The Deeper Dive: Largest Global Computer Crash in History Reveals the Fragility of Efficiency

The stock market continued its dump on Friday, and the two-year Treasury yield saw its largest rise in nearly two months. All indices participated in the continuing slump, which has become more than just a rollover from high-tech growth stocks to more solid value stocks. It probably didn’t help Tech any, though—at least didn’t help one company—that the internet experienced its largest shutdown ever.

Computer cyber security (insecurity?) behemoth CrowdStrike immediately took the blame upon itself and clarified that the global shutdown was not a hack or governmental cyber attack—something that would have been much more frightening—but a mere glitch in an upgrade. For many, it was the glitch that shutdown their workaday world. CrowdStrike shares landed down 11% on Friday.

That single glitch shut down thousands of flights, trains, supermarkets, cafes, factories (such as Tesla), hospitals, doctor’s clinics, financial companies, Amazon warehouses, and government offices … to name only a few. Even my wife couldn’t work on Friday as a city employee from home because the only thing her computer at home would show all day long was the “blue screen of death.”

Some said the event was equal to what was feared for Y2K in terms of the scope of the shutdown (but probably much more recoverable in terms of the quickness of the fix, given that a software upgrade to the upgrade was issued on the same day). Elon Musk called it the biggest IT failure in history.

The importance of the event that I want to bring out in this Deeper Dive is how it reveals the fragility of our highly integrated technological world. The fragility is made worse by the fact that in so many areas just a few mega-corps dominate, meaning a failure by a single corporation can take out large swaths of technology.

That, at least, is what we just experienced. It was the IT equivalent of a major asteroid impact on the earth in terms of the immediate impact and spread of the shutdown, though probably not in terms of lasting damage. That, however, remains to be seen. The fix is already in; so, presumably, most companies and individuals will just return to up-and-running. Most probably already have.

What is immeasurable is how much business may have been lost during this techno lockdown/lockout glitch of the internet and internal business computers (as my wife was not even trying to connect to work via the internet; her personal computer at home locked up before she even accessed the city’s system, probably because of cyberware the city had parked on it to make it integrate more like a monitor station with her computer at work, which does all the actual computing).

Who knows what lasting damage will come in the form of lawsuits for years on end as businesses tangle with businesses or with customers over services that were not performed, particularly as businesses strike back at CrowdStride, but also as patients somewhere did not get immediate medical attention because of all the troubles hospitals experienced, and somewhere maybe some patients even died as they fell between the techno cracks that instantly spread through the healthcare system.

Even CrowdStrike CEO George Kurtz admitted that nefarious actors are likely to seize the opportunity to step in with apparent solutions for those who are waiting on CrowdStrike to offer quick fixes, but their help will actually be intended to corrupt systems. He asked customers to be certain they are working CrowdStrike for their safety.

So, the limits or the direct damage to business and contingent damage by bad actors seizing the opportunity of centralized weakness and desperation are not known, and the extent of lawsuits over damages are even further from being known.

Cracks in the Globe

The point here is that—just as we saw with the globalization of trade when the Covid lockdowns hit major supply chains—efficiency can bring weakness. When we rely on here-and-now delivery for efficiency, our reliance can also become an efficient cause of global trouble when these global systems break.

Many, including Elon Musk, referred on Friday to supply-chain problems like those that developed first out of the Trump Trade wars and then grew under the concurrent lockdowns that occurred in Trump’s final year. Some called all of that the end of globalism as we had known it. I think that was an overstatement, but it certainly drove some deep cracks into globalization, as have all the wars that are currently going on during the Biden administration with all their sanctions.

Musk wrote that the outages had caused a “seizure” to the automotive supply chain, adding, “We just deleted CrowdStrike from all our systems, so no rollouts at all.”

Tesla closed its factory in Texas for the day and sent employees home.

Globalism is cracking, and Friday delivered a new and broad set of cracks throughout the global internet, effecting business systems even off the internet.

FTC Chair Lina Khan weighed in on the ongoing CrowdStrike outage in a series of posts on X on Friday. Without mentioning CrowdStrike or Microsoft, she appeared to blame the outage on concentrated market power, which creates “fragile systems,” she wrote.

“Concentrating production can concentrate risk, so that a single natural disaster or disruption has cascading effects,” Khan wrote in the series of posts. (CNBC)

(CrowdStrike’s CEO gives a video interview with CNBC’s Crazy Cramer on the situation within the article linked to above that is worth listening to if you have questions about what happened. The article, itself, also provides broad coverage on the impact of the incident.)

Our desire to rely on the efficiency of computerized systems and the internet and now computerized intelligence all creates centralized weaknesses that go along with the centralized strength. Imagine, as Elon Musk goes much further with his borgification of the human species—his cyborg integration with the human being to give us “super powers—imagine the global human shutdown if there’s a glitch within the newly centralized human brain—a Y2K bug in your head that affects every wired individual simultaneously.

Elon believes we will soon have a world full of wired individuals, so this isn’t necessarily any further from reality than self-driving cars (or any more free of glitches and crashes).

I don’t doubt that many people will crave the higher powers, creating a new kind of technohuman, not that far down the road from now. This will be a new kind of problem for those hybrid, high-wired people, too, and for all of us who rely on them. Adoption will be more than a matter of some people craving the intensified efficiency that allows those raised in a computerized world to integrate with their own devices and games, as I described in a recent article, or with the vast stores of knowledge AI can access and give to them. Having a wired brain may become an essential attribute for getting a job at some companies, given how Musk’s first rollout of those brain-integrated computer interfaces already operate with greater efficiency than the human brain-hand-keyboard connection, even the one that half unwired itself. Musk is intensely serious about this and is moving much faster than many thought possible or advisable. (See my article “Musk the Martian Man Seeks to Integrate AI into the Human Brain.”)

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