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Gary North's Y2K Links and Forums

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Category: Power_Grid Date: 1999-12-31 18:49:02 Subject: The Y2K Weatherman Says I'm Wrong, Based on Electrical Power in the Rollover Comment: Do my critics actually read what I have written? This man hasn't. He is Y2K Weatherman. He sent out this letter today:

The public utilities appear to have survived just find fine. This is wonderful news. If electrical power is not impacted then we can breathe a sigh of relief and know for sure that Gary North was indeed wrong. The worst case scenario has been avoided, and right now it looks like the Y2k optimists will be the ones saying "I told you so" in the coming months.

I'm always happy to know that something is just find fine. In this context, it is indeed wonderful news. It just isn't complete news.

With respect to me and my views on this topic, go to the Power Grid category page. I have not touched this page, as far as I remember, in at least a year. I rarely add anything to my category pages, other than an occasional link.

Actually, I should have revised the page. I wrote that there was not one compliant plant. At the time, that statement was correct. Subsequebntly, I added links to articles and SEC reports that identified a few power plants that had announced compliance.

What I have most worried about in relation to electrical power have been these isues: the banking system, the supply of spare parts, and the railroad system's ability to deliver coal. These issues are not settled yet.

With respect to an overnight failure of the grid, I wrote:

Again, I am not predicting this. What I am predicting is that the fractional reserve banking system is at risk, and that government controls on banking will not help to repair that endangered system. I fear erosion: the wearing out of all complex systems and the inability of engineers to get replacement parts because of a failure in the means of payment and a contracting division of labor. If railway freight is compromised at the same time, the likelihood of power failures rises.

If the banks stay up, and the trains keep rolling, and the industry's suppliers remain both solvent and compliant, then my fears will be shown to have been unjustified. But this scenario will take more time to unfold.

Count your dead chickens after they have died. Please, Mr. Weatherman, read more carefully.

* * * * * * * * *

. . . The typical large city power plant has something in the range of 5,000 suppliers of goods and services. How will they be paid if the banks go down? Also, how will users pay the power companies? This problem must be dealt with now, not in 2000 and beyond.

The grid may not go down overnight. (Then again, it may.) The problem is erosion: the second law of thermodynamics. Things wear out. How do they supply the plants with replacement parts if the banking system is in a crisis? This is the problem of the division of labor. A banking failure threatens the grid. The failure of the grid threatens everything.

If your local power plant somehow solves these problems, what happens if others don't solve them? What if an overloaded grid shuts down? It could take down your local system. This is the coordination problem: among the local generation stations, among the regional grids, and among the suppliers. . . .

It's not good enough to get a local system y2k-compliant. Most of the power systems of the nation must be compliant or they all go down, region by region, in one gigantic rolling blackout. If New York City goes down, Hog Jowls, Alabama probably will, too.

Then so does every computer in the country, compliant or not. And if they all go down, nobody will be able to repair any of them. There is no tomorrow if the national power grid goes down on Jan. 1, 2000.

Again, I am not predicting this. What I am predicting is that the fractional reserve banking system is at risk, and that government controls on banking will not help to repair that endangered system. I fear erosion: the wearing out of all complex systems and the inability of engineers to get replacement parts because of a failure in the means of payment and a contracting division of labor. If railway freight is compromised at the same time, the likelihood of power failures rises.

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