Clinton Establishes Council To Fix 'Year 2000' Glitch
By Juliana Gruenwald, CQ Staff Writer
Amid growing concerns that the federal government and parts of the
private sector may not fix the problem in time, federal officials are
taking steps to ensure that critical computer systems will not malfunction
as a result of a computer glitch that may kick in at 12:01 a.m. on Jan. 1,
The latest move came Feb. 4 when President Clinton issued an executive
order creating a White House council to coordinate the federal government's
efforts to fix the "Year 2000 problem." The next day, a House panel
approved legislation (HR3116) to ensure that financial institutions, such
as banks and credit unions, are taking the necessary steps to prevent
The problem stems from a practice begun in the late 1960s to conserve
computer memory and save money by using two digits in the date field to
represent the year, using " '98," for example, for the year 1998.
When the date changes to 2000, many computer systems that perform time-
or date-sensitive tasks may malfunction or shut down unless they are
reprogrammed or replaced because they will not be able to distinguish
between "00" in "2000" and "1900." For the federal government, the problem
could affect everything from the computers running the nation's air-traffic
control system to those operating sophisticated weapons systems.
Even if a new computer system is Year 2000 compliant, it may be
contaminated if it runs old software or interacts with other computers that
have not been fixed.
"Minimizing the [Year 2000 problem] will require a major technological
and managerial effort, and it is critical that the United State government
do its part in addressing this challenge," Clinton said in his executive
order creating the new Council on the Year 2000 Conversion. It will be
headed by John Koskinen, a former Office of Management and Budget (OMB)
The OMB had been in charge of overseeing the progress of federal
agencies in fixing the problem. But some lawmakers had urged Clinton to
establish a White House office to coordinate the government's Year 2000
efforts, saying the problem needed to be handled by a high-profile office
that could devote full-time attention to the issue.
"We are glad the White House finally recognized the importance of the
Year 2000 issue," said Rep. Steve Horn, R-Calif., chairman of a House
Government Reform and Oversight subcommittee with jurisdiction over the
The problem could have a debilitating impact, not only on the federal
government, but on almost every aspect of the private sector that relies on
computers or computerized devices. "We are looking down the barrel of a
potential disaster," said Rep. Gil Gutknecht, R-Minn., during a Feb. 4
hearing on the Federal Aviation Administration's Year 2000 efforts.
During that hearing, officials from the Department of Transportation
and the General Accounting Office (GAO) expressed concern about the FAA's
slow progress in ensuring its computer systems, which include those that
run the air-traffic control system, are Year 2000 compliant. If the agency
continues at its current pace, it will not fix its systems in time,
according to a GAO report.
While acknowledging the agency has not tackled the problem as
aggressively as necessary, FAA administrator Jane F. Garvey insisted,
"Aviation safety will not be compromised. Ensuring that we meet this
challenge is one of my top priorities."
Banking Panel Acts
Meanwhile, the House Banking and
Financial Services Committee approved legislation by voice vote Feb. 5
aimed at shoring up the financial community's efforts to fix the Year 2000
Among the numerous problems banks could encounter if they fail to fix
their Year 2000 problems are errors in checking account transactions and
interest calculations. Among the problems consumers could encounter are
malfunctions with automated teller machines, which may assume all bank cash
cards have expired.
The legislation (HR3116) requires federal banking agencies and the
National Credit Union Administration, which regulates all federally
chartered credit unions, to conduct seminars for financial institutions on
the implications of the Year 2000 problem and provide suggestions for
solving problems associated with it.
HR3116 also gives the Office of Thrift Supervision and the credit union
administration the authority to examine the operations of service providers
who contract with financial institutions to perform such tasks as data
processing and information system management. This extension of authority
would give the two agencies the same statutory authority enjoyed by the
Federal Reserve, the Comptroller of the Currency and the Federal Deposit
The bill's supporters say this extension of authority is necessary to
ensure that service providers that contract with thrifts and credit unions
are taking the steps to be Year 2000 compliant.
Under current law, the two agencies have to gain the permission of the
service providers to examine their operations but not all have been willing
to cooperate, officials said.
Some committee members and industry officials expressed concern about
broadening the credit union administration's regulatory authority. They
said unlike the thrift office, the credit union administration has not made
a case for permanently extending its authority.
The committee adopted by voice vote an amendment offered by Reps.
Richard H. Baker, R-La., and Spencer Bachus, R-Ala., to sunset the credit
union administration's authority over service providers on Dec. 31,
© 1998 Congressional Quarterly Inc. All rights reserved.