While the nation ignored the year-2000 computer problem, Mr. Koskinen used his powers of gentle persuasion to raise awareness.
When the nation became frenzied, Mr. Koskinen remained unflappable and urged people not to overreact.
Now Jan. 1 is just 11 days away.
Question: Now that it is getting close to January 1, is your anticipation more like a child’s on Christmas Eve or more like an inmate’s on the eve of his execution?
Answer: I’m not sure I’d describe it either way. It’s like living in a mystery story and you can’t cheat and look at the last page. You turn each page one at a time.
Having put almost two years into this, I think we’re all interested in seeing how this comes out. I’m comfortable in the country’s preparations. I think we are likely to see some problems abroad that will be important to those countries but won’t have a negative effect on us.
So to some extent it is going to be fascinating how it all unfolds. No one can tell you with precision exactly what’s going to happen. Afterwards it may look logical in the way it unfolded, but right now there’s still a wide range of possibilities. I think I’m curious to see how it unfolds.
Q: So do you think you have done all you can to prepare the nation?
A: I spent about 90 percent of my time talking to people who don’t have to listen to us. If I had to do over again, I’d do it pretty much the same way.
We had tremendous cooperation with the private sector and have had a very good working relationship with the states and have created an effective international community of coordinators with over 170 countries sharing information.
Q: Are you interested in moving on to something else? In being done with this?
A: This has been a day-and-night job for two years and you can’t keep doing it that way forever. I’ll be happy in March, after we monitor February 29, to step off the stage.
Q: What will you do after this?
A: I have no idea. I haven’t much time to think about it. I refer to it as trying to figure out what I want to do when I grow up.
Q: Does your wife let you talk about year 2000 at the dinner table, or is that subject banned because she’s tired of it?
A: Actually, I haven’t been home at the dinner table in some time … I get carryout at the White House and I call her and she eats at our dinner table and we talk on the phone, so we have conversations. It’s just two dinner tables.
She’s been very interested in learning about what we’re doing and watching as we execute a range of strategies trying to increase the preparedness of the world. So I think she probably knows as much about Y2K at this point as anybody.
Q: Name a few things you will look for January 1 that others can look for to make sense of the year-2000 computer problem, its effect on us in North America and on the world generally? Give us the insider’s view.
A: Everyone has figured out New Zealand goes into the year 2000 at 6 o’clock in the morning on December 31 [Eastern standard time]. I think of relevance to us will be to watch how the developed countries do. We clearly expect there will be greater risk of difficulties in developing countries because they are less prepared and they started [to address the problem] later.
So I think the thing we’ll all look for is to see how do New Zealand and Australia do? How does Japan do? How do Germany, France and England do?
But even there, the consensus is that the United States is the best-prepared country and if there are problems in some of those countries, they may not have any meaningful impact for us.
But I think the thing to watch will be those developed countries and see how they’ll do. We’ll be monitoring them, trying to determine whether there’s anything going on there that is an early warning for us. If we find anything like that, we’ll obviously advise the public and critical sectors of the economy about anything they need to be aware of.
Q: The federal government spent $50 million for the White House’s year-2000 information center. That’s a lot of money to spend to monitor a single event. What will it be used for after the White House completes year-2000 monitoring in early January?
A: A portion of the funds were used to develop an updated reporting structure for state and local governments to FEMA [the Federal Emergency Management Agency]. That process will remain in place.
The equipment we have that collects all that information will go to an alternate site and be backup equipment for FEMA.
In terms of the structure itself, OMB [Office of Management and Budget] is now reviewing what use should be made of the information center. It obviously is a very attractive backup site for other emergency centers.
Q: What do you make of the conspiracy theorists’ rumor that year-2000 is a manufactured event the federal government created as an excuse to impose martial law and take control of the country?
A: Even paranoids have enemies, but I think the facts have proven that theory wrong. Companies around the world, certainly in the United States, haven’t spent hundreds of millions of dollars as co-conspirators.
They are spending that money because Y2K is a legitimate problem. I think it’s the biggest management challenge the world has faced in 50 years. It’s a problem people have had to fix or their systems would stop.
As we have said on numerous occasions, government is too big to keep any kind of secret like we are about to declare martial law. There are no plans to declare martial law. There are no plans to declare a state of emergency.
Q: But how do you strike a balance between urging people to prepare and not starting a wave of panic? How do you know which buttons to push?
A: That’s been the problem from the start. When I testified in the early spring of 1998, I told Congress that we were going to have just that balancing act.
On the one hand it’s a critical problem people needed to deal with and a lot of people were not paying attention to …
On the other hand we were concerned about gratuitously causing people to overreact and creating a self-fulfilling prophecy of an economic problem. So our strategy has been to call them as we see them to collect as much information as we can …
My theory and experience has been that people have a lot of common sense and they overreact when they don’t have information. So even if the information wasn’t all positive, if people felt we would share all the information with them, that we were organizing a national effort to deal with this, they would then respond appropriately …
As we are urging people, they need to be prepared for a long midwinter weekend and make sure they’ve got flashlights, batteries, battery-powered radios, et cetera.
People have asked me “When are you going to run your public service announcements?” I’ve told them I don’t think people want to hear general bromides from me. They want to know what are the facts. What are the risks? What’s being done about it?
So we’ve spent a lot of time focused on getting information to people, not only nationally, but locally.
What everybody really wants to know is “What’s going to happen to me?” That really depends on their confidence in their own service providers power companies, telephone companies, local governments … There’s a saying, “All politics is local.” I think ultimately all Y2K is local. People want to know “Can I depend on the service providers that I rely on every day?” So our strategy in striking the balance has been to put that information out there and where we have risks or concerns, share that with the public …
Q: You’ve often said the impact of the year-2000 problem will likely be felt for days, weeks or months. Where do you think the late-arriving symptoms will be felt? Which areas of the world and which industries?
A: There are some consultants and others who maintain that the bulk of the Y2K problems will occur throughout all of the year 2000, and I think there will be some of that.
But I think it’s going to fall off … after the first week or two in January and we’ll have a very good idea whether there will be major issues. But it’s clear that even though people have tested their systems … that until you run the first payroll system, until you run the first billing cycle … you’re not going to know whether you’ve tracked through all of your glitches …
The biggest area to monitor will be in developing countries, where power and telecommunications services are not likely to fail immediately on January first … What you’re likely to see in those situations is a gradual degradation over several days. So the lights are probably not going to go out anywhere in the world initially, but what happens is that if you haven’t fixed your system, you begin to lose your ability to manage and monitor that system so it begins to accumulate difficulties that … cause it to shut down.
But that won’t take months. I think by the end of the week, we’ll know whether that’s going on.
Q: What preparations have you made at home?
A: We’re basically following the famous guidelines in our check list, which anyone can get if they call our hotline at 1-888-USA-4-Y2K.
We’ll have three days’ supply of food and water. Like everybody, we have more than three days’ supply of food normally, but we’ll make sure we have water.
My wife every year at Christmas always gives people flashlights and batteries for their cars and houses, so we have more flashlights and batteries as a general matter, and we already have a battery-powered radio.
We’ll make sure that if any of the prescriptions we use are within the five to seven-day period, we have them renewed, which is the advice from pharmaceuticals.
We always keep our financial records. I’m somewhat compulsive, so I always look at my bank statement or credit-card records to see if the transactions are right. It’s surprising to me how many people never open bank statements or look at them, they just put them in a drawer.
I think it is important for people to understand they ought to keep their transaction records bank and credit-card records for the first two or three months next year, and look at them to make sure the transactions are accurately recorded.
The systems are going to be fine, but if there are glitches, one way the financial institutions and credit card companies will know that is if people call and say “The number is wrong” or “The transaction didn’t get recorded correctly.”
Q: You’re somewhat compulsive?
A: Organized. That’s how I spent my career. I enjoy trying to create order out of chaos … When you take over a troubled enterprise that’s in bankruptcy or near bankruptcy or near failure, you’re looking at a chaotic situation, so I enjoy trying to impose order out of that, and to do that you tend to be somewhat compulsive.
Q: What percentage of small companies will have trouble?
A: That’s hard to know. We know of the smallest businesses, those with five employees and fewer, that there are probably several hundred thousand that are going to wait and see.
Once you get businesses above 25 people, 95 percent of those businesses are done or about to be done.
It’s hard to know what a failure for them will look like. Most of them have PCs or voice mail systems or building security systems, any one of which has the risk of failure. The problem with small businesses from the start was we couldn’t guarantee them that everything they use would break.
It would have been easier to get their attention if you said whatever you’re using is going to stop working. But the SBA [Small Business Administration] has done a good job of not having small businesses waste money.
It may be that the computers or the hardware or the software is compliant or if it’s not compliant, it’s on functions they’re not using. But on the other hand, everybody has been updating their voice mail systems, and a lot of small business rely on voice mail to take orders and stay in touch with customers …
I think the most likely area of failure for small businesses are their voice mail system and their point-of-sale devices …
Q: What countries will have the most problem and which countries’ problems are most likely to affect the United States?
A: In light of what we know now, we don’t think the failures abroad are going to affect the economy of the United States because the bulk of our commerce and travel is with developed countries that are doing well.
On the other hand, the problems in developing countries will be significant for anyone relying on those countries … In terms of the countries that are most challenged, they tend to be the countries with enough information technology to get into difficulty. The very developing countries have relatively modest amounts of information technology.
The countries at risk are the ones that have a reasonably large dependence on information technology, but that haven’t had a major effort to deal with it early enough. So, obviously Russia and China are countries that are large that have increasing reliance on information technology and started late.
Some Eastern European countries are in the same situation.
But the hardest area to make predictions is internationally because it’s hard to get detailed, accurate information and it’s hard to know what the impact of failures will be because a lot of those countries have infrastructure failures on a much more regular basis than we do, and they seem to be able to chug along anyway.