WASHINGTON -- The government pinned a staggering $100 billion price tag Wednesday on the nation's repair bills for the Year 2000 technology problem, or $365 for each man, woman and child.
For all that, the Commerce Department predicted the impact of Y2K computer failures on the economy would be merely "something like a tangled shoelace for a world-class marathon runner."
In a new report, the government said America's booming economy was sufficiently "stable, large and resilient" that failures -- even those overseas -- will not seriously affect the nation's $9 trillion gross domestic product.
"Any glitches that pop up next year should not hurt our economic growth," Commerce Secretary William Daley said. "I am not going to lose any sleep."
The $100 billion figure for total repairs from 1995 through 2001 was generally in line with other estimates but still is an enormous amount. Private analysts last month put the figure at $114 billion.
It roughly is the same as the total spent last year by seven of the largest federal agencies and just more than the personal fortune of Microsoft's chairman, Bill Gates.
Commerce Undersecretary Robert J. Shapiro said some Y2K precautions -- such as companies adjusting inventories to hedge against possible supply problems -- could affect the "pattern and timing" of economic growth.
Those rising expenditures, for example, could add to growth during the last three months of 1999 but likely would slow it during the first months of 2000 to compensate.
Shapiro also said consumers who decide to stockpile food, water or other supplies could drive up prices in the final six weeks of this year.
Another government report, being released Thursday, predicted only a slight risk of "serious or widespread disruptions" in the nation's food supply. Consumer hoarding and weather-related problems could cause spot shortages, but food companies have made "remarkable progress" in getting their computerized systems ready, the report said.
President Clinton's top Y2K expert, John Koskinen, also cautioned Wednesday that "several hundred thousand" smaller companies nationwide have not performed any repairs and apparently intend to fix problems after they occur.
Koskinen warned that business owners will find long waits for technical support and new equipment in the earliest weeks of the new year, and "some of them may lose their customers and go out of business."
"We are getting close to it being too late to start," said Koskinen, chairman of the President's Council on Year 2000 Conversion.
Daley's generally optimistic remarks mirror statements made during past months by top U.S. financial leaders. Federal Reserve Chairman Alan Greenspan, for example, has warned that stockpiling and inventory hedging against possible failures could cause more trouble than the Y2K glitch itself.
The new report said spending on Y2K repairs climbed from $5 billion in 1995 and peaked last year and this year at about $30 billion each. It was predicted to drop next year to about $5 billion.
The federal government has said previously it will spend $8.4 billion on Y2K repairs.
"The greatest cost to our economy is behind us," said Daley. He acknowledged that $100 billion was "absolutely" a lot of money, but added that "the potential cost of not doing anything was far greater."
© 2018. All Rights Reserved. | Contact Us