Steven Levitt (of Freakonomics fame) has started a small controversy by casually mentioning that the Y2K crisis was a false prophesy (his more detailed followup posting is here; he also points to a paper that I didn’t bother reading, but probably does a better job than my posting of going over the issue).
While I never advertised myself as a Y2K consultant, I made money from the Y2K panic like everyone else in IT — even if I didn’t do Y2K projects directly, systems were being replaced early because of Y2K, IT departments were getting bigger budgets and spending on whatever they wanted, etc. And like many (most?) people reading this weblog, I went out of my way to try to explain my customers at every opportunity why the Y2K threat was exaggerated.
The logic was simple: the scare stories in the press talked about everything shutting down at midnight on December 31 2000, but in fact, times and dates in IT systems are much more complicated than that: information and events go through lifecycles that have starts, ends, and often many stages in-between. Here are some examples:
- If you took out a 20-year mortgage in 1980, the expirty date would have been 2000.
- If you were 55 in 1990, you would have been 65 in 2000.
- If you received a new credit card with a five-year term in 1995, the expiry date would have been 2000.
- When your credit card bill arrived on 15 December 1999, payment was probably due in 2000.
So how many of you received notices in 1981 that your mortages were 81 years overdue? Or how many of you received pension benefits for 156-year-olds in 1991? How many of you found that your credit cards were declined in 1996 because they were 96 years past expiry? Or how many of you were charged 99 years’ interest for an unpaid credit-card bill in 2000?
Of course, some of these things did happen to some people in the decades leading up to Y2K, but only very rarely — rarely enough, in fact, that every case was considered newsworthy. 2000 was going to be the peak of a curve that started decades before and ended decades after, but since the curve was still so close to zero by the 1990s, it was obvious to anyone who cared to spend time thinking (even a statistical numbskull like me) that the Y2K consultants screaming doom and gloom were either not fully competent or not fully honest. It was important, of course, to check the most critical systems, like hospital equipment or nuclear power plants, but Y2K was hardly going to be a real operational problem for most organizations.
Those same consultants defend themselves now, of course, by claiming that they averted a catastrophe, but that is trivially easy to disprove — countries that spent very little on Y2K preparedness, like France, had no more problems that countries that spent a lot, like the U.S. and Canada. Of course, France benefitted from some spill-over from the North American IT work, but there still should have been a significant, measurable difference between the two. There wasn’t. QED.