IT and the US Feds: Year 2000: Nudge, Don't Push

They don't want legislation or regulation. Still, those who think Washington should help corporate America solve its year 2000 problem say it can and should do more.

Some year 2000 experts and IS executives have wanted the Clinton administration to speak out and raise awareness of the issue. But it wasn't until a month ago that President Clinton urged business leaders to prepare for what he called a "cyberspace headache." He also pledged to share information with other countries.

The president's words were "good," says John T. Jung, senior vice president and chief information officer at California Casualty Management Co., an insurer in San Mateo, California. But he should have said them three years ago when most U.S. companies were just starting to confront the year 2000 problem, Jung says.

Indeed, the federal government has scored few points with the IT community, either with the year 2000 status of its own systems or in its apparent lack of leadership on the issue in general.

Howard A. Rubin, president of Rubin Systems Inc. in Pound Ridge, New York, has tried to get Washington's attention since 1995. In April, he polled 120 senior IT professionals and 100 business executives on how they feel about the government's role in the year 2000 problem.

Eighty-seven percent of the IT professionals and 72 percent of the executives said Washington should be doing something to address the problem, the findings revealed. But more than 90 percent of those who answered "yes" in each group said the feds aren't taking adequate measures. What they want, Rubin says, isn't more regulation, but for government to be a facilitator of information from industry.

That's fine with Gary Wilson, year 2000 project manager at The Principal Financial Group in Des Moines, Iowa. But "when it comes to legislative-type action," he says, the government "ought to keep their nose out of it."

Yet earlier this month, the Federal Deposit Insurance Corp. said it would "take increasingly stronger action" against banks it considers year 2000 laggards. The action could include the seizure of assets. And U.S. Senator Bob Bennett (R-Utah) urged the U.S. Securities and Exchange Commission to strengthen its requirement for publicly traded companies to report their progress.

The U.S. Congress, for its part, has held several hearings on the government's year 2000 readiness. It also has passed legislation giving regulatory agencies more power to push banks and other financial institutions toward compliance.

Part of Washington's apparent reluctance to do more may be out of fear of causing panic, especially in financial markets. John A. Koskinen, chairman of the President's Council on Year 2000 Conversion, said as much in testimony before a Senate committee on April 1.

"While it is important to increase worldwide attention," he said, "we need to avoid creating panic and precipitous, counterproductive activity."

Washington shouldn't launch into panic mode, Rubin adds. "This is a high-risk situation," he says. "But it may not be a crisis."

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