Oral testimony from the U.S. Senate Community Y2K Preparedness Hearing, May 25, 1999: A Work in Progress:

5/25/99

For those of you who are just checking in on this very busy news day (with the Cox report coming out, and this long-awaited Y2k Senate hearing occurring on the same day) you may be wondering just what was said at this Senate Y2k hearing.

Todays Senate hearing on Y2k featured two panels. The first panel represented individual and community preparedness advocates. The second panel included representatives from the news media.

I watched and taped the entire hearing and began to transcribe it, when other diggers on this forum (most notably Diane Squire and Ron Rodgers) came up with links to the Full-Text Witness Statements and the video archive of the Senate Y2k Committee testimony. Both links can be found on the Senate Central Thread.

As I understand it, the Full-Text Witness Statements are the written statements submitted to the Senate committee. However, they differ from the oral testimony and do not include the live interaction that took place, most notably the question and answer sessions following both panels. The video includes the live interaction, but its two hours long.

Regardless, because I knew that these links were available, at one point today, I wondered whether I should continue with this synopsis/transcription effort. I was encouraged to do so, by many of you who want a record of both the oral and the written statements.

I will do so. But--as I posted on another thread--(the Cheerleading Squad thread) it would be extremely helpful to my family now if you would be willing to help me justify the cost of this work (which is taking away from prospecting for new clients for my business as well as helping my husband with a struggling start-up) if you, or those with whom you share this, will send a dollar, or ten, or a MILLION (hee hee) with tomorrows mail, at the address posted below. Let your conscience be your guide as to the amount. I would also appreciate it if you would let others know about this work in progress through your own network of contacts, and advise them that their financial help would be also be most appreciated.

As some of you know, or may have suspected, I'm a former reporter. Without saying too much about myself (I've been as famous as I ever want to be, and value my privacy), Jim Adams' Senate hearing comments today regarding the shift of television news toward "entertainment" rang very true with me--one reason I decided to end a very promising career. I am telling you this so that if you share this work with anyone, you can correctly tell him/her that this synopsis/transcript is the work of a former television news reporter who spent many years covering politics on a national and local level. All true.

That said, my mailing information is as follows (and I do take checks):

SCI Publications 5694 Plymouth Road, Suite 290 Ann Arbor, Michigan 48105

Thank you all in advance. With two hours of testimony to grind through, this is going to take some time. Encouragement in the form of monetary and verbal good will offerings will be most appreciated.

In short, Keep up the Cheering! Spread the Word! Get those bills and checks in the mail to keep the husband happy! (Hee hee. . )

God bless and thank you in advance. I promise Ill do my best for you. Keep checking this thread. Ill post sections as I complete them, and when its all done, Ill wrap it up in a pretty package on a different thread.

Please visit Cheerleading Squad Thread if youd like to offer words of encouragement. You can find it at:

http://www.greenspun.com/bboard/q-and-a-fetch-msg.tcl?msg_id=000s2R

And--as usual--please dont post here until Im finished. Here goes:

:)

Synopsis and Partial transcripts (Verbatim statements are in quotes--everything else is a synopsis.)

U.S. Senate Special Committee on the Year 2000 Technology Problem

United States Senate

"Community Y2K Preparedness: Is There News They Can Use?"

May 25, 1999

10:00 a.m.

216 Senate Hart Office Building

Opening statement by Senator Robert Bennett:

In his opening statement, Bennett said, Perception is reality. Reality is Perception. Therefore were focusing on Y2k preparedness and the news media, which in this country creates the perception.

Bennett talked about the importance of news media, says the challenge to be probed in the hearing is Whether or not the news media treatment of Y2k will create a bigger crisis than the computer problem. He said people need to be informed of the reality of the problem without creating panic. He questioned how we can walk the line of keeping people informed without panicking them. He referred to the Boy Scout motto of being prepared, indicating the motto has served us well in many areas of life: extra food in the house for guests, flashlights if we lose electricity, buying insurance, etc. Bennett said, These are not considered panic activities, but when we talk about Y2k and say lets take some insurance policies or make some contingencies, then sometimes we get accused of being panicked. So those are the areas were going to explore today. What can the press do, what has the press done with respect to Y2k that can have people get ready to take appropriate contingency plans, or has the press gone too far the other way and caused a situation with respect to panic. Bennett indicated his prepared statement contains more of his views on this subject but this introductory statement summarizes his view.

Bennett then introduced an ex-officio member of the committee, Senator Ted Stevens of Alaska. He paid tribute to him for attending so many meetings, and said without his efforts the federal government wouldnt be as ready as it is, because Stevens facilitated necessary appropriations.

Stevens spoke only briefly, stating he wanted to hear from the panel.

Bennett then introduced the first panel; Ed Yourdon, a noted software engineer, co-author of two best-selling books with respect to Y2k, Timebomb 2000, and The Complete Y2k Home Preparation Guide, Mrs. Paloma O'Riley, shes Co-founder and Director of Research for Cassandra Project organization focused on Y2k community preparedness. For those who are not up to date on their Greek mythology, Cassandra was the figure who was always predicting disaster and was never believed--and who was always right. So thats an interesting choice of name for this particular project. Then well hear from Ms. Liza Christian, whos the former Executive Director of the Rogue Valley, Oregon Y2K Task Force, a community-based Y2k preparedness group, and Mr.Michael Nolan, who is City Administrator of Norfolk, Nebraska , which has made Y2k conversion and preparation its highest priority, and finally, Miss Cathy Hotka, Vice-President, Information Technology with the National Retail Federation. So, Mr. Yourdon, we will start with you.

Testimony of Edward Yourdon

Thank you, Mr. Chairman. My name is Ed Yourdon. Ive worked in the computer field for some 35 years and have written 25 books on computer technology, including two on Y2k. But Im not here today as a computer professional, Im here as a father and a son, and a husband and a brother who takes the personal safety and responsibility of his family very seriously.

Mr. Chairman, my father lives in your state of Utah, and he would have a lot to worry about with Y2k were it not for the fact that he is surrounded by friends and neighbors whose religion has encouraged them to prepare for emergencies long before Y2k came along. So hes not panicking about any of this nor are his neighbors, and all I would ask of you Mr. Chairman is that uh, you have legitimized this whole concept of preparedness so the nation can benefit from the same leadership that youve given your state over the years.

My mother lives in Senator Edwards state of North Carolina and she has more at stake with Y2k, partly because shes dependent on Social Security, but also because it seems that her friends and neighbors are oblivious of Y2k. Shes not panicking, but I worry that perhaps her neighbors might if Y2k turns out to be more than just a bump in the road, and what I would ask of Senator Edwards is that he encourage the private sector and public sector organizations in his state to make a full disclosure of the Y2k risks that they all face, so that they can all make their own decisions.

My wife attended college with Senator Dodds sister as it turns out, and some 35 years later, after working with me in the computer field, my wife now has rheumatoid arthritis. I dont need to belabor the risks that she faces if theres a disruption in medical supplies. Shes not panicking either, but she doesnt really believe the rather glib reports that she reads from computer illiterate computer journalists, uh newspaper journalists that tell her theres nothing to worry about. And what I would ask of Senator Dodd if he were here (Note: Dodd wasnt present for beginning of hearing), is that he might want to remind his fellow Democrat Mr. Gore that hes been missing in action on this Y2k problem, and he might come to regret it in the election next year.

One of my sons attended college in Senator Collins state of Maine during the January 1998 ice storm, where 750 thousand citizens ended up without power for a month, so I dont need to explain to my son what the stakes are, if theres a mid Winter power outage, even if it is localized. Fortunately he graduated two days ago and hes now on his way to Arizona, to Senator Kyls state for graduate school, so the stakes no longer involve freezing. On the other hand, until he finds out whether his community is aware and prepared, my personal plans have to take into account that he may be spending a long time in my house after New Years Eve. And I would suggest to Senator Kyl that he might want to remind his fellow Republicans that perhaps a dark horse presidential candidate may take Y2k as the hot button issue for the election next year.

And Senator Stevens, one of my sisters lives in your home state of Alaska, in a small town that quite fortunately for me is very much aware of Y2k and is making its own plans and informing its citizens and taking responsibility for its own actions (inaudible), as many small towns in Alaska do, given their distance from the mainland. So, I have no worries about her.

And Senator Smith from Oregon is probably the only one of your whole panel for whom I have no family members to worry about (laughter from audience). I do have friends there, but theyre all adults and they all work in the computer field and I think they can probably figure out the stakes for themselves.

In fact, I would suggest that all of us can determine the Y2k stakes on our own, but I think it is important that we do not confuse stakes and risks.

If somebody tells me that 99% of all automobile accidents are mere fender benders, and that therefore I dont have to wear seatbelts, I would respectfully disagree, because the stakes are too high.

I dont hold this committee responsible for helping us determine the stakes, but I would hold this committee responsible-along with the rest of government-if it were to misrepresent or withhold information about the Y2k risks, because then, neither my community nor my family, nor I can make appropriate plans for coping with Y2k.

If you believe as I do, that Americans can cope with life and death issues, like Kosovo,then I think you must also believe that we can cope with potential life and death issues of Y2k.

Certainly its not the first time weve faced a crisis-in fact the very creation of this country was a crisis-and my plea for full Y2k disclosures was echoed very eloquently I think by Patrick Henry in a speech that he gave on March 23, 1775, where he said, Its natural for man to indulge in illusions of hope. Were apt to shut our eyes against the painful truth and to listen to the song of that siren so she transforms us into beasts. For my part, whatever anguish of spirit it may cause, Im willing to know the whole truth; to know the worst, and to provide for it. Thank you Mr. Chairman.

Bennett: (to Yourdon) Thank you very much. Were amazed that youre so well connected. You mind end up running for President yourself. (laughter from audience) Ms. O'Riley?

Paloma O'Riley, Co-founder and Director of Research, Cassandra Project:

ORiley thanked Senators for the work theyve done over the past two years raising awareness and addressing the concerns community preparedness organizers have. She told them shes a former Alaskan, recently visited the state to discuss community preparedness and is happy to report that many Alaskan communities are doing well.

ORiley then said, Actually Y2k presents a situation of unprecedented dimensions, implications and challenges, and the one indisputable fact about Y2K is that we dont know whats gonna happen. There could be a few minor problems, there could be several serious problems, but its because we dont know, that individuals and communities should be developing emergency contingency plans. After all, we dont need proof that our house is going to burn down before we buy home insurance, and we dont need to have proof that were going to have a car accident before we have car insurance. We do these things just in case we have problems.

As Senator John Glenn said recently, The greatest antidote to worry, whether you're getting ready for a space flight or facing a problem in daily life, is preparation. The more you prepare, the more you study, the more you think, the more you try to envision what might happen and what your best response and options are, the more you are able to allay your fears about the future, and thats probably the most important thing. If you are afraid of whats coming, the best antidote to fear is simply by taking precautions.

Calls for preparedness for Y2k being ignored primarily because theres a lot of Y2k happy talk coming from the government and city and businesses and institutions.

(More to come)

-- FM (vidprof@aol.com), May 25, 1999

Answers

Paloma O'Riley (Continued):

And happy talk is designed --includes fervent assurances that everything is going to be fine, and then very offhandedly, almost in a legal-like disclaimer sort of way, is added that maybe we should do a bit of preparedness. And happy talk is designed to lessen anxiety among the general public about Y2k, supposedly to prevent this so called panic, and when I asked a lot of people who keep using panic as an excuse what they mean by that, they keep saying things like, people are going to pull their money out of the bank, or that theyre going to sell off all their stock.

Unfortunately, my definition of panic is a little different and it includes civil unrest, accidents, etc. But unfortunately, with very few exceptions and fortunately (to the committee) you are one of the exceptions, the primary concern seems not for our families health and safety, but with not rocking todays economic boat. That is, we dont want to talk about Y2k, because we dont want to have any kind of negative impact on the economy.

Historical data proves that panic only occurs when people feel they are out of options, or are being given misleading and conflicting information. We have not--in the last two years weve been working on this--and will not have panic, if people are given information and guidance before the event, far enough in advance so that they can actually do something about it, not at the last minute.

Unfortunately,happy talk is creating a false sense of security, which makes it very difficult for community organizers like myself, and Liza and many others around the country to actually have an effect in our community,because they keep being told that everythings going to be fine, So I dont need you people standing on my doorstep saying I need to do some preparedness.

And the media, of course, is compounding the problem. And they appear to be schizophrenic. They have no clear position on the issue. The same organization can and often does run widely divergent stories on Y2k--sometimes in the same issue. And reporters paint local organizers as extremists, alarmists or worst. Conflicting stories on preparedness efforts has a definite quelling effects. Its hampering progress and causing many to give up the effort, and adds to the general level of confusion, skepticism and denial.

But the benefits of community contingency planning cant be overemphasized. Neighbors are learning that they can pool resources to help themselves and each other. Communities have discovered that preparedness efforts are creating new and productive relationships between neighborhoods, emergency services, local business and government. Whether Y2k occurs or not, the time and effort invested in contingency planning is not in vain. The self reliance, self confidence and rediscovered sense of community are a few of the gifts and benefits of doing individual and community preparedness.

Many times the president and vice president have been asked to come forward to provide leadership, and were calling on them again today. Their current plan, however, is to issue hollow reassurance and respond with money and resources to fix Y2k problems after they occur. This White Knight approach is quite frankly, self-serving and an act of cowardice, and an abdication of the responsibility for the people. It abandons us in a time of genuine need for leadership and guidance. Thank you.

Senator Bennett: Thank you very much. Weve been joined by Senator Dodd, do you have an opening statement before we go on?

Senator Dodd: I do Mr. Chairman, but I dont want to delay things here. Let me just ask, and Ill consent to include the uh, remarks in the record, again, I think this is a very worthwhile hearing to have to look at how we can increase civic preparedness for this issue.

Its a very difficult job. The Chairman has done such a wonderful job on this issue over the last several years--the last 13 months the committees been in existence, and trying to strike that balance, where we find, weve all found that as we try to describe the events that could occur, you get blamed if youre going too far. If you say its going to be too much, then youre scaring people, and thats not an illegitimate concern. Or if you dont say enough about it, then youre underestimating the problem.

Weve called it as preparing for a good storm. The difference is today, with satellites and radars we can predict storms with a high degree of accuracy, and this one here--its like a storm of a hundred years ago or less, where we know theres a storm coming, we think its pretty bad, but we dont have our --we cant really say how bad. And so it puts us in an awkward position, all of us who are concerned about this. And to that extent this hearing today I think is helpful in raising the level of awareness.

Let me just say, I have great respect for the people in the media trying to report this issue, because theyre trying to strike that balance as well, uh, to see to it that we raise that level of awareness, and were going to hear from some of them shortly.

In fact, Mr. Chairman, theres also these kits now that--you know the Community Conversations that are being put out--by the Committee, this is the Presidents--these things going to various community groups across the country, its a package of materials and so forth, to try and help. The things that people can do, the kinds of steps they can take, and we certainly applaud them for those kinds of efforts. We think thats the right direction to be going in, and your testimony here today is helpful as well, so Ill submit the statement.

Senator Bennett: Thank you very much. Ms. Christian?

(More to come)

-- FM (vidprof@aol.com), May 26, 1999.

Statement of Liza Christian, Former Executive Director Rogue Valley, Oregon Y2K Task Force

Senator Bennett, and distinguished members of the Senate Special Committee, thank you for inviting me to todays hearing. Its an honor to sit before you, and I bring you greetings from the great state of Oregon and the beautiful Rogue Valley.

My statement as well as the written testimony that will be entered into the record today is not exclusively my own but reflects the voices of many colleagues in the preparedness effort.

As you know, the nature of the Year 2000 problem is complex and challenging and its remediation a formidable task. Many view Y2k as a confusing maze of conflicting data. But the question that consistently arises to the top is always straightforward, Is it a problem, or not?

In part, the confusion stems from what is perceived at the grassroots level as an orchestrated public relations campaign designed to tranquilize the American public.

Why? we ask. The reasoning offered is if you provide full disclosure people will act irrationally and panic, and the country will suffer an economic and banking collapse.

While we agree that some positive statements about Y2k progress are grounded in fact, others seem like window dressing. We submit that such misleading and artificial restraint will breed an even worse panic later; that adequate preparation prevents panic.

In a March statement by you Senator Bennett and Dodd, we read Y2k is one of the most serious and potentially devastating events this nation has ever encountered. It deserves our top priority. Make no mistake, this problem will affect us all.

And from John Koskinen, Chair of the Presidents Council on Year 2000 Conversion, I urge you to treat this matter with a sense of urgency. Time is of the essence.

Yet, in other sets of quotes we read, All is well, dont worry, we have it under control, business as usual.

An urgency to prepare, but dont worry, be happy? Isnt that an oxymoron? One statement cancels the other and the result is procrastination, and the population is once again lulled into a false sense of security.

As youre aware, many people are scared--some even despairing. They dont comprehend the complexities of Y2k and theres no frame of reference, no historic precedent from which they can comfortably or reasonably examine this issue.

What they dont understand, they tend to ignore. In spite of some progress toward preparation, the pendulum unmistakably swings toward denial, apathy and complacence. As this attitude rises, so does the potential for hardship.

The media, in our opinion, has done a less than adequate job of creating Y2k awareness, let alone fully examining and reporting on the potential impact to every area of our lives.

Where is the investigative journalism? Did they read the recent 164 page report of the U.S. Senate? Doubtful. Instead they merely echo that bump in the road bias.

In our experience, the media is looking for soundbites and headlines. Articles and interviews often ridicule those who choose to make preparations to survive a hardship or crisis. Theyre labeled doomsayer, wacko, alarmist, nut case. At times the media have appeared even hostile or outright disinterested.

We would ask, How does it serve anyones best interest for people to be ill-prepared?

As a nation we must form an effective way to help citizens prepare. The risks of Y2k related failure and the benefit of individual and community preparedness justify a rigorous approach. We cannot afford the luxury of skewed rhetoric.

In my short time remaining this morning, Id like to suggest eleven ideas to help mobilize such an effort:

(1) Advocate for federal, state, county and city governments to martial every resource at their disposal to lighten the burden of emergency preparedness in the struggle (unintelligible wording) . . .of our nations history.

(2) Encourage investigative journalism on the part of the media. Look for proof. Verify facts. Report obvious statistical manipulation and partner with community agencies and efforts aimed at preparedness.

(3) Encourage individuals and communities to become proactive, not reactive.

(4) Join the Rogue Valley mayors in their proclamation for National Awareness and Preparedness Month during September of 1999.

(5) Support informational and educational awareness campaigns.

(6) Establish effective neighbor-to-neighbor strategies that engender a genuine sense of caring.

(7) Advocate for a robust network of serviceable shelters for times of emergency.

(8) Take advantage of the experts from disaster relief agencies and emergency preparedness agencies, to institutions that provide first aid training, etc.

(9) Form coalitions and partnerships with civic and religious organizations and develop targeted and strategic contingency planning.

(10) Enlist every government agency and business to provide full disclosure to the American people

(11) And lastly, call upon every member of Congress to hold town hall meetings to educate and inform their constituents.

It takes unusual courage to act in the midst of adversity. It takes vision and exceptional leadership to act before the crisis arrives.

This concludes my remarks and I thank you for your willingness to consider the voice of the grassroots organizations. It has been my privilege to speak on their behalf.

Senator Bennett: Thank you very much. Mr. Nolan?

(More to come)

-- FM (vidprof@aol.com), May 26, 1999.

Statement by Michael Nolan City Administrator Norfolk, Nebraska

Senator Bennett, Senator Dodd, Senator Stevens, thank you for inviting me to participate in this. I really appreciate the topic because I can kind of identify, Senator Bennett, with some of what youve been through here recently, as far as being a victim of the news media, in what the Jack Anderson situation created for you.

I experienced one of those myself a few months back. Last Summer we had a strike at one of our meat packing plants and the police department was unprepared for it, so after it concluded--and the plant in fact ended up closing--they applied for a federal grant that was leveraged at about 10 to 1, and at the public hearing, as they were explaining to the elected officials why it was that we needed to have some equipment that included night surveillance equipment and shields and whatever riot equipment, because the situation had become a little tenuous--and it kind of, could have gotten out of hand--they inadvertently, and in retrospect they wish they had not, mentioned Y2k as one of the reasons why we needed to add this equipment. And of course, that was the thing that the local news media focused on, and it ended up hitting the wire and became a national story that took us about three or four weeks to do the damage control on.

The reason I emphasize that is because I think that if I look at where the press has failed,they have in many respects not paid attention to the real substance of what Y2k creates as far as potential peril, and have focused on those things, like Time Magazine did, that sort of tend to identify those who have concerns about Y2k with the apocalyptic fringe, and I think thats really a regrettable thing.

We have about 221 days left, and once you extract the weekends and the holidays and all of the time when nobodys going to be working on Y2k. . .

(At this point Senator Bennett interjects, 220, 13 hours, 28 minutes and 59 seconds." Audience laughs.)

Nolan: I mark the days, Senator, but I think once you take away all of that down time, we actually have about 137 days left, which I hope we use wisely, because I think were going to need it.

My community took this seriously--I should say our mayor and city council and our staff took it seriously. Were as prepared as, I think, any place in the United States. I dont know if thats enough. One of the things that weve done is to make sure that our water system--even without electricity--if we didnt have electricity for three weeks, we could still produce 3 million gallons of treated water a day for our citizens. Our usual average is about 4 million.

Having said that, we have a lot--I think--of remaining work to do, and its going to be more difficult to do because the news media has treated this issue more matter of factly than they ought have.

Ill give you an example of stuff that I see all the time. I just downloaded this last night. This is kind of a scary thing. A quotation from a fellow named Donald Rose whos the General Manager for Intel. Hes commenting on the state of preparedness of Intels supplier relationships, and he says, Last year Intel sent out Y2k surveys to its Japanese suppliers to gauge compliance procedures followed by on-site audits of its suppliers, a process that lasted until early in the second quarter of this year. In contrast to much of the feedback given to me from the surveys, the company discovered that two-thirds of its suppliers had an extreme risk to the Y2k bug. It was worse than any geographic region of the world, Rose said, The biggest single finding of our suppliers in Japan was that they were in a terrible state and most did not start a program and if they did it was totally inadequate. It was almost as if they were looking for reasons not to do anything.

And that kind of stuff is on the Internet all the time and I dont think the vast majority of Americans are even paying attention to it. Do we have an infrastructure exposure? I think we do. I mean, theres a lack of alignment among the NERC and a lot of other groups. Fundamentally, I think what this comes down to is--and Ill close here quickly--is that we really need to have, from the Congress and from the President, legitimacy about this issue so that localities will take it seriously and plan for it.

What is needed more than anything else, at this time, is a standard of leadership that rises to stewardship.

Thank you very much.

Senator Dodd: Before we go to the next witness, I just want the record to indicate I appreciate your comments and I gather that all of the panel would appreciate that if it had not been for Bob Bennett insisting that there be this committee, I dont know who youd even be talking to today. And so I appreciate your comments about leadership. Thats always necessary, but one thing weve had from the Senator from Utah is leadership on this issue, in insisting that the Senate of the United States have a forum where the ideas and focus and suggestions on how we be best prepared to grapple with this issue be held. And I must say, in the case of John Koskinen as well too, it may have come a little later than Bob Bennett and I would have liked, but we had a hard time getting anybody to pay attention to this issue a couple of years ago, and the fact the Administration did appoint a Czar--(Question to Bennett) what was it about 13 months ago?

Senator Bennett: About a year.

Senator Dodd: About a year or so ago. It should have happened earlier than that, but frankly as all of you will recall, how difficult it was to get anyone to pay any attention to this issue at all! So, I hear you and youre right, we dont have 220 days weve got less than that time left, but were gonna proceed---but I wanted to before we got to Cathy--just to, uh, it isnt a direct response to you Mr. Nolan, but the general notion that theres a lack of leadership, I can tell you in the United States Senate theres been leadership and youre looking at it in the person of Bob Bennett of Utah

(Unknown voice): Appreciate this Senator

Senator Bennett: Well I appreciate it too, and I have to respond by saying that Senator Dodd has been in this right from the very beginning. I remember the first hearing we held was a subcommittee of the Banking Committee. Senator Dodd stayed for the whole hearing. You understand how unusual that is? (Audience laughter) When youre not the Chairman. . .and he said at the end of the hearing, Mr. Chairman, we need another hearing. This is scary stuff. 

And weve been partners in this all the way from the beginning, and I have to say that the record will show that the first member Congress who wrote the President and said, You need to do something about this was Pat Moynihan, before either you or I knew anything about this, Senator Moynihan was pushing for that. Well, I thank the Senator for his kind words. Miss Hotka, well go to you now.

(More to come)

-- FM (vidprof@aol.com), May 26, 1999.

Statement of Cathy Hotka, Vice-President, Information Technology National Retail Federation

Thank you sir. Chairman Bennett and Vice-Chairman Dodd, good morning. My names Cathy Hotka, Im Vice-President of Information Technology for the National Retail Federation. We also are extremely grateful for the continuing leadership that you all have exhibited and weve enjoyed working with your staff for some time now and I appreciate the opportunity to come and testify today, echo what my colleagues have said, and provide a slightly different perspective from that of retailers.

As background, the National Retail Federation is the worlds largest retail trade association. NRF members represent an industry that encompasses more than 1.4 million U.S. retail establishments. If Americans are going to stock up for Y2k, theyre going to do it from our members.

Since early 1997, NRF has sponsored near monthly meetings of the Survival 2000 Project Committee, made up of 140 retail industry I.T. specialists, internal auditors, attorneys and logistics people, who have examined every aspect of corporate Y2k preparedness.

Retailers have invested millions of dollars--in fact we think its close to a billion--countless person hours on assessment, remediation and testing. Through NRF weve surveyed a hundred thousand manufacturers, conducted electronic document interchange tests with ninety three hundred trading partners, spoken with utilities, phone companies,transportation, government and conducted extensive industry awareness activities.

Most large retailers are in the process of conducting on-site visits with top suppliers.

As a result of this work, most retailers are confident that operations will be largely unaffected by Y2k.

We anticipate that occasional inconveniences will occur after the first of the year, particularly for smaller retailers who may not have been working for the length of time that the larger ones have.

But based on two years of risk assessment and close work with members, NRF is confident that larger domestic retail firms have taken the necessary steps to insure a successful transition.

In addition we think that while small companies may experience problems, they can probably go manual, and remain in operation that way. So stores will be open. We will be open January 1, we will be open January 2 and on. Merchandise will be available. Customers will be able to use the payment vehicle of their choice. Theres plenty more in store.

Now having said that, as Paloma mentioned, we have endorsed the Red Crosss recommendation that people have extra food in the house. We know that there are people who dont keep any food in the house because they eat out. We think they should have food in the house.

We think they should buy extra supplies--early. Now. Were worried that they may wait until December. Long lines in stores could cause the panic we seek to dispel.

Is the public buying products they may need later? Today, most retailers dont report seeing stock-up shopping for general purpose items like food and paper products. Most retailers generally arent seeing a market for these products yet.

They are also worried about advertising them. We realize that we could evoke panic by making a big deal of Y2k. Imagine the reaction, if the color coupons that folks receive in the Sunday paper contain an invitation to buy disaster supplies!

In addition, were sensitive to the fact that if people purchase non-perishable items they wind up not needing--water purification units, freeze-dried meals,they may want to return them if theyre not needed.

Retailers remain in business by selling customers the items they would like to purchase.

But future demand for Y2k related stock-up products is unknown. Will the print media retain a constructive tone? Will network news programs give the impression that everyone is building underground shelters? Will the Y2k movie have an impact? Are certain segments of the population more vulnerable to fear-mongering? The publics demand for supplies, and retailers ability to stock products in unknown quantities is largely dependent on factors beyond our control.

In addition, manufacturers generally make the number of products they think theyll sell. They dont know what the market is for this year. As a result, if consumers overreact at the end of the year, there could be spot shortages of certain items.

These are 1999 issues, however, and they dont affect what could happen after the first of the year.

So retailers, in short, are concerned about the holiday season. Wed like you to go out and buy CDs and scarves and not necessarily--just buy a gun.

So Id like to thank you for the opportunity to present this testimony today, and Id be happy to respond to any questions.

(More to Come)

-- FM (vidprof@aol.com), May 26, 1999.

Senator Bennett: Thank you very much, all of you. I hope were now stimulating conversation back and forth in the panel. One of the questions I am always asked is,Well, what are YOU gonna do?

And, Miss Hotka, Ill take advantage of your testimony to say that I have already purchased a 55 gallon drum which I will fill with water, long before the end of the year, so I wont have to be out there purchasing emergency supplies at the end. My wife will see to it that we fill the drum. Right now its empty, and thats probably not a good thing for me, I should have some extra water on hand.

Mr. Yourdon, you referred to the fact that the religious group I belong to has long preached emergency supplies. I will tell you that while we were living in Los Angeles, my neighbors came over and said they were destitute because they couldnt get a cup of coffee. We dont drink coffee, but we provided them with the water they needed to go back to their own house and brew a cup. And I think the Red Cross guidelines for any kind of emergency are good guidelines, whether the emergency is Y2k, or an ice-storm, or a truck strike, or an earthquake, or whatever it might be.

Id like to make a comment about balance in the press. We have examples around here in the charts that weve put up. Some good coverage and some bad coverage.

If I may, not wanting to single out any particular publication, but heres a newspaper story over here about Y2k. It appeared in the Washington Post: Bug Talk on the Block, and when you read that, its very responsible in talking about community preparedness, the kind of thing that youre talking about here on the panel that needs to be done, the community getting together and talking on the block as to what we do. By comparison, The Potomac News has a picture: Y2k Riot Training, as if they are expecting a riot and tear gas and batons and all of the rest of this. . this picture is not particularly helpful in helping people get ready for the kind of community preparedness that they need.

We are starting to say, out of the committee, if you stockpile anything, stockpile information. Get all the information that you can.

One of the things that Im saying that fortunately got picked up on 60 Minutes last night (Editors note: Actual broadcast date was 5/23/99)--youre never quite sure when you have an interview what the interviewer is gonna edit in and out--I say, Yes, it looks as if overall, the country is gonna come through this in pretty good shape, and that will be of no comfort whatsoever to you if you live in the community that doesnt. And when people say to me, Well where is that community going to be? I tell you I dont know. And I dont know anybody who does. If I did, Id tell you.

But youve focused, Mr. Nolan, on the fact that Intel has discovered problems with their suppliers in Japan. Now, for many Americans that doesnt make any difference at all. But if you work for Intel and the particular item that youre concerned about comes from Japan, that makes a great deal of difference.

So I share with you the speech that I give automatically, I say, Dont depend on the United States Senate to solve your problem for you. Take charge of your own Y2k problem and ask the questions where you live. Again, no comfort to you if the national power grid is up, but your power company is down.

I gave this speech in a rural Utah town--standard exhortation--I said, Take charge of your Y2k problem yourself. Check with the local bank where you bank. Its of no comfort to you if I tell you the national banking system is going to work, if your bank doesnt work. Call the mayor. Find out if your water purification system is gonna work, and so on.

After the meeting was over, a fellow came up to me, introduced himself and he said, Im the mayor. (Audience laughter)

I said, Well, youre getting a lot of phone calls tomorrow, and he said, Yeah!

I said, Is the water purification plant in this city gonna work? He said, I dont have the slightest idea, but Im going to find out!

And that of course is the message. Dont depend on a national assessment of where were going to be. Focus on your community and your situation and your lifetime.

Theres been some criticism--I guess its probably justified--that at one point I did use the phrase, Weve now solved this to the extent that nationally, its going to be a bump in the road, and somebody said, How can you say that in view of the other comments youve made?

A member of the staff saved me. He said, How bad a bump in the road is, depends on what youre driving. If you hit a bump in the road in a small two seater sports vehicle at 60 miles per hour, it can throw you out of the seat and into the side of the road and can produce very serious injury. On the other hand, if youre going over a bump in the road in an 18 wheeler, at maybe 30 miles an hour, you dont notice it that much. So each of you must take charge of your own Y2k situation and see how you survive where we are.

All right, with that much of a comment, lets have first--any reactions that any of you might have to any of the other things youve heard from the panel. Is anyone burning with a comment or a correction that you want to make to your fellow panelists?

(More to come)

:)

-- FM (vidprof@aol.com), May 26, 1999.

Michael Nolan, City Administrator, Norfolk, Nebraska:

Well sir, Id just like to respond a little bit to Senator Dodds comment. I hope that I didnt imply anything, finger-pointing at you or the Committee.

(Unknown voice--could be Bennett): We compliment each other all the time in Congress. (Laughter)

Senator Bennett: I am grateful for the Senators comment, but Im sure there was no misunderstanding.

Nolan: I think most of us would agree here that the leadership that has come from Washington--this committee is responsible for a great deal of it. There has been some misalignment between the Executive and the Congress and between the various agencies that continues, I think, to create part of the problem about people taking us seriously. The recent GAO (General Accounting Office) report contradicts what the NERC (North American Electric Reliability Council) has said, and I think a lot of the Internet Community tends to rally around the GAO (unintelligible) the state of the electric industry, so part of the frustration were feeling when we say lack of leadership is also lack of convergence on 'What is the official position of the seriousness of this, that comes from the Federal Government?' There doesnt appear to be any alignment, any convergence of opinion.

Senator Bennett: Im glad to have you raise that. Let me comment on that from two perspectives:

We on this Committee use the GAO very heavily. You read our report, youll see there is a convergence because the GAO is officially an arm of the Congress, not of the Executive Branch and thereby has a degree of independence that some other agencies might not have.

Two experiences with the GAO:

In one of my other assignments as Chairman of the Subcommittee on the Legislative Branch Appropriations, I held a hearing of the various agencies under our responsibility and exposed a wide divergence between what that agency was reporting and what GAO was saying, and the head of the agency after being embarrassed by my asking the questions from the GAO perspective, said, I want to get us all in the same room, because we think were doing fine. We think our testimony is valid and its embarrassing for me to come before your subcommittee and have you quote the GAO to say were doing very badly. And we wanna all get in the same room.

And so, we did that. I had him and I had the head of GAO come to my office, and we sat there and they talked it through and the convergence was more in language than it was in understanding where they really were. They were using a definition of compliant that the GAO would not accept as compliant. The GAO was insisting that there be a higher degree of testing before they would certify them as compliant, but there was agreement as to what had been done.

And the one agency said, Well, we have remediated this. And GAO said, No you havent, until the testing is completed to this point. Agency response) Well we agree that the testing has to be done, but will you agree that we have fixed things up to this point? GAO said, Well, yeah. We will agree that you have done that amount of remediation, but WE dont accept that as remediation. And so on and so forth. And thats one of the problems the media has when they report where we are on this, because they will call an agency and then theyll say, No you are not or yes you are, and so on.

So that ones the first one. The second one, I just came from a breakfast over at the Pentagon, with Secretary Cohen and Deputy Secretary Hamre. The issue was Kosovo, but I cant go anywhere these days where Y2k doesnt come up. And we were talking about it, and Secretary Cohen said, We think GAO has been slow in their reporting. That is, the GAO reports are accurate, but they are three months behind where we are, and they need to come around and do a next assessment.

GAO is now beginning to say kinder things about the Defense Department than they did before, and the Defense Departments saying, Theyre just catching up to what we have been doing.

And that again reflects the problem that the media have, as to where we are.

The difficult problem with this challenge is that it IS a moving target. Ive had the experience of having my old speeches quoted back to me, and saying, How can you say this is where we are, when six months ago you said. . . And I said, Because six months ago that was true, and what Im saying now is true.

Unfortunately, many people get disappointed when you tell them things are going well. They kind of want this to be the end of the world as we know it. And when you say, Hey, as a result of what weve been pushing for and doing, weve made some progress, they dont want to hear that.

Now, Mr. Yourdon, youre not in that category, but there are some folks who have books to sell, that wont sell very well if we say were making progress, and so they dont want to make progress. O.K., . . .

Liza Christian:

May I make a comment, Senator Bennett?

Senator Bennett: Yeah.

Christian: I dont think theres anyone on this panel today that wants the world to end. Were not propagating that type of press ourselves.

What I think Ive been able to discern is that the media by and large do the contrasts, Is it going to be a drip, or a drizzle? A catastrophe, or a bump in the road?, when really what wed like to see them doing is examining the issue and reporting on it in a factual way, and regardless of the remediation efforts being undertaken, there is that issue that you raised about the testing, and software programming projects typically come in late, and the testing often releases new data thats corrupted, and because of the great deal of interconnectivity, we cant be assured.

So I think what all of us in the community preparedness movement would like to do, is to see people making rational decisions, not bizarre kinds of plans, but certainly beyond--although we respect and appreciate the Red Cross position-- we think that Y2k may require something beyond that.

You also mentioned Kosovo, and we saw how the disaster relief agencies were not equipped to handle the massive migration. They simply could not keep up. And so if we have a nationwide or a global breakdown in the infrastructure, there are not going to be enough resources available.

The Red Cross, FEMA (The National Emergency Management Agency), the National Guard rely on those pockets of the community; sometimes in our particular area, they go to the grocery stores to buy things. Well if those things are not continually being replenished, then there will NOT be supplies, so its simple, prudent preparation for people to have some kind of reserve.

Were not advocating--you know--anything extreme and obviously you want to do it within the realm of whats comfortable for you and wise and affordable, and thats--the other aspect of community preparation is that it takes the focus off of an individual. Its not an every man for himself philosophy but Hey, lets all get together. Lets work as a team, as a community. Lets build resources together. And I think that if we could somehow get the ear and the attention of the media to help us in that realm, it would serve well not just for Y2k but any type of emergency whether it was a personal hardship that affected a town, if maybe--if there were some industries that were no longer available, or a natural disaster.

And the other thing that Id like to point out--and I do commend the strong leadership from the Senate, but I think until we hear a consistent message coming from all the quadrants that are talking about this--business, Senate, the Administration--that were not going to see the shift in the American people to really grab hold of this as a serious implication to the nation.

And so, I think really we need to call a press conference, that would say Really, lets get prepared. Lets do something significant. And have some kind of consistent message.

The other aspect of that is that historically, people have looked to the government to rescue them in a time of natural disaster. I dont believe were going to be in that kind of an enviable position which is another reason to support calling a press conference and having one voice that says, Yes, we do have a problem on the horizon, lets look at this and prepare prudently.

More to come. I really need to take a break! Anyone out there reading along? How am I doing? (When I asked you not to post to this thread, I didn't realize I was going to wind up feeling as lonely as the "Maytag Repairman!" Maybe you can give me some feedback on another thread. . .)

:)

-- FM (vidprof@aol.com), May 26, 1999.

I've read everything up through the point where Senator Bennett ask if the panel members had any questions for the othe panel members. Getting ready to start with what follows. You're doing great! I Thank you for your efforts.

-- (southeastern@deja.com), May 26, 1999.

Thanks FM ! I'm reading every word. Ed's speech differed quite a bit from the transcript that he posted. Thanks so much for your efforts!

-- jeanne (jeanne@hurry.now), May 26, 1999.

Senator Bennett: Any other comments before I. . .

Ed Yourdon, Software engineer and Author: Id like to add one more aspect to the media situation. In many cases themselves the articles are well-written and thoughtful. Several of us here were interviewed for that Time Magazine article, and had no idea that we would be seeing that cover, or the various headlines. Ive learned that the people who make up the headlines are not necessarily the ones who write the reports, and that the articles are often published three years later. . .

Senator Bennett: We politicians have never had that experience. (Audience Laughter. Speakers talking over each other. Laughter.)

Yourdon: Weve become much more sympathetic I think to what politicians are going through, having run through this, but seriously, the thing Im most concerned about with a lot of this coverage, is this the emotional rhetoric. When I hear words like frivolous stockpiling, it makes it difficult for all of us to arrive at a prudent decision. Were all groping and trying to find out whats appropriate. What does our community need? Whats right for this community versus that community? And when we hear adjectives that put a pejorative term on all of this, it makes it that much more difficult to have thoughtful discourse, which is what I think we all want.

Paloma O'Riley Co-founder and Director of Research Cassandra Project:

Yeah, its interesting that whenever you hear about people discussing preparedness, you hear the phrase hoarding. And--what is hoarding? And for what time period? We had a discussion with Red Cross about that--that they said that people should stock up for a week but they didnt agree with hoarding. Well, my grandmother used to stock up for a month, and as you know, there are people who stock up for a year. At what point is it hoarding?

And what this does, is it places a whole negative connotation to the aspect of preparedness, and preparedness is something we should do anyway. Y2k is just giving us the motivation and reason to do it NOW.

As you know, our society has become just in time, in the way that business has. There was a fire chief in Prescott, Arizona who shared a story with me, that unfortunately is not uncommon any longer. They had an unexpected snowstorm, and a frantic call from a woman who said she had no food in the house, and could someone bring her food, because she couldnt get out? They had to send a fire crew out to go to McDonalds or Burger King or something, get her food and bring it to her house.

Many of us, when weve done an informal survey have found that most people usually have only two or three days worth of food on their shelves. Given the fact that we have ice storms that have affected people for a week--up to five weeks, emergency preparedness is something we should be promoting anyway, to make our communities more resilient, and better able to handle any kind of a disaster. As I said, Y2k just gives us a reason to do it sooner.

But all this negative publicity--you dont see this when it comes to preparing for floods, preparing for hurricanes. You only see this with regards to Y2k, and the public is getting the message that if we do anything about Y2k, were gonna end up in that magazine.

And there are a lot of community organizers who literally are not listing themselves on the Internet, and theyre not doing interviews anymore, because they have been maimed by the media whos only interested in sensationalizing the issue, and not interested in actually reporting it as it is. As Liza, myself and several others have noticed, the truth about Y2k organizing is rather boring, and thats probably why theyre sensationalizing it. I mean its just a bunch of people--soccer moms--who get together and discuss O.K., what do we do if the lights go out? You know, Whose house do we go to?

So what we need from you, and yes I agree--and you know that I feel this way--that this Committee has done a great job, but the Committee as a whole is fairly invisible to the general population.

I mean there are some articles and things, but what we really need is, as Liza said, a consensus among the Administration--Koskinen, the Committee, the Congress, everyone saying that, Y2k is an unknown, but emergency preparedness is prudent anyway. So just in case we experience problems lets practice preparedness, and this will give the entire country a push in the right direction, legitimizing it, and making it socially acceptable for people to do preparedness, which today it is NOT, thanks to Time and some of the other media coverage weve seen."

(More to come. The 'scarves and a gun' lady is next!)

(Thanks guys for the encouragement! )

:)

-- FM (vidprof@aol.com), May 26, 1999.

Cathy Hotka, Vice-President Information Technology, National Retail Federation:

I would like to see private industry work with government. As you senators know, the folks who call the governments Y2k hotline are suspicious of what they hear. There are a number of people apparently who are calling. Theyre hearing a reassuring message, and then they hang up and say, Well what do you expect from the government? Of course theyre going to tell me things are fine.

I think it would be useful if private industry could stand together and give the message that Liza mentioned, which is to inform the public, not to give happy talk. Talk about process. Talk about why we think things are largely O.K., but yes--some people ARE going to have problems and they need to prepare, and they need not to wait until December 28th.

Senator Dodd: Well thank you all, very very much, and again--to make a point I was trying to make earlier, I think having this forum here--and I presume there will be some coverage out of it here today--I think helps. Ive always felt that about 90 percent of the effective work of a legislative body is to educate, and about 10 or 15 percent to legislate.

And so by even having forums like this wherein your words are heard, or read, the message received has its own value, in terms of trying to get people to do things that they oughta be doing.

In a sense, I suppose--gotta be careful again, about analogies you draw--but I remember my mother talking about what she did during World War II. They were block captains in the country that mostly were women because men were fighting in the European and Pacific theaters, but they really organized on a neighborhood basis. Now, it never came to anything. We were blessed as a nation and never faced what Europe and other parts of the world did, with invading armies and the tremendous disruption of their lives. But it was good preparedness. O.K., Im sure Ill someone (presuming a headline that reads): ..Dodd calls Y2k World War II, and thats not the point here obviously, Im just talking about the sense of preparedness and I think thats what youre seeing all across the country, communities are--thankfully in the last six months or so--getting activated. I know Ive visited several communities in my state Bob, that wanted me to come in, and have me review what they were doing in their towns. I was struck by that it seems to be the towns that are a bit more affluent that are doing it. Im concerned about my less affluent communities and one of the problems associated with costs, and computer programs and so forth. Hiring people to come in and do the kind of remediation and testing that needs to get done can be very expensive for a community and I dont know if Paloma and others have had legislation in to try to be of assistance with low interest loans to municipalities, a matching program whereby we would encourage communities to do what needs to be done. Now its getting very late obviously at this point here. If you havent already done a lot of this work, the money would be best used for contingency planning I think at this juncture, unless youre just a very small community thats never relied too much on modern technology, but I think promoting that idea of these community based organizations. . . .on June 7th,--I mentioned this in passing, but--on June 7th, John Koskinen is going to hold the first in a series of community briefings at Trinity College in Connecticut. Its a nationwide campaign to start what he calls Y2k Community Conversations, and thats what these Community Conversations packages are, that will be going out around the country, in community after community, to begin to educate people about what can be done, providing materials and so forth, a lot of what youve been talking about here, the Y2k problem, Frequently Asked Questions that people are getting, this video here, the President Clinton remarks on Y2k Conversations, theres uh, these packages here, and posters and so forth, kind of leading the way--just a lot of different good information for community leaders to use to educate people as to the seriousness of this issue.

So I think we are heading--again you could argue this should have been done six months ago, but the fact is, its May, it starts on June 7th, I think it will be of a great deal of assistance and I commend John for doing it.

I think Bob answered the question very well on the convergence, and I appreciate Mr. Nolan, what youre saying here, it is--as things move along--for instance we had a report recently that said that the federal government is overall, and I think its in excess of 90 percent--93 percent. Thats a pretty good number. What that reflects, of course is, based on our assessments of today, that Social Security for instance, is 100 percent ready. Several other federal agencies are 100 percent ready. It also reflects that we have several agencies that are hovering around that late high 70s, low 80s percent ready with 220 days to go.

(More to come)

:)

-- FM (vidprof@aol.com), May 26, 1999.

Update: Complete Oral testimony from first hour now posted at this thread:

http://www.greenspun.com/bboard/q-and-a-fetch-msg.tcl?msg_id=000sR7

:)

-- FM (vidprof@aol.com), May 26, 1999.