Senate Report on Y2K, is "analogous to letting students grade their own tests." (JG, DS)

Link: http://www.freedom.gov/y2k/grades/how.asp


(Source: CSB INVESTIGATION & NEWS, 3/15/1999)

Citing "significant gaps" in awareness, surveillance and communications, the U.S. CHEMICAL SAFETY AND HAZARD INVESTIGATION BOARD (CSB), an independent federal agency with the mission of ensuring the safety of workers and the public by preventing or minimizing the effects of industrial and commercial chemical incidents, has presented a report on potential Y2K problems among chemical manufacturers, handlers and users to the SENATE SPECIAL COMMITTEE ON THE YEAR 2000 TECHNOLOGY PROBLEM.

The report was the result of a collaborative effort between the CSB and industry, labor, government and environmental group representatives. "This industry is already accustomed to dealing with dangerous chemicals, and although I am hopeful there won't be Y2K-related accidents in the chemical industry, the risks are too great to chance the possibility of failures that threaten human lives," explained Robert Bennett, Committee Chair.

The report found that large chemical companies with sufficient awareness, leadership, planning and resources to address the Y2K problem are not likely to experience catastrophic failures -- unless there are widespread power failures. For this reason, the report stresses the importance of preserving the national power grid and local utility continuity. Given the lack of information about small and medium-sized chemical businesses, readiness efforts appear to be "less than appropriate."

The complete report is available both as an MS Word file and an Adobe PDF document. (JG)

Link: http://www.chemsafety.gov/1999/news/n9919.htm


(Source: DEFENDYOURPRIVACY.COM, 3/20/1999)

In response to proposed "Know Your Customer" legislation (Y2K Reports 5 & 16) , the FDIC received over 250,000 letters, email messages, and faxes during its public comment period, which ended on March 8. Of those, 171,268 were generated by the online petition promoted by DEFENDYOURPRIVACY.COM alone!

In the wake of the public outcry against "Know Your Customer," it seemed like everyone was leaping forward to claim credit for killing it. On March 8, the head of the FDIC, Donna Tanoue, announced that "the public has spoken very loudly and clearly," and that she would urge the FDIC's board to drop the controversial rule. The COMPTROLLER OF THE CURRENCY issued a similar statement. The U.S. Senate voted 88-0 to ask the FDIC to withdraw its proposed "Know Your Customer" rule. While symbolically important, the resolution lacks the force of law, and doesn't repeal the authority of the FDIC and other financial institutions to impose "Know Your Customer" regulations.

In the HOUSE BANKING COMMITTEE, Rep. Ron Paul (R-TX) sponsored Amendment 8 to HR-10 that would have prohibited the FDIC from implementing any form of "Know Your Customer" regulation. Rep. Bob Barr (R-GA) and Richard Baker (R-AL) introduced a much weaker substitute amendment that ultimately passed the committee. The bill still has to be approved by the full House and Senate, and be signed by the President, before it becomes law.

While the Barr-Baker amendment would block the current "Know Your Customer" proposal, the door is still open for similar proposals in the future. In addition, two out of the four agencies that originally sponsored "Know Your Customer" -- the OFFICE OF THRIFT SUPERVISION and THE FEDERAL RESERVE -- have yet to take a public position. The FDIC is also considering other options; for example, an FDIC spokesman indicated that while the agency might withdraw the regulation, it could implement "Know Your Customer"-style requirements as a "policy" instead. For these reasons, it is too soon to declare the rule dead in the water.

Meanwhile, support for HR-516, "The Know Your Customer Sunset Act", is growing rapidly. The bill now has 47 co-sponsors, including influential members like Majority Whip Tom Delay and JUDICIARY COMMITTEE Chairman Henry Hyde. DefendYourPrivacy.com plans to begin a new petition campaign to permanently stop "Know Your Customer." (JG)

Link: http://www.DefendYourPrivacy.com



(Source: Sheri Nakken, Y2K NETWORK, 3/17/1999)

The landmark Senate Y2K report released in early March (Y2K Report 16 & 17) is now available in a more accessible, non-PDF format. (JG)

Link: http://www.best.com/~mgoodfel/


(Source: COMMUNITY GUIDE TO Y2K Website, thanks to Tracy Sloan)

The U.S. GENERAL SERVICES ADMINISTRATION (GSA) has created a website for local communities to use in educating their citizens on how Y2K may affect their daily lives. Designed around the basic needs of daily life (power, water, food), the site can help people:

- Learn the current status of Y2K preparations.
- Find questions to ask their local grocer, banker, pharmacist and others about Y2K.
- Print out letters to send to their goods and service providers concerning Y2K.
- Learn more about other communities preparing for Y2K. (JG)

Link: http://www.itpolicy.gsa.gov/mks/yr2000/community/community.htm



Marc Pinneo, author of "A Layman's Guide to the Year 2000 Computer Crisis," is compiling a directory of Y2K community preparedness groups on a state-by-state basis. He is offering a free web page to groups that would like to be included in the directory. Pinneo can be emailed at: "MarcP@ocweb.com". (JG)

Link: http://www.ocweb.com/y2k/Y2KGroups.htm


By James Gregory

The April issue of WIRED MAGAZINE features four hard-hitting articles on Y2K, plus a dramatic black-on-black cover with the title: "Lights Out: Learning to Love Y2K."

According to Y2K analyst Gary North, the essay by programmer Ellen Ullman, "The Myth of Order" should dispel any doubts about the complexity of the task ahead of us. "The real lesson of Y2K," says Ullman, "is that software operates just like any natural system: out of control." Her follow-up article, "This Is Not a Test," uses real-life examples from TEXACO. One Y2K conundrum: "Texaco relies on the utilities for power, and the utilities rely on Texaco for fuel." Jacques Leslie's article, "Powerless," is an account of the ice storm in Montreal in January-February, 1998, where 45 people died, 100,000 were put into public shelters, and insurance companies were hit with $1.2 billion in claims. The parallel with Y2K prompts Wired to comment: "What happens at 00:00:01? Try deadly, black and very, very, cold." Leslie's second article, "Life in the Dark," provides a detailed account of the Auckland, New Zealand's five-week power blackout in February, 1998.

The magazine also features an image of a grim, desolate landscape littered with burnt-out wires and a quote from Jay Ashier, Texaco's Year 2000 Project Manager, "Y2K can't be the end of time. It's too obvious." The back page of the magazine whimsically displays 0's and 1's in the shape of an Absolut vodka bottle ("Absolut Y2K").

The articles will not be posted on the Wired Website for another six weeks, but North is adamant, "Don't wait. Go down to your local magazine stand and buy it." (Sources: Gary North, GARY NORTH'S Y2K LINKS AND FORUMS, 3/17/1999; WIRED MAGAZINE, April 1999)

Link: http://www.garynorth.com/y2k/detail_.cfm/4122



(Source: S. George, THE MONITOR (Kampala, Uganda), 3/14/1999)

[These edited excerpts are from an article published in a Ugandan newspaper. They would be funnier if they hadn't been written in all seriousness. If only it were so simple. -JG]

"There is lot of news in the U.S. about how countries will be hit hard by the Y2K problem on January 1, 2000, when most computers will just go crazy and go back to back to the year 1900. On the bright side, this could be the opportunity for countries like Uganda to make it big time."

"Assume it turns out that Y2K is worse than anybody expected; power is out, companies are crippled, nobody can produce anything. Uganda, which never made the transition to computers much anyway, is able to escape with little to no problems at all. Suddenly, demand for goods is high, the economy booms."

"While other countries are in the civil unrest, mobs ransacking the stores, Uganda and many other poor counties like it, are able to move ahead without any problems. Since equipment won't work, labor demands [increase] in Europe and North America [and] rural Ugandans find jobs at huge wages."

"The world slumps into a global recession. Uganda, with its booming economy and now wealthy population, is able to press ahead and make great strides in fixing up its infrastructure and building new factories. As the other countries start to come out of recession, now Uganda is able to compete."

"As every company was forced to buy new equipment and retool their factories, Uganda did the same with all the new money it found. Suddenly Uganda is on par with many other countries. Ugandans start to return home from Europe with skills and find work in the new factories built while the rest of the world was down. Villages turn into boom towns. The once poor, now wealthy, villagers spending their new wealth on brick homes, appliances, and furniture strengthens the Ugandan economy even more."

"The U.S. and Europe are so caught up in legal action against each other, productivity [there] is at an all-time low. Uganda is making all-time records in productivity and exports. The government with unexpected tax gains, is able to start to fully fund education, health and infrastructure projects. Hospitals are built, schools receive new books and teachers. Roads are fixed and utilities added to every village." (JG)

Link: http://www.africanews.org/east/uganda/stories/19990314_feat12.html



The stories in this week's NHNE Y2K Report were drawn, in part, from the following news sources:









Copyright 1999 by NewHeavenNewEarth

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