IP: Two Y2K articles: power could go out & human inventiveness

[Dave Farber <farber () cis upenn edu>]

From: Declan McCullagh <declan () well com>


http://www.thisislondon.co.uk/dynamic/news/business_story.html?in_review_id=
93322

November 20, 1998

United Utilities in 2000 bug chaos alert

    by JONATHAN PRYNN

    North-west energy and water supplier United Utilities
    today became the first major company in its sector to spell
    out the stark truth about the millennium bug, warning that
    there is "a risk of failure" on the big night. 

[...]

    The group already has emergency and disaster plans in
    place, which "will be used as a basis on which to develop
    the additional plans necessary to ensure we are ready to
    cater for impacts of the millennium date change". 

[...]


**********

From: "Alan Docherty" <freenet () globalnet co uk>
To: "Declan McCullagh" <declan () well com>
Subject: Human ingenuity may save us from millennium mayhem
Date: Sun, 22 Nov 1998 21:53:30 -0000 

Declan,

> From the business section of the Observer today, a voice of sanity that says
we have the capacity to survive Y2K.

Alan

Sunday November 22, 1998

Bug puts the bite on world recovery

But human ingenuity may save us from millennium mayhem, writes Anthony
Browne


It may be banal. It is definitely nerdish. But it could be a bigger threat
to the global economy than the current financial crisis.

The Treasury has admitted that it will hit the economy, but has no idea how
badly. Independent economists are less cautious: after the millennium, they
warn, the world is likely to find itself in severe recession.

The culprit is not devaluing currencies, debt overhangs or ballooning trade
deficits. It is errant pieces of computer code: the millennium bug.

[...]

To protect themselves, many firms are likely to start stockpiling supplies
towards the end of 1999. But this in itself could make a recession more
likely: it will boost growth next year and make the slowdown in 2000 more
pronounced as companies use up stocks rather than placing more orders.

Cottrell said: 'It's this stockpiling which is usually responsible for
sending economies into recession.'

The bug's effect abroad could hit Britain in more straightforward ways. Many
of this country's trading partners, such as Japan and Germany, are far less
advanced in solving the problem. In Japan, the financial system is near
collapse anyway, and preparations are way behind. Widespread computer
disruption could bring economic disaster.

The bug comes just as the global economy is struggling back on to its feet.
'You could have a double whammy,' said Flower, 'A soft landing could turn
into a hard landing if the bug does its worst.'

The antidote to all this gloom could be something far simpler: good old
human inventiveness. Earlier predictions of catastrophe - from Malthus's
1798 warning about famine to the Seventies fear of energy shortages - have
so far been confounded by improved agricultural productivity, better
oil-extraction technology and improved energy efficiency. If their computers
go, small companies in particular will be able to go back to pen and paper.
If the lift goes, you can take the stairs.

The Organisation for Economic Co-operation and Development, said: 'Past
experience suggests that people are resilient and adapt well to serious
disruptions in ways that minimise overall macro-economic effects.'

Alan Wilson of consultancy Oxford Economic Forecasting has studied the
impact of the bug, and predicts that it will depress economic growth by only
0.3 per cent. 'We were reassured by looking at some of the other disruptions
economies have faced,' he said. 'The three-day week in the Seventies had a
remarkably small effect on GDP, and Canada quickly got back to normal after
the ice storms earlier this year.'

You could also drown your sorrows at millennium parties, but this could be
another case of the cure killing the patient. The large-scale preparations,
celebrations and millennium building projects will boost growth in 1999 -
one estimate is that it will be by as much as 1 per cent. But again this
will wind down in 2000, reinforcing the slowdown.

There is probably only one way to escape a millennium recession. Cottrell
suggests: 'Go to live and work in an economy that isn't based on the
Christian calendar - you'll be laughing.'

http://reports.guardian.co.uk/articles/1998/11/22/p-34482.html





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_____________________________________________________________________
David Farber         
The Alfred Fitler Moore Professor of Telecommunication Systems
University of Pennsylvania 
Home Page: http://www.cis.upenn.edu/~farber