[Congressional Record (Bound Edition), Volume 145 (1999), Part 3]
[Senate]
[Pages 3320-3333]
[From the U.S. Government Publishing Office, www.gpo.gov]




     INCREASING FUNDING OF THE SPECIAL COMMITTEE ON THE YEAR 2000 
                      TECHNOLOGY-RELATED PROBLEMS

  The PRESIDING OFFICER. Under the previous order, the hour of 2:15 
having arrived, the Committee on Rules and Administration is discharged 
from further consideration of S. Res. 7, and the Senate will proceed 
immediately to its consideration.
  The clerk will report.
  The bill clerk read as follows:

       A resolution (S. Res. 7) to amend Senate Resolution 208 of 
     the 105th Congress to increase funding of the Special 
     Committee on the Year 2000 Technology-Related Problems.

  The Senate proceeded to consider the resolution.
  The PRESIDING OFFICER. Under the previous order, the time for debate 
on the resolution shall be limited to 3 hours, equally divided between 
the Senator from Utah, Mr. Bennett, and the Senator from Connecticut, 
Mr. Dodd.


                         Privilege of the Floor

  Mr. BENNETT. Mr. President, I ask unanimous consent that for the 
duration of this debate, the following members of the staff detailed to 
the Special Committee on the Year 2000 Technology Problems be granted 
the privilege of the floor: Frank Reilly, John Stephenson, Paul Hunter, 
J. Paul Nicholas, Ron Spear and Tom Bello.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Unanimous Consent Agreement

  Mr. BENNETT. Mr. President, I ask unanimous consent that the consent 
agreement with respect to the consideration of S. Res. 7 be modified to 
allow one technical amendment to the resolution, to be offered by 
myself and Senator Dodd.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                            Amendment No. 30

                 (Purpose: To make a conforming change)

  Mr. BENNETT. The technical amendment is now at the desk, and I ask 
for its consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Utah [Mr. Bennett], for himself and Mr. 
     Dodd, proposes an amendment numbered 30.

  The text of the amendment follows:

       On page 1, line 5, strike ``both places'' and insert ``the 
     second place''.

  Mr. BENNETT. Mr. President, I ask unanimous consent that the 
amendment be agreed to and that the motion to reconsider be laid upon 
the table.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 30) was agreed to.
  Mr. BENNETT. Thank you, Mr. President.
  As I have said somewhat facetiously, today is ``Y2K Day in the 
neighborhood.'' We have had a series of events with respect to Y2K 
legislation, starting with the debate this morning on the Small 
Business Administration bill offered by Senator Bond of Missouri. We 
then went into a closed session where it was my privilege, along with 
Senator Dodd, to make a presentation to Members of the Senate with 
respect

[[Page 3321]]

to the impact of Y2K on our national defense and our intelligence 
capabilities. And now this afternoon, we have 3 hours to discuss the 
funding request for the Special Committee on the Year 2000 Technology 
Problems and, in that process, take the opportunity of the debate to 
lay out for the Senate and for the television public exactly what we 
are dealing with.
  To summarize ``Y2K in the neighborhood,'' I have a single chart that 
we used in the press conference earlier that outlines what it is we are 
talking about.
  Specifically, as you see, Mr. President, it says, ``Y2K--What is 
it?'' There are some who think it is a rock band and we will make that 
clear. And then, Why are we vulnerable? Where are the greatest risks? 
What is being done? What should we be doing next? And what can we 
expect? It is in the framework of those questions that I will be making 
my presentation today.
  In the closed session, we talked about national defense issues, 
international assessments country by country and the preparedness of 
the U.S. intelligence community. I report to the Senate as a whole, for 
those Senators who were not able to be there, that we announced these 
conclusions to the Senators who were there and, I might say, Mr. 
President, we were very gratified by the number of Senators who did 
appear. The room was full, and the Senators were very attentive, which 
I think is appropriate given the significance of this issue.
  We believe that there is a low-to-medium probability of exploitation 
of Y2K by any terrorist groups. People in the press conference asked 
me, ``Well, can you be specific?'' And the answer is no. We know of no 
intention on the part of terrorist groups to exploit Y2K uncertainty, 
but these groups are there, they are up to mischief, and so we say 
there is a probability, but it is at the low end of things.
  There is a low probability of a nuclear launch coming by accident as 
a result of Y2K. Again, we cannot rule it out absolutely, but we think 
the probability of it is very low.
  There is a medium probability of economic disruptions that could lead 
to civil unrest in various parts of the world, and we will discuss that 
here in the open session as we outline for you how vulnerable some 
parts of the world may be to Y2K interruptions.
  There is a high probability of an economic impact with consequences 
unknown. Here we can only guess, but I think there is a high 
probability that Y2K will, in fact, produce some kind of economic 
dislocation that we will feel.
  As far as U.S. preparedness is concerned, the U.S. Armed Forces will 
not lose their mission-critical capability, their war-fighting 
capacity. The United States will remain the world's superpower, and the 
U.S. intelligence community will not lose its capability to carry out 
its duties.
  To go to, first, the question--What is Y2K?--in case there is anyone 
who really doesn't understand what we are talking about here, it goes 
to the inability of a computer to recognize the difference between 1900 
and 2000 as a date if that computer is programmed for only two digits 
for the date field for years. This goes back to the 1960s, maybe even 
the 1950s when memory space was very, very expensive, very, very 
crucial and, in order to save space, programmers said, ``Well, we can 
just drop the ``19'' off the year and go to ``69'' for 1969, ``70'' for 
1970, and so on. And when someone said, ``Well, what happens when you 
get to the year 2000 and you get two zeros and the computer will think 
it is 1900?'' The answer on the part of those programmers was, ``This 
program will be obsolete and abandoned long before we get to the year 
2000.''
  They didn't realize the ingenuity of programmers. They figured out a 
way to preserve those ancient programs and to lay other layers of 
programming on top of them in such a fashion that the old programs look 
like the new ones, but deep down in the bowels of all of that 
programming, you have programs that are scheduled to fail when they get 
to the crucial time when they go over from 99 to 00.
  There are many other manifestations of it, going down to embedded 
chips, computers no bigger than my little fingernail that nonetheless 
have in them the capacity to fail over this issue. But basically that 
is the issue. That is what Y2K is. The failure of computers, when they 
have to transition from 1999 to 2000, those computers that are 
programmed with two digits for the annual date may fail--some of them 
certainly will fail--and that is what Y2K is all about.
  By the way, people ask, What does ``Y2K'' stand for? ``Y'' stands for 
year, ``2'' stands for 2--that is fairly easy to follow--and ``K,'' 
from the Greek, standing for kilo, meaning 1,000. It is computer speech 
for the year 2000. My wife says to me, ``Why do you use that acronym? 
You just confuse people. Why don't you say `year 2000' instead of 
`Y2K.' '' And I say, ``Well, it's quicker.'' She says, `` `Y2K,' `year 
2000,' you only save one syllable. What is the point? You just do it to 
confuse people.'' But I guess I have been in Government long enough now 
that confusing people is part of the program.
  So what is Y2K? I think that is the answer to the question.
  Why are we vulnerable? We are vulnerable because at virtually every 
point of importance in the modern economy and modern activity there 
stands the computer--whether it is on a chip or in a huge mainframe--
with the capacity to fail.
  Let's take an event that we hope never happens to any of us, but that 
is a demonstration of a true emergency--a fire in a building--and see 
what happens. Here is a picture of a burning building.
  In order to muster the firefighting capability to deal with this 
emergency, you have a number of people and a number of systems that are 
involved. There is the computer-aided dispatching system to send the 
firefighter to where the challenge is. There is the telecommunications 
system where the telephone calls go back and forth to send the message 
from the dispatching system; the building security and fire detection 
systems that make the phone call back to the dispatching system.
  The firefighters jump in their cars or their trucks. The trucks have 
to be filled with fuel. And the pumps that control the fuel supply that 
goes into the firetrucks all have computers in them--embedded chips. 
The traffic control system that controls the ability of the fire engine 
to get through town all has computers in it. The water supply, when 
they get to the hydrant, is regulated by computers. And, of course, the 
personnel management systems that get the firefighters into the fire 
station in the first place now are all managed by computers.
  A single event we take for granted, all of the things that are done 
to bring to bear on this event--some firefighting capability, but there 
are computers at virtually every step of the way.
  Now, just another example of how interconnected we are in this world. 
Let's take a single transaction that takes place this time across 
international lines. This will be, perhaps, a little hard to follow 
because the chart is relatively smaller and less dramatic than a 
burning building, but just let me walk you through this as to what 
happens when there is a commercial transaction that goes across 
national lines.
  An import-export kind of transaction. Every red arrow that you see 
there on the chart, Mr. President, is a transmission of information by 
computer. Every single time something takes place with the purchase and 
delivery of an item across national lines --you start the contracts, 
the negotiations by the Internet, a checking of credit, the contract by 
the Internet--all the way through. The white arrows on the chart are 
where something physically moves, when you are moving a piece of 
merchandise out of a factory onto a ship or out of the truck into a 
retail store or whatever.
  Without going through all of the steps, I just point out that there 
are more red arrows than there are white ones. There are more 
opportunities for computer failure to ruin the ability of this 
transaction to go forward than there are physical opportunities for it 
to fail. We are so heavily interconnected in this world now that we

[[Page 3322]]

are completely vulnerable to a computer failure. And at every red arrow 
on that chart right now there is a computer with a potential Y2K 
problem.
  Someone once said to me, This problem is really very simple. You just 
get into the computer and find out where the date is and fix it; change 
it from two digits to four digits. And I say, yes, that is very simple, 
very simple problem, very simply solved. The only problem is, you do 
not know where that date field is, particularly in those old programs 
that I talked about.
  It has been likened to this kind of a challenge: Suppose someone said 
to you, Mr. President, the Golden Gate Bridge has some bad rivets in 
it, and if you do not replace those faulty rivets, the Golden Gate 
Bridge will fall down. All you have to do is very simple: Knock out the 
bad rivet, put in a good rivet, and the bridge is made secure.
  Now, one out of seven of those rivets in the Golden Gate Bridge is 
bad, and we cannot tell you which ones they are. You have to go through 
the Golden Gate Bridge and check every rivet to see which seventh rivet 
has to be fixed. And by the way, if you do not get every single one, 
the bridge will collapse, and you do this remediation work at rush hour 
while the bridge is being used. That is roughly comparable to the 
challenge that we face here. And that is why we are vulnerable. OK.
  The next question is, Where are the greatest risks? Well, we can 
answer that two ways. On our committee, we have decided to rate the 
greatest risks in terms of which sectors of the economy have the 
greatest importance to us. And when you rank risk by importance, No. 1 
immediately leaps to the top of the list; and that is power.
  If the power goes off, it does not matter if your computer works 
otherwise. The only computers that will work in the world, if the power 
goes off, will be those that have batteries, and that is about 2 or 3 
hours, and they are all gone. So we have put our first focus on power.
  Second, telecommunications. If the telephone goes off, the power grid 
fails, because many of the signals that keep the power grid functioning 
go over telephone lines. So once again, everything stops.
  Third, transportation. If transportation fails, you cannot get coal, 
for example, from coal mines into power-generating plants. If the 
switches on all of the railroad lines fail--and they are controlled by 
computers--there is no coal in the powerplants. The power grid fails, 
everything fails.
  You begin to see, again, how interconnected everything is.
  Fourth, finance. If the banks cannot clear checks, if there can be no 
transfer of funds, if the financial system collapses, then business 
collapses. Once again, the chain starts, and you end up ultimately with 
no power, all the rest of it.
  Then, general government. We are so dependent on government services 
to keep the economy running that if the general government services 
were to fail--in the Federal Government, for example, if the Health 
Care Financing Administration were to fail and be unable to make any 
Medicare reimbursements, it would ultimately destroy the health care 
industry, because 40 percent of the health care reimbursements are 
Medicare reimbursements. And you simply could not keep a health care 
facility going if you cut their cash by 40 percent and left it that way 
for a while.
  Finally, general business.
  Those are the ranks of importance that we have looked at in our 
committee.
  Let me take this opportunity to make this statement about what we 
found. The committee has been operating for roughly a year now, and in 
that process people who have looked at the list I have just recited 
have gotten very excited. Indeed, they have begun to create a cottage 
industry of panic.
  You can get on the Internet and you can look up any kind of web site, 
and they will take the possibility of computer failure in any of the 
areas I have just outlined and translate that into what has come to be 
known in the world of Y2K hyperbole as TEOTWAWKI. Now, TEOTWAWKI is the 
acronym that stands for ``The End Of The World As We Know It.'' They 
use that phrase so often, they created an acronym. Now you can get on 
the Internet and they will talk about TEOTWAWKI.
  Mr. President, I am here to announce that TEOTWAWKI is not going to 
come to pass. We are satisfied, as a result of the hearings we held, 
and the interviews we held, and the investigations we have undertaken 
on the Senate Special Committee on the Year 2000 Technology Problem, 
that the world is not, in fact, going to come to an end over this 
problem--certainly not in the United States. We will have problems. 
There is no question, given the ubiquitous nature of the problem, that 
it will cause interruptions and difficulties in the United States, but 
it will not bring everything to a halt. It will not cause the shutdown 
of vital services. In our opinion, it will be a bump in the road for 
the United States.
  Now, people say: What does that mean? How serious a bump and how long 
will it last, Senator Bennett? I don't know, and I don't know anybody 
who does, because this is a moving target, there are so many potentials 
for challenge, that we cannot quantify it with the kind of accuracy 
that the press always searches for when they ask you these questions. 
It will have an impact. It will be felt. But how long it will last and 
how deep it will go I don't know. That is why the committee is going to 
continue, so that we can continue to study it, and as we get closer to 
it, we will be in a better position to make that kind of assessment.
  Now, if we ask the question, Where are the greatest risks? --not in 
the pattern of the impact on the economy that I have talked about, but 
on our current state of readiness--we find that the greatest impact, 
based on what we now know in the committee, is probably going to be in 
the health care field. This is the field that we think is the least 
prepared to deal with the year 2000 problem in the United States.
  One of the reasons for that is it is so fragmented. There are so many 
hospitals. There are so many separate doctors' offices. Some of them 
have done nothing to prepare for the year 2000. Frankly, some of them 
can solve their problem in an afternoon. Some of them that are 
operating off of a single PC can get a patch downloaded from the 
Internet that can solve their problem. Some of them are going to 
require substantially more than that. And some of them, frankly, are 
far enough behind the curve, if they are not on top of it by now, it is 
too late and they ought to start thinking about contingency plans. We 
simply do not know. What we do know causes us to believe that health 
care is vulnerable.
  Senator Dodd, I am sure, will be addressing this in greater detail 
because he is the one who has focused on this to a greater extent than 
any other member of the committee.
  Another area of readiness that we are concerned about is local 
government. I gave this Y2K speech at a Rotary Club meeting in a small 
town in Utah and people asked me, ``What should we do to get ready for 
Y2K?'' I gave them the same answer I always give them, which is, you 
should take charge of your own life; you should check with your own 
bank to make sure they are going to be Y2K compliant; you should check 
with your own employer to be sure he or she is getting things under 
control; and, among other things, I said, call your mayor to make sure 
your water system is going to be all right in your local community.
  I have done that in Salt Lake City. I have had some long discussions 
with the mayor of Salt Lake, and she assures me it will be safe for me 
to be in Salt Lake on New Year's Eve because the water system will 
work.
  After I gave the speech, a man came up, shook my hand, and said, 
``You have caused me some problems.'' I asked why, and he said, ``I am 
the mayor.'' I said, ``Mr. Mayor, is your water system going to be all 
right?'' He said, ``I don't have the slightest idea but I am sure going 
to find out.'' He said, ``It never occurred to me that we had computer 
problems in our water purification plant.''
  We have held hearings on this issue. I have been in a water 
purification plant. While I think most local governments are 
responsible enough and will

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be on top of it, I am concerned that there will be local governments 
where there will be critical emergency response systems that will 
fail--fire departments, ambulances, and so on, water systems, federally 
funded services. Many of the federally funded services are administered 
at the local level. Welfare checks are mailed out by county 
governments, not by the Federal Government, in many instances. And in 
these communities, there can be serious disruption even while the 
Nation as a whole is doing fine.
  In the economy as a whole, the area that is at the greatest risk is 
where we find medium-sized businesses. The big businesses are probably 
just fine. Citigroup announced when we first got into this they were 
going to spend $500 million fixing their year 2000 problem. That went 
up to $650 million by the time we got around to drafting the report. 
Now, the day the report is issued, we are told they are spending closer 
to $800 million to get this solved. But Citigroup will get it solved. 
They have the money and the muscle and the will to get it taken care 
of.
  The very small businesses will probably get it solved because, again, 
for them, they are dealing with a single computer that runs their 
payroll and maybe does their taxes, and they do everything else by 
hand. They can solve that problem in a short-term period of time. The 
middle-sized businesses that don't have the money of a Citigroup and 
that have a much bigger problem than a mom-and-pop store are running 
into difficulty. The surveys we are conducting tell us that these 
companies are where the problems are going to be.
  Now you may say, so what? We should really care if an individual 
business here or an individual business there should fail or should 
have serious problems. In today's economy, we live in a world of 
outsourcing and just-in-time inventory. That means that General Motors 
has literally tens of thousands of suppliers. General Motors does not 
make everything themselves; they outsource. That is a fancy name for 
buying it from somebody else. They are dependent on these medium-sized 
businesses for their parts. One of the scary things is that many of 
these medium-sized businesses on which General Motors and other big 
manufacturers are dependent are overseas.
  I used to run a very small business, so small that it wouldn't really 
attract anybody's attention, but the key component of our business, 
without which we had no product, was manufactured in Taiwan, and if we 
were unable to get that from Taiwan because of Y2K problems in Taiwan, 
we were out of business. We sold our product to a much bigger company. 
They were dependent upon us. They could have all of their computers Y2K 
compliant and be unable to get product from us and therefore have to 
drop a major product line for them. We couldn't supply it because we 
couldn't get this product from Taiwan. You see the chain of suppliers 
that runs throughout the economy in this just-in-time inventory world.
  When I say I am concerned about medium-sized firms as an area of high 
risk, it could affect big firms and could affect the economy as a 
whole.
  Now, the next question after where is the greatest risk: What are we 
doing about it? What is being done? Here, I think, it is time for the 
Senate and the Congress, if I might, to be a little bit self-
congratulatory. When this problem first came to the attention of the 
Congress, Senator Burns of Montana has said he held hearings on this 
issue, or had been involved in hearings on this issue back in the early 
1990s. He said we couldn't get anybody interested; nobody paid any 
attention. He was on the Commerce Committee. He said the thing just 
kind of dropped without a trace.
  We first became aware of this on the Senate Banking Committee in 
1996. That is where Senator Dodd and I became zealots on this issue, 
and we began to work on this with respect to the financial services 
area. The more we got into that, the more we realized that it 
encompassed all of the things that I have described here this 
afternoon.
  One example demonstrates what I am talking about when I say that 
Congress can be a little bit self-congratulatory about the question of 
what is being done. My son-in-law works for one of the major banks in 
this country. He said at a family gathering, ``You know, I don't know 
what's happened, but the bank examiners from the Federal Reserve who 
come into our bank now have only one thing on their minds, and that is 
Y2K, and they have made it the top priority in the bank.'' I thought, 
you know, we have finally done something in Congress that has produced 
a result because, at Senator Dodd's suggestion, we got the bank 
regulators before our subcommittee of the Banking Committee and we 
raised this issue with them; we discovered several things. No. 1, they 
were not raising it as part of the safety and soundness examination 
they were doing in banks. No. 2, their own computers weren't going to 
work in the year 2000. They would not be able to conduct their 
regulatory activities if we didn't get it fixed. The mere act of 
holding a hearing and bringing these people forward produced a salutary 
result that actually got out into the economy and changed the way 
things are being done.
  Well, now, I think we can take some credit for having raised that 
alarm. Senator Moynihan wrote to the President and urged him to appoint 
a Y2K czar or coordinator. The President did not respond. I wrote to 
the President after we had our hearings in the Banking Committee and 
recommended it. He did not respond to me, either. But in February of 
1998, he did, in fact, appoint a Y2K coordinator. I think the track 
record says it is the Congress that possibly spurred that. And we now 
have a President's Council on the Year 2000 Conversion, headed by John 
Koskinen, working very diligently to make sure the Federal Government 
and the economy as a whole is ready for this. We are doing everything 
we can to create awareness of the challenge. At the same time, we want 
to be sure, in words that we have used before, that while we are ``Paul 
Revere,'' we are not ``Chicken Little.'' We have to get everybody 
aroused to the fact that the British really are coming. They have to 
get out of their warm beds and pick up their muskets and get ready for 
this; but the sky is not falling and it will not be TEOTWAWKI; it will 
not be the end of the world as we know it.
  Well, I see that the vice chairman of our committee, Senator Dodd, 
has come on to the floor. Soon I will reserve the remainder of my time 
and give him an opportunity for a statement about this.
  Other members of the committee have expressed an interest to come to 
the floor and talk about this issue. I want to acknowledge the 
tremendous support we have had on this committee. This is a unique kind 
of committee in that we have had tremendous bipartisan support. My 
staff and Senator Dodd's staff function almost as one on this 
committee. We have made every effort to keep any kind of partisanship 
out of it. We go out on field visits together. Senator Dodd has been 
indefatigable in his effort to keep this thing going, and he prods me 
in areas where I need it and keeps the committee focused in areas where 
sometimes I stray in other places. It has been one of the most 
satisfying legislative experiences that I have ever had.
  Other members of the committee, the same way. Senator Moynihan was 
into this issue before we even discovered it and came onto the 
committee with great enthusiasm. Senator Smith of Oregon, who came to 
the Senate as a businessman, took charge of dealing with business and 
Y2K's impact on business and has been tremendously helpful. We have had 
Senator Bingaman, who we have asked to focus on the national defense 
issues. Senator Collins, as a representative of the Governmental 
Affairs Committee, has held hearings in that committee based on what 
she has come up with out of our committee. Senator Kyl did all of the 
heavy lifting on the committee for last year's bill on disclosure and 
has been enormously valuable.
  And then we have, unlike any other committee in the Senate, two ex 
officio members, Ted Stevens of Alaska and Robert C. Byrd of West 
Virginia; and the fact that the Federal Government

[[Page 3324]]

received literally billions of dollars in emergency funds in the last 
supplemental, which, I think, have dealt with the true emergency. I 
think we are responsible for our being where we are in many of the 
government agencies. I don't think that would have happened if the 
chairman and ranking member of the Senate Appropriations Committee were 
not involved directly and particularly in the work of this particular 
special committee.
  So, with that tribute to my fellow Senators on this committee and the 
work that has been done, I will reserve the remainder of my time, Mr. 
President, to allow the vice chairman of the committee and the ranking 
Democrat, Senator Dodd, to make his statement.
  Mr. MURKOWSKI addressed the Chair.
  The PRESIDING OFFICER. The Senator from Alaska is recognized.
  Mr. MURKOWSKI. Without breaking into the colloquy, I wonder if I can 
have 5 seconds to introduce a bill.
  Mr. BENNETT. Mr. President, I ask unanimous consent that the Senator 
from Alaska be recognized for the purpose of introducing a bill.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. Murkowski pertaining to the introduction of S. 
501 are located in today's Record under ``Statements on introduced 
Bills and Joint Resolutions.'')
  Mr. DODD addressed the Chair.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. DODD. Thank you, Mr. President.
  Mr. President, let me begin these remarks by seconding everything 
that my colleague from Utah has said about the other members of this 
committee. I will add, as I know he has expressed on numerous 
occasions, the tremendous work done by our respective staffs. They have 
done a tremendous amount of work in providing us with the kind of 
detailed information that we have been able to produce at this juncture 
in our interim report, which we released today.
  Let me also, on behalf of other members of the committee, say to you 
and to our colleagues here that we have been truly fortunate to have 
Bob Bennett lead this effort. I have said this on numerous occasions. 
He has literally been the leader on this in the Senate. He began early 
on and insisted that the Banking Committee have a subcommittee that 
would look at the implications of this year 2000 ``bug,'' as it is 
affectionately referred to, on financial institutions. It was as a 
result of his efforts that my curiosity was piqued.
  As a member of that committee--not as the ranking Democrat, but as a 
member of that committee--I attended a number of hearings we had on 
financial services, and I quickly learned through that process that 
this issue went far beyond the individual institutions that had to do 
their own assessments. What Senator Bennett discovered very early on 
and what others of us who sat in on those committee hearings soon 
learned, was that it wasn't enough to be a financial service and have 
your own house in shape when it came to the Y2K issue, and that the 
bank, or the savings and loan, or the stock brokerage, or any other 
financial service, insurance agent, or company--if they were in good 
shape internally, that wasn't enough. They had to also determine 
whether or not suppliers and customers, all sorts of contractors with 
whom they do business, would also have to be in good shape.
  That obviously drew us to the conclusion that this was an issue that 
deserved broader attention than just looking at the financial services 
sector. As a result, Senator Bennett and I went to our respective 
leaders and asked and urged them to support this special committee that 
has no legislative authority. We have no authority to pass any laws or 
do anything, but merely try to make an assessment as we now approach 
the millennium date 304 days from today.
  As a result of those efforts, beginning last year, Trent Lott, our 
majority leader, and Tom Daschle, the Democratic leader in the Senate, 
supported our efforts to form this committee. We owe them a great debt 
of gratitude, as well, as leaders for giving us the kind of support 
that has been necessary to do our jobs.
  Today, at the conclusion of this discussion, there will be a vote on 
a matter that would provide an additional $300,000 over the next year 
for us to complete our work as we now enter this second phase of this 
assessment of how the Nation and the world is responding to this issue. 
So we hope that our colleagues will be supportive of that effort to 
allow us to complete our work.
  Again, at the outset, I want to thank my friend and colleague from 
Utah whose own background in business--and a successful business, I 
might add--has brought some wonderful awareness and knowledge to all of 
this. It has been truly enjoyable to work with him and his staff over 
these past number of months which has brought us to the place we are 
today.
  The Senate special committee, which formed in April, as I have said, 
has been working hard to assess a variety of industry sectors. Some 
sectors have been very cooperative. We should tell you that in this 
kind of effort so much information and so much news is focused on what 
is wrong. We need to take some time to tell you about what is right, 
too.
  There is a lot that is going on that is right when it comes to this 
issue. It doesn't get the same attention. The old axiom that the media 
doesn't report about planes that fly is certainly true in the Y2K 
issue. The headlines are going to tell you about where the problems 
are. That is the nature of the news media and what gets covered. But 
there are a lot of planes that are flying, if you will, both literally 
and figuratively when it comes to the year 2000 issue. Those that have 
been doing the work getting the job done deserve to be recognized as 
well. Others have needed more persuasion, unfortunately. We will get to 
that.
  After 10 months of research, we have now completed our report, which 
I have referred to already, which gives you the status on seven major 
sectors. It is not an all-conclusive list. But we came up with this 
list. Senator Bennett did. He came up with a list of seven critical 
areas that we thought most people would have questions about and 
legitimate concerns. I will get to that in a second. I know Senator 
Bennett has already discussed that to some degree.
  The report was intended to provide as comprehensive as we could an 
analysis, and described as thoroughly as we could in a single document 
how ready we are to face this millennium issue that is going to be upon 
us in 304 days; in some cases before.
  Reflecting on what we have learned from our research and hearings, I 
think it would be an understatement to say that Y2K is an important 
issue. Expert opinions on the subject have ranged from denial to the 
coming of Armageddon.
  While we don't foresee any major disruptions, anyone who hasn't begun 
to consider the ramifications of this problem should do so immediately, 
in our opinion. Some businesses within different industries have been 
extremely forward thinking in their year 2000 preparation efforts. 
George Washington Memorial Hospital, right in our own Nation's Capital 
in the city of Washington, began its remediation efforts a half a 
decade ago in order to be ready for the year 2000 issue. State Street, 
an international financial service in Boston, MA, began fixing its year 
2000 problem 6 years ago and is projected to spend some $200 million on 
remediation efforts. The cost has been significant. For some it will 
continue to rise as companies continue to discover problems and work 
through them.
  Consider for a moment, if you would, Mr. President, the cost of not 
being ready, especially with regard to exposure to litigation. 
Projected litigation costs have ranged from $500 billion to $1 
trillion. You can be sure that these costs in one way or another will 
be passed on to consumers in other groups.
  Let me just mention the litigation issue. As my colleague from Utah 
knows, and others know, I have been a strong advocate of litigation 
reform. Senator Gramm of Texas, Senator

[[Page 3325]]

Domenici, myself, and others authored the securities litigation reform 
bill, and then last year we passed the uniform standards legislation to 
reduce the proliferation of computer-driven complaints where mere stock 
fluctuations would generate lawsuits. I think it was a good effort and 
was endorsed by the Securities and Exchange Commission, and 
overwhelmingly supported by our colleagues on both sides of the aisle. 
I am a supporter of litigation reform in this area, too. I think it is 
going to be very important that we do something in this area to reduce 
the potential costs of unwarranted litigation.
  Having said that, however, Mr. President, I also want to say that 
there should be no mistake out there that this committee and this 
Congress are not about to create some firewall that protects businesses 
or industries when they should have known better and done better and 
didn't do so. If you are sitting back and saying, I hear Congress is 
about to pass some legislation that is going to insulate me and protect 
me from consumers and businesses and others that would have a 
legitimate complaint against a company that did not do its Y2K work, 
you would be mistaken. I think I am speaking for most of us here who 
feel that way. That is not to say we will not be able to pass a bill. I 
hope we can. But we shouldn't leave the impression that this is going 
to be somehow an abolition of tort law in this country.
  There is a reason why we call these problems bugs or viruses. Like a 
disease, this issue can corrupt the functioning of vital systems, can 
cause damage, shutdown, and can bring the flow of work to a halt. They 
can take a business out of business very quickly. They can stop the 
flow of information and communication.
  As concerned as I am, let me make the point that we believe the 
United States is one of the most prepared nations in the world. We have 
the resources we need both in terms of economics and expertise. 
However, most countries lag behind the United States in the year 2000 
preparation.
  I cannot stress to you enough, Mr. President, the serious nature of 
this topic. This is not an imaginary problem just because we can't at 
this time quantify as exactly as we would like, or forecast as exactly 
as we would like, the extent of this problem. We don't know for sure 
what is going to happen, and where it is going to happen. So we must 
prepare, in our view, for a bad situation. We hope it doesn't occur. 
There is no information we have that it is likely to occur. But we 
don't know. We just don't know with the kind of certainty we would like 
to share with our colleagues and share with the Nation.
  Some chief executive officers and government leaders assume because 
this is a technical problem and they lack technical expertise that 
their hands are somehow tied. This is not the case. There is no 
singlehanded resolution to this crisis. A successful resolution will 
call for cooperation across the board. This is not just a technology 
problem. It will require managers who are willing to get involved at 
all levels. It will take leaders in business, in the U.S. Congress, and 
at the executive branch level to take the initiative and find out where 
companies and organizations, nonprofits and for-profits, are in their 
Y2K remediation and contingency planning.
  Large, medium and small businesses must cooperate to find solutions. 
Chief executive officers must be aware of the extent of their 
companies' Y2K exposure. Companies must develop contingency plans. In 
fact, this is a critical issue right now. It doesn't mean you ought to 
stop remediation, but if you are concerned that you are not going to be 
able to get ready in 304 days, you ought to be actively involved in 
looking at contingency planning.
  If there were no other message I could leave our colleagues with, or 
others who may be following this discussion today, the most important 
point I would like to make is the need for contingency planning. I 
can't think of anything more important. You ought to know how important 
contingency planning will be.
  They also must insist that vital suppliers and vendors resolve their 
own problems and have their own contingency plans in place. The true 
heroes on January 1, 2000, will be those organizations, private and 
public companies--small, medium and large--that have found a way to 
adapt to this potential problem. A business owner who wants to prosper 
in the new millennium must prepare for the Y2K problem in such a way 
that the business--that their business, his or her business--does not 
skip a beat come New Year's Day.
  As of today, as I have said repeatedly now today, we have 304 days 
remaining, but much can still be done in that time, as short as it is.
  If you have lived in the Southeast of our country where there are 
hurricanes on almost an annual basis, or the Midwest and South where 
tornadoes are common, you may have heard warnings that gave you little 
time to make survival decisions. The year 2000 is a storm on the not-
too-distant future horizon. It is a disaster, in some cases pervasive 
throughout the First World and beyond, but is one for which we can 
prepare.
  It is one that we can work to neutralize. We on this committee have 
been assessing all that we can to understand more about this coming 
storm, and we have learned a great deal. Small businesses do not have 
any compliance plans in place.
  Preparation for the continued health of our Nation's businesses and 
industries is vital, but paramount is the health of our health care. It 
is not an exaggeration to say that lives could be lost as a result of 
this crisis. I point to disturbing examples of what could happen 
relative to health care and the Y2K issue not to be an alarmist, quite 
the contrary, but to shed light on something that needs the attention 
of everyone in this country. Sixty million people are dependent on 
medication for the treatment of health problems from cancer to heart 
disease. Some require daily doses of life-sustaining medicines to keep 
their bodies from rejecting transplanted organs or to prevent cancers 
from spreading.
  Let me just cite one example of what I am talking about of which this 
committee has become keenly aware. Laurene West is a registered nurse 
and a computer expert. She brings together some wonderful talents. And 
if you were to meet her, you would see a seemingly healthy woman. Were 
it not for the fact that I tell you now, you would never guess that her 
state of health will put her more at risk than any of us when the year 
2000 arrives. Ms. West had a tumor removed from her brain and requires 
daily medication to prevent the regrowth of that tumor.
  During her first of 13 surgeries, she developed a staph infection 
that does not respond to any known oral antibiotic. She is dependent on 
IV antibiotics which she cannot store because they have no shelf life. 
Any disruption to the supply of these antibiotics could be fatal to 
her. She knows health care. She knows computers. And she knows all too 
well the impact that the year 2000 could have on her health care.
  Ms. West has been the most proactive voice calling upon us to take 
action. She worries that HMOs and physicians, to a certain extent, view 
the impending crisis with a degree of disbelief and apathy. Many health 
insurance organizations will not pay for the storage of even the most 
critical of drugs. We now are aware that as much as 80 percent--80 
percent--of the ingredients of drugs manufactured in the United States 
of America come from overseas.
  Let me repeat that. As much as 80 percent of the ingredients of drugs 
manufactured in this country come from overseas. Foreign companies 
account for 70 percent of the insulin market in the United States. 
Unfortunately, patients have been prevented from stocking lifesaving 
drugs because of restrictions placed on pharmacists by insurers and 
physicians who may not fully understand the magnitude of this problem. 
Ms. West has brought this to our attention. We applaud her efforts, and 
we are going to try to do something about her case and cases like it.
  Health care is this Nation's single largest industry. It generates 
$1.5 trillion annually. There are 6,000 hospitals in America, 800,000 
physicians, and

[[Page 3326]]

50,000 nursing homes, as well as hundreds of biomedical equipment 
manufacturers, health care insurers, suppliers of drugs and bandages 
that may be unprepared for the year 2000. According to the Gartner 
Group, 64 percent of our Nation's 6,000 hospitals have no plans to test 
their Y2K preparedness. About 80 to 85 percent of doctors' offices are 
said to be unaware of the Y2K problem.
  Struggling compliance efforts by the Health Care Finance 
Administration and unaddressed concerns about medical devices are major 
roadblocks to the industry's year 2000 readiness. In short, the health 
care industry is one of the least prepared with 304 days to go for 
dealing with the Y2K problem and carries, in my opinion, the greatest 
potential for harm at this juncture. Due to limited resources and a 
lack of awareness, rural and inner-city hospitals are particularly at 
high risk.
  Each industry we have examined is critical to the functioning of our 
society. We have all heard the analogies about making a phone call on 
December 31 around midnight and getting the bill the next month with a 
charge for 100 years of long-distance calls. But what if the phone 
doesn't work at all; what if you lose contact with your work, your 
family doctor, your 911 dispatcher. Think what would happen if the 
ability to communicate was taken from governments, militaries, 
businesses and people.
  The U.S. has never experienced a widespread telecommunications 
outage, yet the telecom network is one of the most Y2K-vulnerable 
systems. And while 95 percent of telephone systems are expected to be 
compliant in time, there is no industry-wide effort to test data 
networks, cellular and satellite communications systems or the Nation's 
1,400 regional telecom carriers. Despite telecom infrastructure 
readiness, customer equipment and company switchboards may experience 
some problems, leaving no guarantee of getting a dial tone on January 
1.
  A forum that included the Nation's largest telecom companies was 
formed in 1997 to address the year 2000 concerns and was early, to 
their credit, in formulating a compliance plan. We are awaiting a final 
industry report which is expected early this year.
  With all of our assessment, research and hearings, we have learned a 
great deal about many sectors of our infrastructure. We have learned 
who is compliant and who is making headway, who is lagging behind, and 
who has failed to disclose their status. We discuss and recommend 
legislation to move the process forward, and we must look hard into the 
mirror. The Federal Government should be setting an example, in our 
view, for the rest of our country in preparing for the Y2K issue, yet 
the Federal Government's Y2K preparations vary widely.
  The Social Security Administration, for instance, got an early start 
and is well prepared--we commend them for their efforts--while other 
agencies such as the Department of Defense and the Health Care Finance 
Administration are lagging somewhat behind. The Federal Government will 
spend somewhere, we are told, between $7.5 billion--and I apologize for 
the disparity --and $20 billion. I would like to make that number more 
definitive for you, but we are getting wide-ranging cost figures here. 
Those are the numbers we are being told just for the remediation at the 
Federal agencies, but it will not be able to renovate, test, and 
implement all of its critical missions in time. After a late start, the 
Federal Emergency Management Administration is now engaged in national 
emergency planning in the event of year 2000 disruptions, but many 
State and local governments are not prepared to deliver critical 
services such as benefit payments, 911, and emergency services.
  Both Senator Bennett and I have had a particular interest in small 
businesses. This is because small businesses fulfill such a crucial 
role in our Nation's economy, providing 51 percent of the total private 
sector output. Small businesses are absolutely vital to the economic 
well-being of our Nation. There are approximately 14 million small 
businesses in the United States today and, according to the NFIB 
Education Foundation, nearly a quarter of these 14 million businesses 
haven't spent a dime on year 2000 remediation. Fifty-five percent of 
them correspond with suppliers via electronic interaction and 17 
percent say that they would lose at least half their sales or 
production if automated processes were to fail. Many of these companies 
are playing wait and see--in reality, gambling that the problems are 
small, or at least they will be able to repair the damage before they 
go out of business.
  In our February 5 hearing, we heard testimony from Mr. Ken Evans, 
president of the Arizona Farm Bureau Federation. Part of the 
responsibility of his organization is to look out for a type of small 
business that is literally the bread and butter of our country--the 
family farm. Some reports have indicated that these small businesses 
may not be affected by the year 2000 problem since few of the systems 
used by family farms are automated. However, as Mr. Evans pointed out 
before our committee hearing, smaller farms rely heavily on vendors, 
telecommunications services, bankers, and transportation companies that 
are all highly automated.
  I know the Presiding Officer in the Chair comes from one of our rural 
States and knows better than most about just what I have said here, 
that people have sort of a mythological perception about the family 
farm and how it works. But today to succeed as a family farmer you have 
to be connected with these other vehicles to provide the services you 
need and to get your products and produce to the consumers.
  The smooth functioning, as Mr. Evans pointed out, of day-to-day 
business on the small farm requires that phones work, the refrigeration 
is in service, and the transportation services are available.
  In general, we think the level of preparedness seems to be determined 
by the relative size of the business or by how much the business is 
regulated by State and Federal agencies. While the heavily regulated 
insurance, investment, and banking industries are the furthest ahead in 
the Y2K compliance efforts, health care, oil, education, agriculture, 
farming, food processing, and the construction industries are lagging 
behind.
  The cost to regain lost operational capability for mission-critical 
failures will range, we are told, from $20,000 to $3.5 million per 
business, depending upon the size of your company. It is estimated that 
it will take an average of 3 to 15 days to fix the problems. Large 
companies with greater resources, of course, are better able to deal 
with the year 2000 problem. Small and medium-sized businesses, however, 
are the most vulnerable to the year 2000 disruptions. One survey shows 
that more than 40 percent of 14 million small businesses do not have 
any compliance plans in place.
  Mr. President, I am only going to speak briefly about the problem of 
litigation. I already mentioned my concerns about this and my desire 
for legislation. I think the price tag of $500 billion to $1 trillion 
speaks for itself. That would be a staggering cost to our Nation, not 
to mention to the individual businesses that may be the subject of 
litigation. It would be contrary, in my view, to our goal of 
preparation, to walk blindly into the next year without taking into 
consideration the question of litigation reform.
  Any reform would have to be, in my view, specific. It ought to be 
bipartisan, especially considering this is a very unusual circumstance. 
There is no established precedent upon which to rely in making 
recommendations for reform. Reform would have to be narrowly tailored, 
in my view, for a very specific purpose. It would have to encourage 
businesses and organizations to seek solutions and disclose progress 
without fear of litigious retribution. At the same time, companies and 
organizations must not be allowed to choose to do nothing and escape 
responsibility. We will be looking at this in the coming weeks. 
Clearly, much is left to be resolved.
  Again, Senator Bennett has spoken about the interconnected 
relationships of governments, all organizations, all companies and 
people. To say that everything is connected is to put simple

[[Page 3327]]

words to a very complex reality. To those chief executive officers who 
have told us that their Y2K exposure is nonexistent, due to early 
planning and remediation efforts, I would only ask: What will you do if 
power is disrupted on the grids? What will you do if you cannot ship 
products? What will you do if your vendors are not Y2K compliant? To 
government leaders at the local and State level who have not planned 
for this, we would ask: What will you tell the people you serve if 
their government cannot function? To those HMOs and physicians who are 
not anticipating a Y2K-related problem, my question to you is: What 
will happen if you are wrong and you do nothing?
  Even if our country solves this problem, the fact that many of our 
industry sectors are tied closely to international businesses and 
economies will have an unknown effect on all of us. Plants grown 
overseas affect the supply of pharmaceuticals here. America imports 
goods ranging from produce to electronic equipment. How will our 
economy be affected if some of these products do not arrive on our 
shores? The fact is, what I am saying here, and what Senator Bennett 
has said over and over again, is we are all in this together. You are 
not protected by geographical boundaries, by political entities, or by 
lamenting what is not happening offshore.
  There is a storm on the horizon. We have seen the warning signs. The 
question is, do we have the ability to weather this storm? We think we 
do, but we have to work hard and all of us need to work together. In 
weathering this potential storm, we need to continue to look closely at 
the sectors of infrastructure that we have reported on in this interim 
report. We need to work closely with our international neighbors who 
are of particular interest to the United States, both economically and 
politically, in order to better assess their problems and better 
anticipate the effect that problems in their countries will have on us.
  Our list of priorities for the coming months include the following: 
We need to revisit the domestic industry and infrastructure sectors 
first examined last year. As I indicated, we need to place increased 
emphasis on international Y2K preparedness. We hope to identify 
national and international security issues and concerns, some of which 
we have been briefed on even as late as today, as Members of this body, 
by the respective agencies of our Federal Government. We will continue 
to monitor Federal Government preparedness, but also turn our attention 
more to State and local government preparedness. Evaluating contingency 
emergency preparedness and planning is a high priority for this year. 
We need to determine the need for additional Y2K implementation or 
delaying implementation dates of new regulations.
  I should have made note, by the way, when speaking about our paying 
attention to local governments and to municipalities, our colleague 
from New York, who I think is going to come shortly to the floor, has 
raised the issue.
  Here he is. He has already raised the issue of how we might help the 
municipalities and State governments, and I commend him once again for 
bringing to this chamber the kind of vision he historically has brought 
on so many other matters. I leave it to the Senator from New York to 
discuss his ideas in that regard, and I leave him to comment on those 
matters.
  In closing, I want to reiterate the words of our colleagues when they 
said we must work together. We must not let our differences keep us 
apart. If we are going to cooperate, if we are going to keep this from 
becoming a larger problem than it has to become, then the finger-
pointing and name-calling and recriminations that can often be 
associated with this kind of an issue need to be eliminated entirely.
  Again, I commend my colleague from Utah who has led this effort so 
well over the past year or two--several years, now. I am very, very 
confident that, whatever else may happen, we will be doing our very 
best in these coming 10 months to keep our colleagues and the American 
public well informed about this issue, raising concerns where we think 
they are legitimate, not engaging in the hyperbolic kind of rhetoric 
that can create a panic which poses its own set of problems, but to be 
realistic with people, backup what we say with the kind of evidence we 
think is important for the American public and others to have as we try 
to work our way through this issue.
  With that, I reserve the remainder of my time and am glad to yield to 
my colleague from New York. I apologize, I didn't see him come in 
earlier or I would have yielded to him earlier.
  The PRESIDING OFFICER (Mr. Crapo). The senior Senator from New York.
  Mr. MOYNIHAN. Mr. President, I rise in the first instance to 
congratulate the chairman of our committee and his vice chairman for 
the extraordinary work they have done in less than a year. I make the 
point, it is a point of Senate procedure, that it is rare there is a 
chairman and vice chairman, not chairman and ranking member. This has 
been a wholly bipartisan effort from the first, and I think we can see 
that from the results in so brief a span.
  The issue has been with us for some while, and it would be derelict 
of me not to mention that it was brought to my attention by a dear 
friend from New York, a financial analyst, John Westergaard, who began 
talking to me about the matter in 1995. On February 13 of 1996, I wrote 
to the Congressional Research Service to say: Well, now, what about 
this? Richard Nunno authored a report which the CRS sent to me on June 
7 saying that ``the Y2K problem is indeed serious and that fixing it 
will be costly and time-consuming. The problem deserves the careful and 
coordinated attention of the Federal Government, as well as the private 
sector, in order to avert major disruptions on January 1, 2000.''
  I wrote the President, on July 31 of that year, to relay the findings 
of the CRS report and raise the issue generally. And, in time, a 
Presidential appointment was made to deal with this in the executive 
branch, to which I will return. But last spring--less than one year 
ago--the majority leader and the minority leader had the perception to 
appoint this gifted committee, with its exceptional staff, and now we 
have its report before us.
  Two points, followed by a coda, if I may. Shortly after the 
committee's establishment, Senator Bennett and I convened a field 
hearing--on July 6--in New York in the ceremonial chamber of the U.S. 
Federal Court House for the Southern District of New York at Foley 
Square. We found we were talking to the banks, the big, large, 
international banks in the city, and the stock exchange. And we found 
them well advanced in their preparations regarding this matter. I think 
my colleague from Connecticut would agree. They were not only dealing 
with it in their own terms, they had gone to the Bank for International 
Settlements in Basel where a Joint Year 2000 Council had been 
established at our initiative. They were hard at work on their own 
problems. They were worried about others.
  One witness told us that 49 Japanese banks planned to spend some $249 
million as a group on Y2K compliance; 49 banks are thinking of spending 
in combination $249 million. Citicorp was planning $600 million, and it 
already expended a goodly share of that.
  Indeed, it was not all our initiative, but certainly it was 
serendipitous, if I can use that term, that the security industry 
commenced massive testing just a week later--on July 13, 1998. The 
tests went very well. The industry was on to this subject. The point 
being, if you are on to this, you can handle it. It is those who aren't 
who will leave us in the greatest trouble. There will be another 
industry-wide test later this month. So much for private initiative.
  We should be grateful for what we have learned, here and abroad. As 
the Senator from Utah and the Senator from Connecticut have made clear, 
there are countries that have understood this, as we have done, and are 
on top of this. But there are too many other countries that don't know 
the problem exists or might as well not.
  As a sometime resident in India, I was interested to find that Indian 
enterprises, concentrated in the Bangalore area, are very much involved 
in

[[Page 3328]]

doing the computer remediation. If you would like to know something 
about the world we live in, Mr. President, the work for the day is sent 
to them from San Francisco or New York or Chicago; they do it 
overnight, which is not overnight for them, it is the daytime, and it 
is back on our desks in the morning. It is that kind of world we live 
in.
  Hence, to the second subject, which is the nuclear one. There is 
potential here for the kind of unintended disaster of an order we 
cannot describe in terms of medical care or financial statements or, 
for that matter, air travel at New Year's--which is to say that the 
failure of computer systems in Russia to give the correct information 
about early warning systems, such that 6,000 nuclear warheads still in 
Russia are not inadvertently launched. They could be, you know. They 
are in place--not all--but enough. A hundred would do. Three would be a 
calamity. Two were dropped on Japan and ended the Second World War. 
These are all huge weapons, far above the tonnage and of a different 
chemical composition than the early atomic bombs, as we have come to 
know them.
  The Russians seem to know they have a problem--or they may have a 
problem. Or they don't know whether they do or they don't. In that 
situation, ``we didn't quite catch it'' could bring incomprehensible 
catastrophe just at the moment when we thought that long, dark half a 
century was ended, the half century that began in 1946, when the 
Soviets exploded their first nuclear device.
  We have a danger here and we have an opportunity, and we ought to 
respond to the one and seize the other. We are given to understand that 
our Department of Defense officials have begun some negotiations, 
discussions in Moscow to invite a Russian team to Colorado Springs--
where it happens our facilities in these regards are located--to let us 
watch each other's nuclear launches, nuclear alerts, false alarms.
  We can think, Mr. President, that this was something behind us, 
surely a matter of passing. It wasn't. We have learned just recently 
that in 1983, one Soviet officer, a Stanislav Petrov, a 44-year-old 
lieutenant colonel, was in the Serpukhov-15 installation where the 
Soviet Union monitored its early warning satellites over the United 
States, and all of a sudden the lights began to flash ``Start,'' 
because the warning time is very short.
  He made a decision on his own: they only supposed that they had 
picked up a launching; the equipment picked up five ICBMs. Mankind was 
spared by one lieutenant colonel in the Soviet Army who knew enough 
strategic doctrine to know that the United States would never launch 
five. It might launch 5,000. So as the information went up, by the 
nanoseconds, through the chain of command, it was decided not to launch 
a counterstrike.
  That is how close we came, probably never in a more mortal way. He is 
still alive and has told his tale. I ask unanimous consent that at the 
end of my remarks David Hoffman's account of this in the Washington 
Post be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See Exhibit 1.)
  Mr. MOYNIHAN. Mr. President, I suggest that we seek to reach an 
agreement for the Russians to come and bring with them all their codes 
and their classified communications modes, learn what our early warning 
system is, tell us what they will of theirs, perhaps be open about its 
own weaknesses, which are so great. These are the people who still have 
the fate of mankind in their hands, and they haven't been paid in 6 
months. What they talk about, evidently, is the need for money. How in 
God's name we cannot provide it, I fail to see. The maintenance of our 
nuclear system in the course of a half century cost $5.5 trillion. I 
sometimes forget this, but in my years on the Finance Committee, I have 
learned that a billion minutes ago, Saint Peter was just 30 years dead. 
A billion is a large number. A trillion is beyond our capacity. They 
are asking thousands of millions. Very little.
  I hope Beijing might want to join. I would invite Islamabad and New 
Delhi, places which are unstable and have nuclear devices. Out of that, 
Mr. President, out of this immediate crisis, we might find a longrun 
institution or institutions--they need not be here, exclusively--they 
can be in many places--in which we would monitor one another's nuclear 
activity while, pray God, we develop it down, and relearn the 
confidence-building measures that were so important in the cold war. 
That telephone between the Kremlin and the White House made more of a 
difference than we probably know. It is this kind of thing.
  I note to my dear friends--and I will get complete agreement--this 
body has known fewer persons with a greater understanding of the cold 
war than Senator Sam Nunn and the late Senator Henry Jackson who, in 
the early 1980s, brought up the concept of a joint early warning 
system. And then the MX was deployed, and we moved from essentially a 
deterrence position on nuclear matters, a second-strike, if you will, 
to a first-strike capacity, such that the Soviet systems had to be 
constantly alarmed.
  Now, maybe that idea of Senators Nunn and Jackson will come, come at 
last. I would hope for two things. And I do not want to impose, and I 
do not want to presume, but I will do. This is not a time for too much 
delicacy.
  I would hope that our chairman and vice chairman--I make that point: 
the Intelligence Committee and, I believe, the Ethics Committee have a 
chairman and vice chairman; all the rest is majority rule around here, 
which is fine, but this is bipartisan--if they might find it possible 
to visit Moscow and talk with members of the Duma there where the START 
II treaty, which we took all the 1980s to negotiate, lies unratified. 
And our plans for START III are, accordingly, on hold. They might go or 
they might invite--some action from the Congress, I think, is in order. 
And it would be no harm to point out to the Russian Government that 
they now have a legislative branch. And if it acts in ways that are not 
always agreeable to the executive, well, that is not an unknown 
phenomena. It has been going on for two centuries in the United States. 
It is an important and necessary initiative we ought to somehow pursue.
  One final point. I hope my friends will not feel I am trespassing on 
their--our concerns, as I am a member and am honored to be a member of 
the committee--the Pentagon is too much disposed to discuss this matter 
in secret session. This is a time for more openness. This is a time the 
American people can be trusted with information which the Russian 
authorities already have.
  One of the phenomenons of the cultural secrecy which has developed 
over the last century is that the U.S. Government is continuing to keep 
information from us which our adversaries know perfectly well. It is 
only we who do not know. This has done a perceptible harm to American 
democracy. We have no idea how distant it is from the beginning of the 
century when Woodrow Wilson could proclaim, as a condition of peace to 
conclude the First World War, ``open covenants openly arrived at.''
  Now, mind you, that same President Wilson, to whom I am devoted, in 
the day after he asked for a declaration of war, he sent a series of 17 
bills, which were rolled together and called the Espionage Act. It 
provided for prior restraint, as lawyers call it, censorship of the 
press. First Henry Lodge, on this floor, the chairman of the Foreign 
Relations Committee, said, ``Yes, I think that is a good idea.'' The 
next day he came back and said, ``You know, I don't think it's a good 
idea. The press should be free in this country.''
  President Wilson wrote the bill manager on the House side, and said, 
``Please keep it.'' It was not kept. But it was assumed it was kept, so 
much so that when the Pentagon Papers were released, the executive 
branch of our Government just assumed that was a crime and proceeded to 
prevent their publication and find out more about the person who had 
released them. And the next thing you know, we had an impeachment 
hearing in the Federal Government--a crisis that all grew out of 
secrecy and presumptions of secrecy.

[[Page 3329]]

  I would hope--I doubt there is anybody in the Pentagon listening, but 
I see the chairman and vice chairman listening--I would hope they would 
say we could have an open briefing. The American people will respond 
intelligently to dangers of which they are appropriately apprised. And 
this surely is one.
  But, sir, I have spoken sufficiently. I beg to say one last thing. On 
the House side, our colleague and friend, Representative Stephen Horn 
of California, has been very active producing ``report cards'' on the 
status of the different departments of the Government and keeping it up 
regularly. As the Senator from Connecticut observed, the Social 
Security Administration got A's all along. Others have not.
  It would not be a bad idea for the chairmen and ranking members of 
our standing committees to review Representative Horn's report cards 
and keep an eye on the departments that report to them.
  Other than that, I think I have spoken long enough. I do not think, 
however, I have sufficiently expressed my admiration and at times awe 
of the performance of our chairman and vice chairman. The Senate is 
grateful, is in their debt. So is the Nation. The Nation need not know 
that; it just needs to pay attention to their message, sir.
  Mr. President, I yield the floor.

                               Exhibit 1

               [From the Washington Post, Feb. 10, 1999]

   ``I Had a Funny Feeling in My Gut''--Soviet Officer Faced Nuclear 
                               Armageddon

                           (By David Hoffman)

       Moscow--It was just past midnight as Stanislav Petrov 
     settled into the commander's chair inside the secret bunker 
     at Serpukhov-15, the installation where the Soviet Union 
     monitored its early-warning satellites over the United 
     States.
       Then the alarms went off. On the panel in front of him was 
     a red pulsating button. One word flashed: ``Start.''
       It was Sept. 26, 1983, and Petrov was playing a principal 
     role in one of the most harrowing incidents of the nuclear 
     age, a false alarm signaling a U.S. missile attack.
       Although virtually unknown to the West at the time, the 
     false alarm at the closed military facility south of Moscow 
     came during one of the most tense periods of the Cold War. 
     And the episode resonates today because Russia's early-
     warning system has fewer than half the satellites it did back 
     then, raising the specter of more such dangerous incidents.
       As Petrov described it in an interview, one of the Soviet 
     satellites sent a signal to the bunker that a nuclear missile 
     attack was underway. The warning system's computer, weighing 
     the signal against static, concluded that a missile had been 
     launched from a base in the United States.
       The responsibility fell to Petrov, then a 44-year-old 
     lieutenant colonel, to make a decision: Was it for real?
       Petrov was situated at a critical point in the chain of 
     command, overseeing a staff that monitored incoming signals 
     from the satellites. He reported to superiors at warning-
     system headquarters; they, in turn, reported to the general 
     staff, which would consult with Soviet leader Yuri Andropov 
     on the possibility of launching a retaliatory attack.
       Petrov's role was to evaluate the incoming data. At first, 
     the satellite reported that one missile had been launched--
     then another, and another. Soon, the system was ``roaring,'' 
     he recalled--five Minuteman intercontinental ballistic 
     missiles had been launched, it reported.
       Despite the electronic evidence, Petrov decided--and 
     advised the others--that the satellite alert was a false 
     alarm, a call that may have averted a nuclear holocaust. But 
     he was relentlessly interrogated afterward, was never 
     rewarded for his decision and today is a long-forgotten 
     pensioner living in a town outside Moscow. He spoke openly 
     about the incident, although the official account is still 
     considered secret by authorities here.
       On the night of the crisis, Petrov had little time to 
     think. When the alarms went off, he recalled, ``for 15 
     seconds, we were in a state of shock. We needed to 
     understand, what's next?''
       Usually, Petrov said, one report of a lone rocket launch 
     did not immediately go up the chain to the general staff and 
     the electronic command system there, known as Krokus. But in 
     this case, the reports of a missile salvo were coming so 
     quickly that an alert had already gone to general staff 
     headquarters automatically, even before he could judge if 
     they were genuine. A determination by the general staff was 
     critical because, at the time, the nuclear ``suitcase'' that 
     gives a Soviet leader a remote-control role in such decisions 
     was still under development.
       In the end, less than five minutes after the alert began, 
     Petrov decided the launch reports must be false. He recalled 
     making the tense decision under enormous stress--electronic 
     maps and consoles were flashing as he held a phone in one 
     hand and juggled an intercom in the other, trying to take in 
     all the information at once. Another officer at the early-
     warning facility was shouting into the phone to him to remain 
     calm and do his job.
       ``I had a funny feeling in my gut,'' Petrov said. ``I 
     didn't want to make a mistake. I made a decision, and that 
     was it.''
       Petrov's decision was based partly on a guess, he recalled. 
     He had been told many times that a nuclear attack would be 
     massive--an onslaught designed to overwhelm Soviet defenses 
     at a single stroke. But the monitors showed only five 
     missiles. ``When people start a war, they don't start it with 
     only five missiles,'' he remembered thinking at the time. 
     ``You can do little damage with just five missiles.''
       Another factor, he said, was that Soviet ground-based radar 
     installations--which search for missiles rising above the 
     horizon--showed no evidence of an attack. The ground radar 
     units were controlled from a different command center, and 
     because they cannot see beyond the horizon, they would not 
     spot incoming missiles until some minutes after the 
     satellites had.
       Following the false alarm, Petrov went through a second 
     ordeal. At first, he was praised for his actions. But then 
     came an investigation, and his questioners pressed him hard. 
     Why had he not written everything down that night? ``Because 
     I had a phone in one hand and the intercom in the other, and 
     I don't have a third hand,'' he replied.
       Petrov, who was assigned to the satellite early-warning 
     system at its inception in the 1970s, said in the interview 
     that he knew the system had flaws. It had been rushed into 
     service, he said, and was ``raw.''
       Petrov said the investigators tried to make him a scapegoat 
     for the false alarm. In the end, he was neither punished nor 
     rewarded. According to Petrov and other sources, the false 
     alarm was eventually traced to the satellite, which picked up 
     the sun's reflection off the tops of clouds and mistook it 
     for a missile launch. The computer program that was supposed 
     to filter out such information was rewritten.
       It is not known what happened at the highest levels of the 
     Kremlin on the night of the alarm, but it came at a climactic 
     stage in U.S.-Soviet relations that is now regarded as a 
     Soviet ``war scare.'' According to former CIA analyst Peter 
     Pry, and a separate study by the agency, Andropov was 
     obsessed with the possibility of a surprise nuclear attack by 
     the West and sent instructions to Soviet spies around the 
     world to look for evidence of preparations.
       One reason for Soviet jitters at the time was that the West 
     had unleashed a series of psychological warfare exercises 
     aimed at Moscow, including naval maneuvers into forward areas 
     near Soviet strategic bastions, such as the submarine bases 
     in the Barents Sea.
       The 1983 alarm also came just weeks after Soviet pilots had 
     shot down Korean Air Lines Flight 007 and just before the 
     start of a NATO military exercise, known as Able Archer, that 
     involved raising alert levels of U.S. nuclear forces in 
     Europe to simulate preparations for an attack. Pry has 
     described this exercise as ``probably the single most 
     dangerous incident of the early 1980s.''

  Mr. BENNETT addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah is recognized.
  Mr. BENNETT. I thank the Senator from New York for his generous 
remarks. He is always generous and gracious. I never deserve all the 
nice things he says about me, but I am always glad to have him say them 
nonetheless. I am grateful on this occasion as well.


                         Privilege Of The Floor

  I ask unanimous consent that Tania Calhoun, a detailee to the 
committee, be granted floor privileges for the balance of the debate.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BENNETT. Thank you, Mr. President.
  Mr. MOYNIHAN. Mr. Chairman, would you allow me to request a similar 
privilege of the floor?
  I ask unanimous consent that Jason Klurfeld of my staff, a designee 
on the committee, have privileges of the floor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Utah is recognized.
  Mr. BENNETT. Thank you.
  In the list of questions I laid out at the beginning of my 
presentation, we are now at the point where we are asking the two 
questions: What should we be doing next and what can we expect?
  The Senator from Connecticut talked about the liability bill. I agree 
with him absolutely that we cannot take this particular emergency and 
turn it into a stealth operation to slip through other legislation, 
even though I would be for it. The Senator from Connecticut would be 
opposed to it. I would love to do that. But I think that

[[Page 3330]]

would be an inappropriate thing to try to do.
  It has just come to my attention a demonstration of why we need some 
kind of limited liability relief tied to this. I had an interview with 
an individual who is following Y2K matters, and she said, ``What are 
you going to do about insurance companies that are canceling policies 
over Y2K?'' And quite frankly, I was skeptical. I said, ``I don't know 
of any insurance companies that are canceling policies.''
  Well, she sent me one. And here it is; it arrived today. I think that 
is appropriate since this is the day we are talking about Y2K. Here--in 
an area that the Senator from Connecticut has pioneered, health care--
is an insurance company that has sent out an endorsement on one, two, 
three, four, five, six, seven, eight different health care policies 
that they write.
  They say:

       The following exclusion is added to Section III [of these 
     policies]:
       This Policy does not apply to, and the Company will not pay 
     any DAMAGES or CLAIM EXPENSES . . . arising out of, or in any 
     way involving any actual or alleged failure of any . . . 
     ``equipment'' . . . [relating to]:
       (A) any date or time after September 8, 1999;

  The reason for that, Mr. President, is because the 9th day of the 9th 
month of the 99th year could trigger four 9's in a computer program and 
cause it to fail.

       (B) any date, time, or data representing or referring to 
     different centuries or more than one century;
       (C) the change of the Year 1999 to the Year 2000;
       Or,
       (D) the Year 2000 as a leap year.

  The reason for that, Mr. President, is that the algorithm used in 
computers to compute dates--for reasons I won't take the time to 
explain--will not recognize the 29th of February, a leap year, in the 
year 2000; it recognizes it in every other leap year but it does not 
recognize it in the year 2000.
  Here is an insurance company that says, ``We will not pay any claims 
arising from these predictable Y2K kinds of problems.'' So you have 
that added burden to a company that is doing its very best to get the 
Y2K thing under control and suddenly finds that their insurance policy 
is being unilaterally canceled.
  Now, as I have said on this floor before, I am unburdened with a 
legal education, so I don't know quite how to deal with this one, but I 
am sure this is something that ought to go in the mix of what we might 
do with respect to some kind of legislation this year.
  Another thing we should be doing next--should be doing now--has to do 
with more disclosure. Here we are working very closely with the SEC. 
Chairman Arthur Levitt of the SEC has been in close touch with the 
committee, with Senator Dodd and me, as we have gone through this. The 
SEC is working very hard to get more disclosure. Unfortunately, we 
haven't had the kind of disclosure that I think shareholders are 
entitled to in this area. This is one thing we ought to keep pushing 
for. We ought to have more hearings. The Senator from New York talked 
about that.
  The authorizing committees, committees of jurisdiction, should take 
up the burden of conducting oversight hearings of the Departments that 
they have responsibility for. This has already happened. The Armed 
Services Committee of the Senate held a very useful hearing last week 
with the level of preparedness of the Secretary of Defense. I won't 
repeat all the information that was developed there because it is 
already in the Record, but there ought to be more of that going on as 
we get closer to this. The burden of paying attention to what is going 
on in the executive branch should not fall exclusively on John Koskinen 
and the President's Council on the Year 2000. It should be shared by 
the Congress. We should have more activity rather than less, as the 
Congress stays involved in this.
  Finally, we have suggested to Senators that they should meet with 
their own constituents. Senator Dodd has done this in Connecticut, as I 
have in Utah. Senator Smith has done it regularly in Oregon and as part 
of his own education as a member of this committee. But other Senators 
who are not members of the committee have been working in this way. We 
on the committee are prepared to help them in this effort. We are going 
to put together, in addition to the report that has been released 
today, talking points and guidance information for Senators who decide 
they want to hold town meetings or other meetings while they are back 
in their own home States.
  That is very worthwhile. It helps accomplish the twin goals of the 
committee: No. 1, to calm down the panic so that people are not Chicken 
Little; and, at the same time, raise the awareness in a responsible 
way. Individual Senators speaking in their individual States have a 
higher profile than speeches on the floor of the Senate. That is 
something we ought to be doing and something that our committee will do 
its very best to facilitate.
  Now, this is a moving target, as we have both said. One of the areas 
that has just come to light that we are going to need more information 
on is the chemical industry. We were assured that everything was all 
right in the chemical industry, and now we are discovering that maybe 
that is not the case. The chemical industry might replace the health 
care industry as an industry that we look at. This is going to require 
us to pay attention through the remainder of this year, which is why 
the resolution funding the committee for the coming year is the subject 
of this debate.
  There have been some questions, by the way, raised as to: Where is 
this money coming from, and how is Senator Bennett going to pay for it? 
Where is the offset? I can assure all Senators, this is part of the 
overall allocation of Senate business. This is not new money; this is 
money that is already in the budget. It is just being allocated to this 
committee as opposed to some other use. We do not have to come up with 
an offset for it under the Budget Act. For those who are concerned 
about that, I assure you that is not of concern. It is a little 
heartening and indicates that Senators are indeed watching this on 
their television sets in their own offices. They are making these phone 
calls. If they weren't calling the cloakroom asking this, then we would 
know they were not paying attention.
  The final question which we get all the time with respect to Y2K--
Senator Dodd gets it, I am sure; I get it almost everywhere I go--What 
can we expect? Are we going to be all right? We addressed this in our 
opening remarks in saying yes, we are probably going to be all right, 
generally. The United States is going to have some problems, but it is 
not going to be the end of the world as we know it.
  I want to now focus on what I think we can expect outside of the 
United States, because that is the area of greatest concern as we have 
gone through this situation. There are far too many countries in the 
world where Y2K has not been given the kind of attention it deserves. 
Recently, to his credit, John Koskinen, the President's Y2K czar, 
working with officials at the United Nations, helped put together a Y2K 
Day at the United Nations and invited the Y2K coordinators from all of 
the countries around the world to come to New York and participate in 
this discussion at the United Nations. I went to New York, along with 
Congressman Horn, to represent the legislative branch there and 
demonstrate that it was not just the executive branch of the Government 
that was concerned about this.
  There was a very heartening turnout. A large number of countries sent 
Y2K coordinators. It was a very useful day. That is the good news. The 
bad news is that many of these Y2K coordinators didn't know anything 
about Y2K up to about 2 weeks before they were appointed coordinator 
and given a ticket to New York. They had no idea what this was about. 
The fact that the United Nations was holding a day and they were 
invited to come, their government said, ``Maybe we need a Y2K 
coordinator to go; you go; name somebody''--he or she got on the 
airplane, flew to New York, and didn't have the slightest idea what we 
were talking about. That is the bad news.

[[Page 3331]]

  The other bad news is that some of them simply could not afford a 
ticket. The World Bank funded the airline tickets for some of these Y2K 
coordinators, which raises the demonstration of the problem we have in 
many countries around the world. As our consultants have spanned out 
and talked to these people, many of them say, ``We recognize we have a 
problem; we recognize it is very serious. We are completely broke. What 
do you suggest we do about it? We simply can't afford the kind of 
remediation that you are going through in the United States.''
  We just had a team of consultants that came back from Russia and they 
did a very valid job of assessing where things are in that country. But 
they said every official that they spoke to began the conversation by 
asking for money. Every single one said, ``We have a problem. Now, can 
you help us solve it, because we can't afford to do anything about 
it.'' Senator Moynihan was talking about the Russian military not 
having been paid for months and months, and they say, ``If we haven't 
got any money to pay to our military, we don't have any money to deal 
with the Y2K problem.''
  What will be the impact? There will be economic dislocation in many 
countries as a result of this. In some countries it will be more 
serious than others. The unknowable question is, What will be the 
impact on the United States? I cannot quantify that for you, but I will 
give you this overall assessment. I think Y2K will trigger what the 
economists call a ``flight to quality.'' That is, I think investors 
around the world, as they decide that infrastructure problems are going 
to arise in certain countries, will decide as a matter of prudence on 
their part, to withdraw their financial support for economic activity 
in that country, which will cripple the country further. The speed with 
which money moves around the world is now very different than it used 
to be as recently as 10 or 15 years ago. It used to be when there was 
foreign investment in a country, getting that investment out meant 
couriers going through airports with attache cases filled with crinkly 
pieces of paper handcuffed to their wrists.
  Senator Dole assigned me to work on the Mexican peso problem in early 
1995 when the Mexicans devalued the peso. The flight of foreign 
investment from Mexico took place in a matter of hours, and it was all 
done electronically--a few keystrokes at a keyboard and the money was 
gone. The speed with which foreign investment fled Mexico stunned a 
number of economists who had no idea that the foreign money would 
disappear virtually overnight.
  I think you are going to see that kind of thing repeated as foreign 
investors say: Our Y2K assessment says Country X's infrastructure is 
going to fail, their power system is going to go down, their 
telecommunications system will fail and they won't be able to function. 
Even though we are confident in the management of the company we are 
backing in that country, we can't run the risk of having them shut down 
because of an infrastructure failure. We are going to call the loan, 
sell the stock, and do whatever is necessary to get our money out 
before it really hits.
  This ``flight to quality'' may very well mean that the rich get 
richer and the poor get poorer as a result of Y2K, which raises the 
other two unknowables, but that we need to be concerned about: One, 
civil unrest in some of these countries and what that might mean to 
their economies and their place in the world markets; second, 
humanitarian requirements.
  I say, somewhat facetiously, that we have foreign policy by CNN in 
this country. That is, when the CNN cameras go into a particular area 
of the world and send images back to the United States, we then 
respond. CNN cameras showed starving children in Somalia and George 
Bush sent in troops. I am not criticizing that decision to send in 
troops, but I wonder if there might not have been starving children in 
other parts of Africa that CNN didn't get into and that was the reason 
we didn't intervene in those countries as well. I have a nightmare of 
CNN cameras in villages or cities where there is no power, no 
telecommunications, the banking system is broken down, widespread 
rioting, and then the request is: What is the United States going to do 
about it? The United States has its Y2K problem under control--the 
richest country in the world--and we will be faced with the 
humanitarian challenge of some real hardship in some real areas.
  So, again, Mr. President, that is one of the reasons why the special 
committee on year 2000 should be funded and continued, so that we can 
monitor these things in the way we have in the past and provide 
information and guidance to policymakers who have come to depend upon 
us as a repository of information in this whole situation.
  Mr. DODD. Will the chairman yield?
  Mr. BENNETT. Yes, I am through with my formal statement.
  Mr. DODD. I see that our colleague is here, and I won't be long.
  First, I want to commend Senator Moynihan from New York for an 
excellent statement. He has been a real value to us on the committee. 
He brings such a wealth of knowledge, information and experience. I 
thought his observation about at least some of the material the Defense 
Department has is a worthwhile suggestion. We might want to explore how 
to make more of that information available to the general public. I 
think those who are skeptical about whether or not there is legitimacy 
in pursuing this committee and making the information available as we 
require it, their concern would be further dispelled were they to have 
the ability to share some of the information we have come across.
  I commend my colleague from Utah. I think this memo where he has left 
off the name--and I will respect that as well here, although I will 
point out that it is not a Connecticut company. Most people would 
assume that since it is an insurance company, it is probably located in 
Connecticut; but it is not. We may want to compose a letter to send to 
the industry as a whole. I would be very curious as to whether or not 
this is a unique, isolated case, or whether or not it is being 
duplicated by others.
  For those who may not have heard this, we have come across a memo 
which details a number of different kinds of health care policies that 
would be significantly affected. In fact, they would be excluded from 
payment if, in fact, the damages occur ``as a result of failure of any 
machine, equipment, device, system, or component thereof, whether it is 
used for the purposes or whether or not the property of the insurer to 
correctly recognize, accept, and process or reform any function: any 
date or any time after September 8, 1999, to January 1.''
  Clearly, this is the insurance companies saying ``we are not covering 
you here on this one,'' which is a very important piece of information. 
I think we ought to examine and look at that.
  This is an early version of OMB's March report that we have been 
given which rates the Federal agencies in terms of their year 2000 
compliance. Basically, there is good news here, Mr. President. An awful 
lot of agencies are doing pretty well. Some have a long way to go here. 
I think this may be a worthwhile item to be included in the Record.
  I ask unanimous consent that Predictions by Country and Worldside 
Predictions by Industry be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                         PREDICTIONS BY COUNTRY
------------------------------------------------------------------------
          Rate (percent)                          Country
------------------------------------------------------------------------
15...............................  Australia, Belgium, Bermuda, Canada,
                                    Denmark, Holland, Ireland, Israel,
                                    Switzerland, Sweden, United Kingdom,
                                    United States.
33...............................  Brazil, Chile, Finland, France,
                                    Hungary, Italy, Japan, Korea,
                                    Mexico, New Zealand, Norway, Peru,
                                    Portugal, Singapore, Spain, Taiwan.
50...............................  Argentina, Armenia, Austria,
                                    Bulgaria, Columbia, Czech Republic,
                                    Egypt, Germany, Guatemala, India,
                                    Japan, Jordan, Kuwait, Malaysia,
                                    Poland, Puerto Rico, Saudi Arabia,
                                    South Africa, Sri Lanka, Thailand,
                                    Turkey, U.A.E., Venezuela,
                                    Yugoslavia.
66...............................  Afghanistan, Bahrain, Bangladesh,
                                    Cambodia, Chad, China, Costa Rica,
                                    Ecuador, El Salvador, Ethiopia,
                                    Fiji, Indonesia, Kenya, Laos,
                                    Lithuania, Morocco, Mozambique,
                                    Nepal, Nigeria, Pakistan,
                                    Philippines, Romania, Russia,
                                    Somalia, Sudan, Uruguay, Vietnam,
                                    Zaire, Zimbabwe.
------------------------------------------------------------------------


[[Page 3332]]


                    WORLDWIDE PREDICTIONS BY INDUSTRY
------------------------------------------------------------------------
          Rate (percent)                          Industry
------------------------------------------------------------------------
15...............................  Aerospace, Banking, Computer
                                    Manufacturing, Insurance, Investment
                                    Services, Pharmaceuticals.
33...............................  Biotechnology, Chemical Processing,
                                    Consulting, Discrete Manufacturing,
                                    Heavy Equipment, Medical Equipment,
                                    Publishing, Semiconductor, Software,
                                    Telecom, Power, Water.
50...............................  Broadcast News, Hospitality, Food
                                    Processing, Law Enforcement, Law
                                    Practices, Medical Practices,
                                    Natural Gas, Ocean Shipping, Pulp
                                    and Paper, Television,
                                    Transportation.
66...............................  City and Town Municipal Services,
                                    Construction, Education, Farming,
                                    Government Agencies, Healthcare,
                                    Oil.
------------------------------------------------------------------------

Mr. DODD. Lastly, I don't have this with me, but I am going to ask 
unanimous consent that it be printed in the Record as well, Mr. 
President. I spent a couple of hours yesterday in my State with the 
Garner Group, a successful firm that represents 35,000 clients 
worldwide--public and private entities--and has a pretty good fix on 
what is happening at home and abroad. They have a new assessment, an 
updated assessment, an industry-by-industry assessment worldwide, 
national assessments, and for major nations around the globe as to 
where they are in all of this. I thought it might be worthwhile for the 
public and our colleagues to see that most recent information.
  I ask unanimous consent that they be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                           GOVERNMENT-WIDE SUMMARY--YEAR 2000 STATUS MISSION-CRITICAL SYSTEMS
                                                                      [In percent]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   All systems                            Systems being repaired
                                                               -----------------------------------------------------------------------------------------
                         Agency status                           Y2K  complaint      Assessment        Renovation        Validation      Implementation
                                                                       \1\            complete        complete \2\      complete \3\      complete \4\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tier Three:
    NASA, FEMA, Education, OPM, HUD, Interior, GSA, VA, SBA,                  96               100               100                99                96
     EPA, NSF, NRC, SSA.......................................
Tier Two:
    Agriculture, Commerce, Defense, Energy, Justice, Labor,                   77               100                94                83                74
     State, Treasury..........................................
Tier One:
    U.S. Agency for International, Development Health and                     63               100                98                79                42
     Human Services, Transportation...........................
All Agencies..................................................                79               100                96                87                76
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Percentage of all mission-critical systems that will accurately process data through the century change; these systems have been tested and are
  operational and includes those systems that have been repaired and replaced, as well as those that were found to be already compliant.
\2\ Percentage of mission-critical systems that have been or are being repaired; ``Renovation complete'' means that necessary changes to a system's
  databases and/or software have been made.
\3\ Percentage of mission-critical systems that have been or are being repaired; ``Validation complete'' means that testing of performance,
  functionality, and integration of converted or replaced platforms, applications, databases, utilities, and interfaces within an operational
  environment has occurred.
\4\ Percentage of mission-critical systems that are being or have been repaired; ``Implementation Complete'' means that the system has been tested for
  compliance and has been integrated into the system environment where the agency performs its routine information processing activities. For more
  information on definitions, see GAO/AIMD-10.1.14, ``Year 2000 Computing Crisis: An Assessment Guide,'' September 1997, available at http://cio.gov
  under year 2000 Documents.


  Mr. DODD. I point out to my chairman that one of the industries they 
point out that is not doing very well--it is not doing badly, but not 
very well--in terms of being Y2K compliant; it is the broadcast news 
industry, and particularly television. So when my colleague refers to 
``foreign policy by CNN,'' he is accurate, but one of the problems is 
that CNN may have a problem--and I am sure they will respond very 
quickly. But I thought it was interesting when I went over this last 
evening detailing some of the industries identified as ones that have 
work to do, and broadcast news was one that is lagging behind.
  I also see our colleague from Oregon. Before he shares his thoughts, 
I want to thank him as well. He has been a tremendous asset to our 
committee. He has brought a wonderful perspective since he joined this 
body, and comes from the public sector as well as the private sector. 
He served in the legislature in his own State with great distinction, 
but also he comes with a private sector perspective, which has been 
tremendously helpful throughout the hearings. And I thank him for his 
attention and for the time he has brought to this issue as well.
  I yield the floor.
  Mr. BENNETT. Mr. President, I join my friend from Connecticut in 
thanking the Senator from Oregon for his diligence on this committee. 
He comes to the hearings and he contributes. He pays attention. He has 
blazed a way with the meetings he held in his home State. As I say, I 
would encourage all other Senators to follow his example. I am happy to 
yield to him such time as he may require.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. SMITH of Oregon. Thank you, Mr President. I thank Chairman 
Bennett and Senator Dodd. It has been a great pleasure and a real 
privilege for me to participate in this committee with them.
  I can tell you that I sought membership on the committee when I heard 
about its creation. I sought membership not because I am some computer 
whiz--in fact, my kids are always trying to teach me new things we can 
do with it--but, frankly, because I recognized that my State, as well 
as yours, is very much focused on the development of the high-tech 
industry. Oregon has grown in high-technology in a remarkable fashion 
in the last decade. So I thought it would be important. I didn't 
realize how important it would be until feeling my oats as a member of 
this new committee.
  Last year, I held a town hall meeting in Medford, OR. We published 
notice of it. Usually at a town hall you get 20 or 30 people to show up 
who want to talk about some public policy. But we said it was going to 
be about Y2K. There were over 1,000 people who came to that meeting. I 
realized we were on to something here.
  If any of my colleagues are listening to me at this time, I would say 
to them that no matter what State you are from, if you want to get the 
attention of the people you are trying to serve, call a Y2K town hall. 
You will be amazed. And you will perform a great public service to the 
people who are becoming aware of this, mindful of it, some afraid of 
it, some panicked by it.
  What I have found in Oregon is that by going home to meet with my 
constituents and saying, ``Look, don't panic, but begin to be 
prepared,'' has had a calming effect on my State. I thank these two 
leaders in the Senate, these men who led this committee, because when 
they first began talking about this issue --and I know in the 
Republican caucus Bob Bennett was sort of Chicken Little; he is Paul 
Revere now, and I honor him and salute him as that. I think, frankly, 
Chris Dodd has done the same thing in the Democratic caucus. We all 
look to them with renewed respect, and deserved respect, because they 
have been the Paul Reveres for this country on this issue. It has been 
a great pleasure to serve with them.
  I encourage my colleagues to vote for this bill that will allow the 
committee to continue to do its wonderful work. I was proud to vote 
this morning for another bill that would allow the SBA to help small 
businesses become Y2K compliant.
  Chairman Bennett asked me to focus my service on the committee on the 
whole business industry. Having come from the private sector, I will 
tell you that businesses have a ways to go, but they are making great 
progress, because the motive of the business man or woman is to make a 
profit. I found that for a food processor, for example--whatever the 
Government standard was, it was an important standard. It was always 
the floor and was never the ceiling. And when I wanted to sell frozen 
peas, I wasn't trying to sell it to the Government, I was trying to 
sell it to Campbell Soup, whose standard is

[[Page 3333]]                    ____

much higher than those of the Government.
  So for me as a business person, when Y2K would come to my desk, I 
would say, ``How does this affect my ability to sell my product and 
make a profit?''
  So I say to all business people, this could affect your ability to 
stay in business and make a profit. So if you are interested in a 
profit, get interested in Y2K and figure out how it is that this 
computer glitch might affect either your energy supply, your financial 
services, your transportation, and your ability to communicate with the 
world. These things are all interconnected.
  I never realized as fully as I do now as a member of the committee 
just how interconnected we are as a country, and now as an entire 
world. I would predict, as others have, that our problems in this 
country will be theirs. This is real. But it will not be of a 
millennial nature, like some fear. But in some parts of the world it 
may well be. And a business man or woman is going to have to figure out 
how to deal with an international trade world that is having to adjust 
to these Y2K problems.
  I want to also say, to comfort the people out there, that the United 
States is prospering right now relative to the rest of the world in a 
remarkable way, in part because during the 1980s and the 1990s American 
industry began to retool. As we have retooled and restored our 
industrial base, we have done so with Y2K-compliant equipment and 
computerization. This will all make the bump in this country much 
smaller than it otherwise would be.
  So there are lots of reasons for optimism. But there is still much 
work to be done.
  I am just pleased to participate with my colleagues today, and I know 
that a vote is pending. So, Mr. President, without further delay, I 
encourage all of my colleagues to vote for this legislation. Today, I 
think has become something of a Y2K Day, and it does a great service to 
our whole country to alert them to the real dangers and not the 
mirages.
  In a hearing I recently held in my State, I heard a tragic story 
about a gentleman who had listened to some literature that caused him 
to panic. He went out and took all of his savings from his personal 
account, roughly $30,000. But somebody heard that he had done it and 
went and robbed him of his life savings.
  So don't panic; just simply be prepared. Find a reasonable level of 
storage for food and water for your family, take some copies of your 
financial statements, check your own computers, but don't do things 
that are unwarranted, because that will be something of a self-
fulfilling prophecy. We are not here to be self-fulfilling prophets; we 
are here to be Paul Reveres, as Senator Bennett and Senator Dodd have 
shown us how to be.
  Mr. President, I yield the remainder of my time. I urge an ``aye'' 
vote on this bill.
  Mr. BENNETT. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Sessions). The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. BENNETT. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BENNETT. Mr. President, I am prepared to yield back all time, 
both for myself and Senator Dodd, and call for the yeas and nays on the 
underlying question.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to S. Res. 7, as 
amended. The yeas and nays have been ordered. The clerk will call the 
roll.
  The bill clerk called the roll.
  Mr. NICKLES. I announce that the Senator from Arizona (Mr. McCain) is 
necessarily absent.
  Mr. REID. I announce that the Senator from West Virginia (Mr. Byrd) 
is absent attending a funeral of a family member.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
who desire to vote?
  The result was announced--yeas 92, nays 6, as follows:

                      [Rollcall Vote No. 29 Leg.]

                                YEAS--92

     Abraham
     Akaka
     Ashcroft
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Breaux
     Brownback
     Bryan
     Bunning
     Burns
     Campbell
     Chafee
     Cleland
     Cochran
     Collins
     Conrad
     Coverdell
     Craig
     Crapo
     Daschle
     DeWine
     Dodd
     Domenici
     Dorgan
     Durbin
     Edwards
     Enzi
     Feingold
     Feinstein
     Fitzgerald
     Frist
     Gorton
     Graham
     Grams
     Grassley
     Hagel
     Harkin
     Hatch
     Hollings
     Hutchinson
     Inhofe
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerrey
     Kerry
     Kohl
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lott
     Lugar
     Mack
     McConnell
     Mikulski
     Moynihan
     Murkowski
     Murray
     Nickles
     Reed
     Reid
     Robb
     Roberts
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Schumer
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stevens
     Thompson
     Thurmond
     Torricelli
     Voinovich
     Warner
     Wellstone
     Wyden

                                NAYS--6

     Allard
     Gramm
     Gregg
     Helms
     Hutchison
     Thomas

                             NOT VOTING--2

      Byrd
     McCain
       
  The resolution (S. Res. 7), as amended, was agreed to.

                               S. Res. 7

       Resolved, That section 5(a)(1) of Senate Resolution 208, 
     agreed to April 2, 1998 (105th Congress), as amended by 
     Senate Resolution 231, agreed to May 18, 1998, is amended 
     by--
       (1) striking ``$575,000'' the second place it appears and 
     inserting ``$875,000''; and
       (2) striking ``$200,000'' and inserting ``$500,000''.

  Mr. LOTT addressed the Chair.
  The PRESIDING OFFICER. The majority leader.
  Mr. LOTT. Mr. President, I would like to take just a moment to once 
again express my appreciation to the leaders on the subject matter just 
passed overwhelmingly. The Senator from Utah, Senator Bennett, and the 
Senator from Connecticut, Senator Dodd, have done outstanding work.
  I think they have served not only the Senate but the country well by 
highlighting the problems in this area with Y2K, but doing it in a way 
that does not cause undue alarm or panic. But it has been very helpful 
to Senators to hear what they have had to say, both in the closed 
session and also here on the floor this afternoon. I believe they have 
contributed mightily to the prospect of us dealing much more with the 
problems adherent in this area and getting some results before we face 
the turn of the century. So I commend them for their fine work.

                          ____________________