The whole argument started when Stephen Hawking attempted to describe what happens to matter during its lifetime in a black hole. He suggested that, from the perspective of quantum mechanics, the information about the quantum state of a particle that enters a black hole goes with it. This isn't a problem until the black hole starts to boil away through what's now called Hawking radiation, which creates a separate particle outside the event horizon while destroying one inside. This process ensures that the matter that escapes the black hole has no connection to the quantum state of the material that had gotten sucked in. As a result, information is destroyed. And that causes a problem, as the panel described.
As far as quantum mechanics is concerned, information about states is never destroyed. This isn't just an observation; according to panelist Leonard Susskind, destroying information creates paradoxes that, although apparently minor, will gradually propagate and eventually cause inconsistencies in just about everything we think we understand. As panelist Leonard Susskind put it, "all we know about physics would fall apart if information is lost."
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't Hooft described how the disagreement eventually got worked out. It's possible, he said, to figure out how much information has gotten drawn in to the black hole. Once you do that, you can see that the total amount can be related to the surface area of the event horizon, which suggested where the information could be stored. But since the event horizon is a two-dimensional surface, the information couldn't be stored in regular matter; instead, the event horizon forms a hologram that holds the information as matter passes through it. When that matter passes back out as Hawking radiation, the information is restored.
Susskind described just how counterintuitive this is. The holograms we're familiar with store an interference pattern that only becomes information we can interpret once light passes through them. On a micro-scale, related bits of information may be scattered far apart, and it's impossible to figure out what bit encodes what. And, when it comes to the event horizon, the bits are vanishingly small, on the level of the Planck scale (1.6 x 10-35 meters). These bits are so small, as 't Hooft noted, that you can store a staggering amount of information in a reasonable amount of space—enough to describe all the information that's been sucked into a black hole.
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