If you are not familiar with the Year 2000 Problem, it can be summed up like this: In the 1950s when memory was scarce, programmers used two digits to store the year, as opposed to using four digits. The problem is that computer systems assume that the century digits are 19. If you were born in 1920 and the current date is 1999, the computer system would subtract 20 from 99 to determine your correct age of 79. However, what happens when the year 2000 roles around? An unprepared system will subtract 20 from 00, showing your age as -20! Think about the potential impact on our credit cards, banking institutions, the Social Security System, weapons systems, hospitals, and the stock market. Incorrect calculations based on a two-digit year, as opposed to a four-digit year, can have devastating consequences. For instance, assume your ATM card expires in the year 2000. It's possible that the ATM machines may interpret the year as 1900, and inform you that your ATM card expired 100 years ago!

Since the 1950s was the middle of the century and memory was a precious commodity, using a two-digit year was not seen as a major problem by most programmers--it was a way of conserving storage space. While some programmers were aware of the potential problems with calculations involving 21st century dates, the 21st century was still 40 years into the future. Any problems could be corrected by that time, or so they thought. If you flash forward 49 years from 1950, we have over a trillion lines of code that need repair, costing from $500 billion to over a trillion dollars to correct. Estimates suggest that only a small percentage of U.S. businesses are Y2K compliant, and it is even worse outside the U.S. because Europe has been busy concentrating its efforts on its new currency. Efforts have not been much better in the Far East.

Part of the problem too is that while your company may be Y2K compliant, it does not mean that the other businesses with which it interacts are, thus creating a domino effect. Assume for a moment that you are in the grocery wholesaling business. What happens if your suppliers are not Y2K compliant? Even though your system is ready for the new millennium, it still does not mean that your company will receive its goods from suppliers that are not Y2K compliant, and if you cannot receive your goods from your suppliers, you will not be able to sell to the grocery retailers. If we take this scenario and apply it to the banking industry, again your bank may be Y2K complaint, but the other banks with which it interacts may not be, thus creating problems with currency exchanges, interest calculations, and electronic funds transfers.

What are the potential side effects of this Y2K problem other than those alluded to above? The answer to this question is that no one really knows. The alarmists suggest that the world as we know it will cease to exist, massive power failures will occur, the stock market will crash, food shortages will occur, the banking system will fail, nuclear weapons will be launched, looting will begin, and the list goes on. In efforts to prepare for the impending doom, families are stockpiling food, gasoline and medicine, moving out of the cities for more rural locations, and learning as much as they can about medicine and dentistry. On the other hand, more conservative opinions suggest that this is a lot of hype, with Y2K consulting groups and programmers reaping the financial rewards gained from Y2K hysteria. The 'middle of the road' individuals suggest taking some precautions in preparation for the millennium bug, but suggest not going to extremes. For instance, they suggest not moving out of town, but keeping paper records of all financial transactions, and stockpiling some cash just in case.

1. Why do other countries appear to be less concerned about the Y2K problem?

2. What impacts will Y2K have on our transportation system?

3. How can you prepare for Y2K?