By Michael K Anderson

AUGUST 17, 1998:  In a fateful scene from the most popular movie in recent Hollywood history, director James Cameron provides a few golden opportunities for viewers to savor their hindsight.

"Take her to sea, Mr. Murdoch," the captain of the Titanic commands. "Let's stretch her legs."

Today, an iceberg field looms in the foreground for all the world's computerized societies. Less than 17 months from now, an inestimable number of computers and embedded computer chips will begin malfunctioning and shutting down, inconveniencing or compromising elements of communications, power, finance, government, industry, essential services, and transportation networks with consequences that are currently a matter of rampant speculation.

The "bug" behind it all is a surprisingly ubiquitous programming shorthand that saves computer memory--a precious commodity in the '60s and '70s when many of the systems now running everything from power grids to banking systems were designed. But this shorthand also leaves a computer unable to process correctly any date after Dec. 31, 1999. (The fatal flaw involves keeping track of years with two digits instead of four. Thus 1998 becomes 98--but 2000 cycles back to 00, 2001 becomes 01, and so on.)

According to the experts and observers following the fix that's now under way, the "millennium bug" will bring anything from a few bumps in the road to Armageddon 2000. On one extreme are an assorted lot--anticipating global shortages, famine, social turbulence, and economic hard times--who have already begun preparing for the worst. On the other are those confident that the patch-up job will work with only a few shortcomings, perhaps the equivalent of an extra natural disaster or two in the Earth's near future.

All, however, must place their faith in a phalanx of programmers and computer professionals who are working full-time to put together "Year 2000-compliant" systems that will at least limp through the first few years of the millennium until a more permanent fix comes through. Their task is unenviably formidable, since, according to some estimates, 22 percent of the world's computer code--having been built up and debugged over a period of decades--needs to be tinkered with, and some 2 percent of the world's 40 billion computer chips--embedded in everything from communications satellites to fiber optic relays on the ocean floor--will need to be replaced or worked around.

And all of this must be done before Jan. 1, 2000: a deadline unlike the project deadlines that bureaucracies usually face. This one can't be pushed back by a second, let alone a few fiscal quarters.

By any estimate, completing the fix would take years, if not more than a decade. But most organizations have only been on the Y2K problem ("2K" being nerdy slang for "2000") for a few years--many first heard about the issue when the alarm bells rang in the technical press in 1996. The U.S. Social Security Administration, for instance, is often cited as the paragon of institutional foresight, having worked on Y2K since 1991. But even that agency recently discovered some extra 30 million lines of computer code that need to be reworked. In short, no matter how one looks at the problem, there's not enough time to make a clean, complete Y2K fix for all the non-compliant computer chips and systems around the world. The big question--perhaps one of the more important questions for the foreseeable future--is, will the incomplete fix work? Or will the pyramid of stopgap solutions come tumbling down, taking some of the trappings of modern civilization with them?

There's middle ground to be found, of course. And that's where much of the considered opinion falls these days.

"Telling the public that the computers can't do arithmetic and they face imminent danger is such an abstract concept that most do not take it seriously."

These words, spoken by Alan Simpson before a recent U.S. House of Representatives subcommittee meeting on Y2K, reverberated on Capitol Hill for a few seconds. But they'll continue to resonate for some time.

For the past three and a half years, Simpson has been advocating public readiness for power outages, food shortages, work stoppages, and at least a tablespoon of chaos. He likens the Y2K crisis to a meteorological disaster--only with the potential of being on a global scale.

"It's like a hurricane," he said recently. "If you're prepared, it's an inconvenience. If you're not prepared, it'll wipe you out."

Simpson has been in the media and telecommunications business since the late '70s--developing satellite communications links for U.S. embassies around the world. His affable demeanor and steely pragmatism are well-suited to a task that entails communicating the importance and scope of a worldwide problem with a complexity that escapes even the grasp of entire organizations, let alone any single individual.

"Global telecommunications is in a real mess," he observed. "Most of the countries in the world haven't even started [fixing Y2K]. Some don't even know about it. Those are the ones, especially third-world countries, that use hand-me-down equipment from the West. Look at Russia--they don't have any programmers. All their programmers have gotten the hell out of Dodge and come to work in Europe and America. So they aren't going to fix anything. When you look at the global picture, it gets pretty messy."

Domestically, the problem becomes at least marginally more manageable than it will be in, say, the former Soviet Bloc countries. Lucent Technologies, for instance, has made a free patch available for some of its switches, and AT&T has gone on record that it plans to be 100-percent Y2K compliant by next year at this time.

Still, even in an ideal world where every suspect relay has been rewired, things start looking less rosy when you pull the lens back a little farther, Simpson noted.

To run a phone system, one needs a stable power source. But the continued, uninterrupted flow of electricity is not a sure thing when the millennial date change comes. Sen. Christopher Dodd of Connecticut, for example, expressed his dismay when the Senate's committee on Y2K learned that only two of the 10 major utilities it had spoken with had even completed their assessments of the situation.

"We're no longer at the point of asking whether or not there will be any power disruptions," Dodd said. "But we are now forced to ask how severe the disruptions are going to be."

One recent harbinger of danger on the horizon was a February power outage in Auckland, New Zealand, that was unrelated to Y2K. Power cables leading into the city failed, and according to Reuters, the resulting power loss "crippled the hub of the nation's business community." Some residents' water and sewage systems stopped working. All activity but essential services came to a standstill. Students locked out of their dormitories had to camp out in the suburbs. After Auckland, many Y2K observers--including Simpson--had a new outlook on the prospects for a clean fix. "I would be less pessimistic had I not seen Auckland," Simpson said. "It took them six weeks to get normality returned in one city. And they had the rest of the nation running perfectly normally. All the backup generators burned out in 12 hours. That was a real wake-up call that no one here has even heard of. That made me realize how ill-prepared we are."

Rick Cowles has been in the electric utility industry since 1980--from the board room to the shop floor to the control room--and is currently one of the world's leading experts on Y2K in the electric industry. He doesn't like the message the Auckland outage delivered.

"There are some parallels--obviously no direct connection to Year 2000 stuff, because the problems in Auckland were a result of some cable failures in their central business district," Cowles said. "But I think it was very instructive what impact a prolonged power outage would have on an economy. There were quite a few businesses in Auckland that couldn't weather the power shortage and simply went out of business. It will be interesting to see too how the power company will weather the law suits that'll be coming out of this. It's a precursor to what you're going to see on 1/1/2000."

As one of many who helped bring about the situation the world is now scrambling to rectify, Bernadette Reiter claims mea culpa.

"I helped to invent the problem," she said in a phone interview from her Boulder, Colo., home. "I coded things with two digits, and it was on purpose. I programmed in the mid- to late '70s through the '80s. Back then, we started out [with our data] on punch cards. And a punch card only had 80 characters to reflect, say, a personnel record. When you had only 80 characters, you really had to save space, so you lopped off the upper two digits of any year. But none of us thought that the software would still be in operation today. That was the era when people replaced their car every few years. There was no relationship with the year 2000, psychologically. So you never even thought about it."

She--and the Y2K organization to which she belongs, the aptly if somewhat fatalistically named Cassandra Project--have devoted their resources to raising awareness about this potential disaster and to making sure individuals and communities are prepared for it.

"I flagged this problem to the Pentagon more than a decade ago," Reiter noted. "Everybody said, 'Oh, some clever person will come up with an easy fix.' I kept saying, 'Hey, there is no easy fix.' Then in '96, it hit the technical press--front page news. And I went, 'Oh, shit.' The Gartner Group [a software industry think tank] outlined that 90 percent of our software is not Year 2000 compliant. I'm thinking, 'Ninety? We carried all this stuff forward?' So I called a friend of mine at Hewlett Packard who I worked with in the '70s. I asked her, 'You know all that software we wrote back in '76-'77? Is it still running?' She called around and called me back. She said, 'Yep.' "

Having seen programmers get out of a lot of tight spots in her time, Reiter was initially optimistic about the prospects for nationwide, if not global, Year 2000 compliance. But she's since lost some of her faith, thanks to many Y2K teams showing what she sees as short-sighted opportunism.

"I'm not so wildly optimistic now," she said. "We've frittered away so much time. And the techno people are clueless. It's frightening how ill-equipped they are to handle this problem. What's been tough is the lack of progress and the job-hopping that's going on by programmers. The programming community is seducing management by saying, 'We have it well in hand and under control, and we'll have it ready by the end of this year or first quarter next year.'

"The software industry, having been in it for 25-plus years, is notorious for never making a date on time. And this date is not negotiable. So I have zero confidence that programmers can sort it all out."

Then there's the automated Y2K-fixing software that's entering the marketplace. These programs sort through computer code, ideally to find all instances where years are expressed in two digits and expand them to four. However, Reiter pointed out, that process can introduce as many problems as it fixes.

"There's a lot of naivet here," she said. "As programmers, there are no naming conventions for variables--like date of birth or mortgage origination date." So divining which parts of a program stand to be affected by Y2K--which is only half the battle--can be as challenging as reading heiroglyphics used to be before the discovery of the Rosetta Stone.

And whether or not the software can be fixed, millions of non-compliant computer chips or "embedded systems" in orbit, on the ground, under the ground, and underwater must also be found, fixed and replaced, or worked around.

One bugbear that Y2K fixers have to be especially mindful of, Reiter added, is that an unknown number of systems out there don't even treat '00' as a year at all. Since they never thought their code would still be in operation in 2000, some programmers used '00' to trigger an exception. So '00' to a system handling credit cards may mean your card has been permanently revoked. To an elevator, it may mean a quick stop.

"We're not real sure what it means to, say, a missile," Reiter said. "Or to the billions of embedded systems out there. It's the dual meaning that's the killer here. The rocky road would be fine if we were only dealing with a rollover where we transit from 1999 to 1900. But if there's another meaning assigned, then who knows? Because it's not the exception; it's the norm. The exception code starts executing as if it were normal."

Ultimately, Y2K all starts with the power grid. Electricity is the manna of modern living, and without a stable source of juice, a lot of problems in seemingly unrelated areas--food, water, gas, sewage, communications, transportation, government services, business, finance, money, and banking--begin to crop up. In Cowles' estimation, the grid has several potential failure points along the line, from the rail delivery of fuel to computer controls in power plants to switching stations. (He's optimistic, in any case, that we won't be seeing any Three Mile Islands or Chernobyls anytime soon, since the U.S. Nuclear Regulatory Commission is requiring all American nuclear systems to prove their full Y2K compliance before the date change or face a mandatory shutdown. All other countries with nuclear reactors, it is hoped, will be similarly hard-nosed.)

"There's a lot of automation in the production and transmission of power," Cowles said. "Much of the automation is microprocessor based, and any microprocessor-based system has the potential for a Year 2000 problem."

He's found that, as is typical in the Y2K world, problems appear in the most unlikely of places. "You might find it in fault logging and monitoring or in date and time stamping of critical functions," he observed. "In some embedded systems, there are clocks built in with no real system function, but the clocks are still operating, and if those internal clocks aren't Year 2000 ready--whether they're used or not--the microprocessor control still has the potential for failing."

All the companies and government agencies now preparing their Y2K fixes are all effectively working on their own individual problems. But, Reiter pointed out, no leader or leaders have yet emerged to watch out for the whole web.

"One of the problems is, no one is looking at that 32,000-foot view of how all these things are interrelated," she said. "How the failure in one system can cause a failure in something else. In 1996, a power plant went out in California and it browned out five states. Now that was one power plant. So you've got a situation where the grid is all interconnected. That's a single power plant moving its power off the grid, and you can have that kind of effect on the grid. It's illustrating the fragility of the grid itself."

The California outage had its ripples too, Reiter noted. "If you start losing the power grid, that affects water, sewer, and gas," she said. "With water, sewer, and gas, you start talking about potentially having to deal with contaminated water--because computers control how much chlorine and fluoride goes into the water. When that California plant shut down, a sewage treatment plant, when it lost power as a result, dumped its sewage into the ocean and polluted Santa Monica's beaches."

The industrialized world's reliance on computers and automated processes extends beyond public utilities too. And they're as much a part of the spiderweb as anything else.

"We've gotten really good in using computers for the concept of 'just in time' in manufacturing," Reiter said. "As a producer of anything, you don't want any surplus. So you're trying to cut the window narrower and narrower between the order and when you actually make something. Some grocery stores have only 72 hours worth of food on their shelves."

And that means any disruption in the transportation grid could have immediate adverse effects. Reiter cites the example of air travel. The FAA, she points out, runs its air-traffic-control systems primarily on old non-compliant IBM hardware, which is so antiquated that IBM has said it has no intention of fixing it. The Dutch airline KLM has, in fact, already considered declaring no-fly zones in regions where Y2K air-traffic-control problems would stand to risk passengers, crew, and aircraft after Dec. 31, 1999.

But, if air traffic is reduced or grounded, any company relying on air freight--including supermarkets and restaurants, who need food shipments from warmer climes, especially during the winter months--stands to be hit hard.

Y2K activists such as Reiter and Simpson still hold out hope that in the next 17 months the country will get its act together and steer through the iceberg field. The key, though, is missing today. "I tend to be somewhat optimistic, having been through many battles in my life. Against all odds, nations pull together--if they have leadership," Simpson noted. "If there's a leader that emerges-- I don't know who it's going to be; it certainly isn't Clinton and it certainly isn't Gore--who can get the whole nation to pull together, then yes, I think it'll be livable by 2000."

Critics of Y2K activists today say they're out to sell books, lectures, videotapes and are scaring a lot of people in the process. Time magazine's June 15 article on Y2K, for instance, was dismissively titled "Apocalypse Not."

Reiter counters that the facts speak for themselves.

"People look at this and say we're being alarmist," she said. "I think the bottom line is, we're just being realistic. There are too many potential points of failure. It's like the Titanic. It's full steam ahead, and everybody thought we were unsinkable, infallible. But when we finally saw the iceberg in 1996, the ship was so big that it was impossible to steer clear. The engineer told the captain in the movie that it was a mathematical certainty that the ship's going to sink. I think it's a mathematical certainty that we're going to have failure and probably failure in some very critical areas."

"What Joe Public has got to do is make damn sure that the people who are tasked to do it do it. Not just sit back and say, 'Yeah we're looking at it; now go away,' " Simpson observed. "If everybody gets their back into this, it will just be an annoyance. It will not be Apocalypse 2000."

Simpson ultimately is optimistic that there will be workable Y2K solutions at least to keep things running. But, he said, there's much ground to be covered over the next year and a half.

Ideally, one could just throw a switch that puts all machines controlled by non-compliant chips-- say, a widget monitoring water flow into a power plant's boiler or a motor that points a communications satellite's radio dish--on manual. There's one problem, however.

"I get this question every day: 'There must be a manual override,' " Simpson said. "No, there isn't. They've taken manual off everything, because they say it costs too much money. Go down to a filling station, and ask them if they can manually pump gasoline. They will say, 'No.' Unless, of course, you're off in the middle of nowhere. The switches on the railroads don't have a manual switch because it costs too much money.

"So everything is computer controlled--you downsize, you put a machine in there. Ain't life grand? Well, guess what? Thirty years of downsizing, just in time, is coming back to bite you. That's what Year 2000 is all about. It's not about computers. It's about 30 years of neglect and cutting it too thin and getting rid of people."

Simpson also sees the coming Y2K crises as an entirely new experience for a nation unaccustomed to tough breaks. "This is going to be a major wake-up call for this country, especially the younger generations, who've never known hard times," he observed. "A whole one-and-a-half generations have never had shortages. They've never known down times. On Wall Street, most of the brokers have never known down. This is one of the things we're going to have to face. This generation has never known what it's like to have no food. They've never known soup kitchens. They've never known bombing. They've never known cities leveled."

The worst that could happen, he noted, would be if any public panic were to erupt, especially since the banks only keep 1.5 percent cash reserves. "If everyone runs to the bank and takes their money out, the economy will crash. It'll become a self-fulfilling prophecy," Simpson said. "We can't allow people to panic, because it won't serve any purpose at all. It'll be like a herd--and when herds panic, people get trampled."

Simpson gets frustrated with Washington's low level of interest in a problem that could be of the highest importance. "No one is telling the damned truth. They're all playing silly games," he said. "This is not a commercial problem. It's a national security problem. It's a frigging country that's got no power. We're doing at one minute after midnight what Hitler and Yamamoto couldn't do in all the Second World War.

"The CIA has come out with a report which is virtually what I've said in my testimony [before the House of Representatives], which says, 'Hey, we've got problems.' If the communications go down, the security systems go down, the power goes down, this country is bollock naked. We've no defense. That's what we're playing with here."

Still, Simpson said, people should also beware of anyone bearing too many forecasts. Some people may be in a position to make a few educated guesses, but no one has a crystal ball. "You get a lot of bullshit and projections, but we don't know. We don't know how serious this is," he said. "We don't know where the problems are. We don't know which ones have fatal problems that are going to shut everything down--and which ones are just a damned annoyance."

What Y2K activists urge, in any case, is preparedness at the individual and community level. And, since computer records of anything should not be counted on for at least the first few months of 2000, collecting paper records of everthing-- including taxes, bank records, birth certificates, deeds, titles, essential documents, etc.--is strongly urged.

Whatever happens, the big boys and girls will probably be able to look out for themselves quite well. But others down the line may not be so lucky.

"The big banks will survive. AT&T will survive. But farther down the food chain--the small farmers, the small manufacturers, and Joe Public in the lower income brackets--they're going to be out on their own," Simpson said. "The one thing that is recurring is that all the states are looking after their major systems first. But when you get down to the local level like school districts and community hospitals, they've been thrown to the wolves."

It could be only a bumpy road. Or maybe Y2K will bring some regions of the world closer to the equivalent of a (virtual) air raid or the Great(er) Depression or the (new & improved) Tower of Babel. Whatever its reading on the Richter scale, the millennium bug's many aftershocks stand to alter permanently the industrialized world's relationship with technology, the global economy, and the lifestyle that's now practiced in the West.

If, as it seems likely, there will be disruptions come 1/1/2000, some might find, when the amenities of modern life eventually return, that they no longer need the things they once thought they couldn't live without.

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