Comment Articles

Learning from the bankers

David Berlind ZDNet.com

Published: 29 Sep 2003 15:25 BST

"It's kind of ironic," the State of Georgia's commissioner of banking and finance David Sorrell told me. "We put all of these contingency plans in place in the event of a Y2K disaster, and then nothing happened. But if it hadn't been for all that Y2K preparation, most banks wouldn't have been nearly as prepared for 9/11. The investment paid off after all."

Sorrell's experience with disaster planning for the banking and finance system could provide some lessons for just about any business -- even if it's not integral to national security in the way banks are.

How critical to national security is America's banking and finance system? "The worst place to be is between someone and their money," noted Sorrell. "Once word gets around that people can't get their money out of banks, the national security situation can start to unravel. Not only are there are a lot of people who can't get to their jobs if they can't get to their money, there are a lot of people who can't do their jobs if they're panicked about their money."

"For example," said Sorrell, "what if the people who are supposed to be making sure that all the corporate systems are working during an emergency aren't doing their jobs? That could disrupt all of the other systems that depend on those corporate systems to work, and then you get a domino effect."

Today, the US dollar -- with neither gold nor silver backing it -- depends solely on public confidence and the US government's ability to satisfy its creditors. "The banking and finance system is so ingrained into our country and our culture that it needs to be a priority in times of an emergency," Sorrell says.

A key component of that priority status is what Sorrell calls the system's "telephonic preference" on the nation's telecommunications infrastructure. Sorrell and his counterparts in 49 other states and four territories, as well as those at federal agencies like the Federal Reserve and the FDIC, will never get that "all circuits are busy" message when attempting to complete a phone call during a national emergency .