By George Ross Fisher, M.D
Most recent articles about the Year-2000 problem (converting two-digit years to explicit four-digit years) predict things are going to be pretty bad at the turn of the century. The problem has been taken seriously, but too late to get it fixed. Instead of complaining about it, let’s ask what each of us can do for self-protection.
1. Make detailed paper records of your financial affairs, as completely as you can. Since you may not be able to rely on any computer, your own or anyone else’s, prepare to do without computers entirely, for two weeks before and two weeks after Jan 1, 2000. Just fill a very large loose-leaf binder with your latest bank statements, brokerage accounts, credit card statements, passport, tax records, mortgage payments, etc., etc. Try to get your records in such condition that you could use them for 1999 tax filings, as of December 1, 1999, and fill a shoebox with anything that arrives during the month of December. If your affairs should escape the chaos of the millennium day, that will be just fine. With paper records, however, you can survive if somebody’s computer doesn’t work. If somebody’s computer does work but creates errors, you may need these paper records for later lawsuits.
2. Start vigorous collection efforts for all your accounts around September 1, 1999, and try to collect every last penny by December 1. For the month of December, a cash-only policy would be a good idea. If you must send insurance claims, print them on paper and save a copy for repeat filing later in the year 2000. In other words, don’t let your claims get caught in whatever year-end chaos may develop. Similarly, if you are paying bills, try to send out payments so that the receipts (on paper) are in your hands by December 15, 1999. If you are really worried, pay no bills after December 1, 1999, until the coast is clear.
3. Figure out what you need in the way of ready cash, and withdraw six weeks worth of obligations in twenty-dollar bills from your bank by December 1, 1999. The Federal Reserve has already anticipated this sort of reaction and has delivered truckloads of currency to its banks. If you don’t maintain that much ready cash in your bank account, you have a year to figure out how to survive the coming period of cash-only economy.
Come to think of it, perhaps eight weeks’ cash requirement is safer, because some of your friends and relatives may well not protect themselves and fall back on you for help. So much cash will put you at some risk of robbery, so place most of it in a safe-deposit box at the bank. The Internal Revenue Service hates a cash economy because it facilitates tax evasion, so keep careful records. You are going to have to pay your employees and buy food, at the least. Remember, New Year’s is usually a rather cold wintry season.
4. If uncertain about your business and home computers, you should plan to buy at least one new high-capacity machine in the summer of 1999. It’s hard to know whether Windows 95 and its related business programs will be year-2000 compliant. Microsoft won’t guarantee it, but of course they are selling replacements, and that uncertainty will sell a lot of Windows 98 products. A fat lot of good it will do you to have their guarantee if the new software doesn’t work, however. One machine with Windows 98 installed would provide some peace of mind, particularly if it contains copies of your business records and its new programs seem to work satisfactorily. But Windows 98 is the latest you should consider. You want to give any product six months to allow time for the inevitable new bugs to surface, before you face the uncertainty of January 1, 2000.
5. Plan to stay home. There are gong to be some major New Year’s parties on December 31, 1999. Very likely, the one in Rio de Janeiro will be the biggest and best, but it doesn’t look too smart to be dependent on the airlines around that time, or even hotels. Exchanging foreign currency at the millennium turnover could be a very big problem. Maybe it’s hysterical to store up candles and casks of drinking water, but it sure would be a prudent idea to have all gasoline and fuel oil tanks full to the top. A full freezer and kitchen shelves of canned goods could save you some anxiety. I lived through the 1936 flood in Pittsburgh, and learned a lesson I won’t forget about sudden loss of essential services.
Now, let’s reflect for a moment on what could happen to the national economy if a lot of people actually act upon the sort of advice I have just given. It may not matter whether computers work or not, so long as a lot of people distrust them. It does seem likely that most big organizations will have their problems fixed by next year. Those who fail to do so will be able to predict shutdowns in advance, and therefore most computer crises that actually happen will be totally unanticipated, local and brief. Most of them can be corrected by paying out unbudgeted sums to replace old software with new. After that, there may be a lot of unemployed computer programmers.
But if thousands or millions of people draw out large sums of cash, there could be bank collapses. Every bank has two classes of creditors for the same money: the borrowers and the depositors. Banks survive on the law of averages keeping everybody from demanding cash at the same time. Even if the Federal Reserve can cover these cash shortages, you can’t be sure of the corresponding banks in, say, Bolivia. American banks could be in sudden trouble if foreign lending systems get tangled up, and indeed that could happen in Japan and Russia without any millennium trouble. After all, if everyone starts to hold up the payment of bills until the crisis is over, somebody is going to need to take out some big loans. Sure. From whom?