Hello, I'm Carleen McKay. I'm an expert in the emerging workforce. Now you might look at me and see somebody about 80 years old and wonder about that. We'll talk a little bit about working later in life here in a few minutes. I'm thrilled to be with you. New Workforce Hawaii is a membership. It's not an organization. It's not a nonprofit. It's an exclusive membership of people who specialize in emerging workforce challenges and issues. I'm really thrilled that my guests here today are part of that team and each brings their own unique gift. But before we get there, I'd like to talk more about the why we should be promoting this program and, most importantly, why you should be looking at it. When I think about the changes in the workplace, I think technology. I think data analytics. What really, really pushes me is thinking about longevity. And let me give you an example of why that's so important. When I was young and no dark hundred, you went to work. You worked for 20, 30 years, and that was the end of it. But you also didn't live very long compared to how we're living today. So let me take you back on that history just for a minute or two. In 1935, when Social Security was enacted, average life expectancy was 61. 65 was the maximum benefit. Everybody, and my friends, took it at 62 because they knew they weren't going to be around that long. Today, average life expectancy in Hawaii is 80 years and growing. Just wait for the next generation and you'll see that it will be easily 90 average. If you live to 65, that changes because average life expectancy is determined at birth. Half the people live lower than 80 years, half live longer. But what's happening as you age, you get to 65 healthy and every likelihood you're going to live to 85 or 90. Now tell me something. If you retire at 50, hello, Bill. If you retire at 50, it's a long time. And we don't have the wherewithal financially. Average savings of 50-year-olds in Hawaii is somewhere around $25,000. Please tell me how you're going to last another 30 years. And somebody said to me when I mentioned that to them, they said, well, we'll just live with their families as we always do, Ohana. And I said, I don't think my family would want me for 30 years. They might like me around some of the time, but I want to be independent too. And the reason I'm working at this age is that independence. How about you? Why does it matter to you to be able to stay connected? Tell you two or three reasons. One, the most likely time to get laid off and lose your so-called traditional job is in your early 50s. Two, the most difficult time to get re-engaged is in your middle 50s. You're either too old, overqualified, overpaid, but however you want to look at it, it's not even sensible any longer. And yet we have people constantly coming to us and saying, get me another job like the one I just left. And here's the problem. That job, like the one you just left, no longer exists, at least not as it did at one time when you were in it. So why are you here today? If you're in your mid-career or your late-career, you need to figure out how to work longer. It needn't be full-time. It can be part-time, some of the time, for the common good, for passions that have stayed dormant all the years that you were working for someone else. And I have one little tiny story. Then we go to our guests and enjoy our time with them. I had a fellow I met who laid tile for a living. And I took his story, and I have it in one of my books. He was 58 years old, and he said, my knees are starting to hurt. And I said, are you waiting for them to get better, or just what? And he said, I just don't know what else to do. And that's the problem. I really don't. If you've spent 25 or 30 years doing one thing, the rest of the world is unfathomable to you. You see it all the time with people. You see it in our hotels here in Hawaii. Absolutely.  And here's the bottom line. And then go to the guests. One in four Hawaiians will be 60 by 2020. That's the day after tomorrow, you know. It's not some long time away. One in four. If we don't work, you can't afford us. And we'll tell you more about that in a few minutes. But first, let me introduce you to my first guest, Phyllis Horner. Phyllis says, I can finish my sentences. We actually do that because we both had very similar experience in working with people at all levels in the organization in terms of making sure they remain sustainable in one way or the other, which can mean just like the sun I saw when I came in here, lifelong learning lives here. Exactly. That's part of it. So Phyllis, I have a series of questions that I'd like to ask you. Sure. And then Bill Sager will pop in because I have a really important question to ask him. So ask yourselves, you who are watching, are you ready for your longer future? It's a big question, isn't it? A few of us, a few of us, a few of us ever asked that question. So Phyllis, let me, I wrote a few of these down because I called a few people to find out what their questions were. And I thought it was kind of interesting. I'm going to save one for you because it fits you even better. Do you mind if I put my glasses on and read everybody? This is one of the questions I received. What is the single biggest barrier you have observed in mid to late professionals? This is your bailiwick. This is where you work. So give us a little flavor of that and then give us the answer, please. Well, you know, that's a great question. I actually think that most of us, we thought of our careers like hiking up to the top of Diamond Head and we would strive and strive and go through everything that we needed to do to get there. And then we get there and when we're before like 50 or 52 years old, we think, great, I'm going to go down, I'm going to come right back up again. And at some point you go up to that hill and you say, oh my God, look at all these younger people behind me. They're going faster and they're stronger and the fear sets in that when you go back down that hill, you don't know what is going to happen. So the biggest barrier is not knowing who you are if you're not doing the same thing you always did, feeling vulnerable about that. And then the rest all depends on your personality. Well, it strikes me as a good time for a question for Bill. Were you ever that way vulnerable and feeling you couldn't go ahead or have you just been creating magic? Yes. Everything kind of came together when I was 55. I had a state job and my personal purpose and reason for being did not sync with that job. So I wasn't too happy where I was working. A friend was terminally ill and needed help to run his business and I was in an age where I could retire. So I helped him run his business for a year and I came to work one day and they sold the business and the new owner said goodbye. And I walked out the office with my stuff two hours later. Now that's a major impact on your psyche, whatever you call it, but what am I going to do now? And so I drove around trying to figure that out and it was real strange. I'm a forester and I worked for a forester on Maui who was a tanker's older guy that was difficult to work with and I hit it off with him wonderfully. And he came to me while I was driving and said it's going to be all right. That was what you needed. That just focused in my head. So let me just add to that if I may.  It's good job now get out. So this is like you did something wrong. Those days are gone. Now it's don't need you. So I had some computer background and I went into computer consulting. I had a gig with the state helping run a program for kids that had the choice of going to jail or working with me on conservation projects. I worked for a year and a half as a salesperson for a paint contractor. It was strictly a gig. It was a gig like the gig economy today where people do some of this and some of that. I did a lot of work setting up networks and helping people use their computers and teaching them how to use software. And about the time I turned 70 I found that people were a little less anxious to hire me and I realized that computers were becoming commodities and that I was going to have to look for a shift and the internet was coming on strong and I looked at the opportunity to use the internet to build a residual recurring income. So let me interrupt you because I'm going to want more from you but I do want our listeners to understand something. You can learn computers and technology, internet at any age. Absolutely. There is no barrier. Here's your living example. We've got a wonderful, wonderful team member in our membership. I'm 86 shooting for 100. You're 86? See, I never really was sure of your age but somebody told me that I looked older than you. No, that's not true. We didn't say that. Oh, didn't we say that? But I think that's a point. But I want to make another point here because before I forget it Bill came out of the public sector and came out with a pension. Do you know, do you realize that the pensions in Hawaii are underfunded by billions? I think the number was 14 billion last I looked.  There's no way it can be sustained if everybody's retiring at 50 and living. And one of the important things is the state is paying my health insurance and if I didn't have health insurance I'd be bankrupt four times over. Well, and so there's another dilemma that we all face and I can tell you that at some point when you get to Medicare and Social Security there are ways to do it but none of it's what you really look forward to. It's what you have to do. By the way, speaking of Social Security before I forget you know maximum benefit now is 67, not 65. So those of you who are younger watching this or listening to it, be prepared for it to be extended again because it will. I'm going to come back to you in a minute but I want to get another question or two into Phyllis because I have another question or two for her. Shall we take a break first? Just for a minute or two? Works for me. I'm Carol Mon Lee and I want to welcome you to our newest series called Education Matters where we will explore education-related topics that touch everyone, not just formal programs in K-12 and higher education but also broader issues and information that affect our community. Aloha. My name is Richard Emery and I host Condo Insider. We talk about issues facing the Condo Association throughout Hawaii and talk about solutions. When you think about it, about one-third of our population lives in some form of common interest real estate. We broadcast every Thursday at 3 p.m. Please tune in. Tune in and thank you. Aloha. Hi. I'm Cheryl Crozier Garcia, the host of Working Together on Think Tech Hawaii. Join us every other Tuesday from 4 p.m. to 4 30 when we discuss the impact of change on employees, employers, and the economy. Are we ready? Hello again. I'm Carleen McKay with New Workforce Hawaii, an exclusive membership of professionals who are dedicated to mid and late stage careers and other career stages as well but for today that's our subject. Our motivation is to get you to think about working later in life because you're going to live longer because it's fun and it gives you something to do with your day that matters. I think very much so. Our guests today are Bill Sager to my immediate side. Bill is our 86-year-old technologist. Watch out, kids. And then we've got Phyllis Horner and Phyllis is absolutely the past, present, and future guru of mid and late stage careers. So I have some more questions and we're starting to run a little bit closer. So let's ask away. Ah, this is a good question that somebody gave me with the facts telling us that we are living longer and worry about living our money because we do. Why don't more people take time to plan for continuing to work? That is the question. That is the question. And I think really, especially here in Hawaii, many of us, we are happy in our jobs. We really find a lot of positive things with our HANA, our way of life, et cetera, and to ask too much to always be ambitious is kind of the first problem. So because we stay in those jobs so long, we kind of create a problem for ourselves later on. We end up outliving our usefulness if we're not careful. We have to do preventative maintenance while we're in a job in order to be comfortable when it's time to leave it. And, you know, why do people not plan? Did you know that more people plan their vacation? They spend more time planning their annual vacation than they do their retirement? I mean, none of us really want to think about that. We have this image in our mind about what retirement was, right? What retirement used to be. Do you remember it was round, endless rounds of golf and all that kind of thing?  And it doesn't exist. So we're kind of, we're staring out at this vacuum. We don't want to have to work forever and we don't want to have to plan to work. But in fact, you know, what I'm finding with people that I work with is once they get through that piece of, you know, I have to think different about this. I shouldn't be afraid. I should just plan it like I plan anything else. Then the rest is easy. You can have many, many gigs in a row the way that Bill did. It's just a matter of getting yourself past that hump of, why can't I have what my parents had, you know? Well, that's over. And it's over for so many reasons.  But there are other things, and especially here that I've been paying attention to because of my personal situation, I was widowed at 65 and that's the typical picture is women are left behind in their middle 60s. It's a long time to sit on a porch even if you have one, it really is. Do you have any particular ideas as to how to help people overcome the resistance to change? Do you work with people in that? Yes, I do. That's a really good question, Karleen, because I think even I have resistance to change. I'm not immune from any of this myself. Maybe Bill is, but I'm not. To get people past resistance to change, they have to see that the future can be exciting again. And so I have a term I call get more mileage from your late career, meaning, prosperity and growth. That's MPG. And how do you start that back up? You have to look backwards to see what you really did like and what you were good at and what people thought you were naturally good at. And then Karleen, I've learned so much from you about that is not enough. You have to match it to where the marketplace is going, right? Amen, that's the truth. And then once you get that, it's like skiing downhill instead of falling down that hill. That's exhilarating again. It is exhilarating. And that's another thing. We continue to work typically first reason is money. But the second and equally important reasons are the loneliness and despair that people fall into when they're alone a long time. That's true. That's so true. Been there and done that. And I can remember I was retired for three weeks once. And people said, I love this, I love this. At the end of three weeks the vacation was over and I went, okay, now what? And I think people that are listening today are thinking the same way. That it all sounds good but it isn't. The number one step in our process of helping people is the letting go process. And for mid and late career folks, that's probably the most demanding is to get them through that period of letting go of the past and moving forward. How about you, Bill? Did you have any trouble letting go once the guy stopped you and said, don't worry, be happy? Well, I always wanted, I am a kind of conservationist. That's where I was. And for ten years I was really lost because I was finding all these gigs that had nothing to do with conservation. And so I had to sit down and look at what my purpose was. What I really wanted to accomplish and then say how am I going to get there? And that's why I built myself as a transition specialist. I helped people get from where they are to where they want to be. And most people, like you say, are drifting. For a long while. They are drifting. They don't know what their purpose is. They don't know what they want to accomplish. And unless you understand, unless you understand what your purpose on this earth is, you're lost. Yes, that's right. And you don't know where to go. So, first thing, decide and understand why you're here. And then as long as you live, work to accomplish your goals. That's so important. And when we were talking about the link with the marketplace, one of the unique features of New Workforce Hawaii is to get people to see that their career is their business. Not their job. And when you're running a business, you have to adjust. You have to make a little tweak here. And we have a perfect example of that in our relationships. Everybody has a unique gift for the membership. When you are listening to us and looking at us, and you say, I can't think of any, that's why you need people like us to help release that so that you can, in fact, find the purpose that the market wants. Right. And I would just add that our purpose changes over time. And having more than one is okay. Just pick the one you want to do for the next five years and then... I have multiple things that are important to me. How many? I look like a cat with nine lives. Right? Yeah. I still do a lot of work in the conservation community and most of it is as a volunteer. And that's an option for someone who is retired and has an adequate income. Well, and it's a great option and one of the things that we promote right? I can give you, without exaggeration, two dozen other ways to work that matter to our market. In fact, we have a book coming out that will be online mid-April free. So pay attention to newworkforcehawaii.com Look us up on the internet. If you don't know how to do that, find somebody to help you to learn how to do that. I'm Bill the Sage, not Bill Sager, but my point is if you need help, reach out for it. If you need help to make major shifts for absolutely positive reach out for it. If you're just simply saying I want a job like the last one I had, I can name ten people right here, right now in Hawaii that spent a whole year looking for what was gone. And that just breaks my heart. It's a tremendous waste of time. It's illusionary. It's a delusionary. And I think it's time to say come on, let's at least get exploring and looking together. And we'd be happy to help you in that regard. Phyllis, if you were to bring up something that you think is the critical point you'd like to make today, what would that be? Well, you know, for me it's really if you're drifting right now and you're annoyed, if it's boring or stale or you're getting feedback that isn't as great as it used to be. You know, you really need to just zoom ahead and start planning right now. Don't wait until something happens, right? Don't wait until something happens. Have a plan B right now. That would be what I would say. And there are a lot more resources and a lot more ways to work like Carlina is saying. Pay attention to what comes next. Well, we'll be talking about this on our regular shows. We'll be talking about all generations. You all have challenges that are different from other generations, but the serious one right now for Hawaii, most serious one, is to make sure that we can sustain our working lifetimes. And so when we look at mid-career, that's the vulnerable moment. That's when you should start looking at what's next, even if you're happy. Times change. And with the changes in technology and all the other things that we're facing, changes in our family lives, you name it, there is something else ahead of you. And if you can get to our stage of life and be more excited about what you're doing than at any time in the past, why wouldn't you? I just don't get the fact that people think somehow sitting on the beach in Hawaii doesn't get tiresome, it's the most beautiful beach in the world because it is that. Any other comments, Bill, you'd like to make? Develop a side hustle so that you have something to fall back on when your job situation changes. Good one. If you were to give one last piece of advice to people watching this, what would it be? One more piece of advice. We're getting very close to the end here. Know what your purpose is. Set your goals and work for them a little bit every day. And the other piece of advice that I would give you and mean it, don't take this information lightly. We're also concerned with so many things. But if you think about having a fulfilled life, it involves some form of work. One of my favorite things to do is to look at what I can do for a fee, for free, and for the good of the community. And I call that a work portfolio, which means there's something in it for everyone with whom you interact. How about you, Phillip, favorite way to work? I agree. Portfolio is the way to go. I like to learn from millennials a lot. I feel like the way they have passion and they go to work for something beyond themselves, they don't really stick around for 20 or 30 years just to have security. And I think you guys should consider that too. And I want to just conclude by saying Phillip spills herself as the oldest living millennial. But I'm the oldest living millennial. Thank you very much for being with us today. Come back. We'll be here with you every few weeks to make certain that your career is being looked after.


Hello viewers, how are you doing? We are live but I don't, we're gonna take it off and then do it again. Okay.


June Jordan said we're the ones we've been waiting for. Titus Burgess put it to music. Paul said, all of creation is waiting like a woman in childbirth for the revealing of the children of God. Children of God, we've got to show ourselves. Stand up, stand out, stand in, die in. March, tweet, protest, change the story. All of creation is waiting on us to dismantle racism.


Welcome to film my run on this beautiful evening. It is a lot calmer than it was when I was here this time last year. We're on a hill fort and we are overlooking the town of St Peter's Port in Guernsey for the gun 31. 31 miles, that's not actually quite 31 miles but 31 miles ish all the way along the coastal cliff section of the Guernsey coast all the way to the end, 16 miles and then all the way back, 16 miles ish, 15, 16, 14, something like that. Starting at midnight the idea is to get back here by 7.30 in the morning or sunrise time, cut off I think is 7.30 in the morning. So let's have fun and enjoy it. Don't be scared. Right this is Tom who won this race last year Tom. What's going on? I've got no one here again to blatantly honest, I'm actually in bed by now. No it's good, much nicer than last year. Are you looking at a time? Hopefully five and a half. Well the cuts off seven and a half hours and I did seven hours 36 minutes. So you've got a score to settle haven't you? How's your name? Tom Chamberlain. Right Tom. I was the only person that didn't finish the course last week. Half kilometers into five miles, one hour 13 minutes. Basically the entire cliff coastline of Guernsey is littered with these steps. Make sure we go the right way, there's these red markers here to tell us that's wrong and the white markers here tell us we're going the right way. So the first place runner has gone by, second place is coming through now. Well done buddy, he really isn't far ahead. He's dropping me out, he's cracking us. Good job. Well done buddy, what's your name? Graham. Well done Graham, good job. Fourth place. Living the dream dude. Living the dream. Right so this is the halfway aid station, 24 ish kilometers, 23 in a bit something. So the car here is 330, 3 and a half hours? Yeah. Car here is 3 and a half hours and I've just made it the eight minutes to square. Hello mate. Good job. Hello Tom. Still climbing steps. Four hours, 10 minutes, 29 kilometers. So just over 10 miles left to go. This is the difficult section now. Lots of hillage to climb, 500 meters left to climb but getting there, so 11 kilometers to go. 6 and a half miles, 7 miles. I'm going to get in under 7 hours but I don't think I'm going to manage it. But I've also got a guide about 200 meters behind me chasing me down. 4 kilometers to go. I've not made it in 7 hours but I've held off the guy behind me. I should finish in about 7.08. Just coming up now. Hard work that but a better time than last year and here we go. Here he comes. Here's our final runner coming at the end of gun 31. Well done Tom. Well done. I must have thought about quitting about 100 times. That's what an ultra is all about. That's what they thought. Yeah my children said don't come home until I'm finished. Well there you go then. So there we are. I managed to finish in 7.08 so quicker than last year. This time last year I was just coming into the finish just before 7.30 which is the cut-off time and I managed to catch the sun just peeping over the horizon. What a great end to a fantastic run. All in the dark. 29 miles even though it's called the gun 31. It's about 29 miles from here at the fort all the way out over the cliffs and back again and it's a great run. Come and do it next year. It's tough. The cutoffs are hard but if you train you can do it. I know you can. And that's it. That's it from Guernsey. We'll probably see you next year for the Guernsey 36. Until then take care. Thanks for watching. See you again for another marathon, another ultra, another crazy adventure next time. Bye bye. So Peter how's it gone today? It's gone well. Yeah for some people it's not gone so well. Well he is a it's a tight cut-off that isn't it? It is a very tight cut-off. It's a tough race. It's supposed to be a tough race. So you so that is deliberate then? It is deliberate. So who should come and do this race? Anybody who wants to challenge really, anyone who thinks they can do it, I mean there's a there's a kind of dual cutoff if you like. So if you get in seven and a half hours you get a medal and a t-shirt. If you get in about nine hours then you get a t-shirt but no medal. But it's also good for people who maybe are trained for other races or they're looking to step up to a longer race that extends into the darkness and they haven't done a lot of running, trail running in the dark. It's a safe race for doing that. There's lots of race support. You're never really far from civilisation even though you actually feel like you are as you know. So it's good for that as well. Is it easy for people living in the UK? Is it easy to get to Guernsey? Yes it's there's lots of flights and not so many boats at this time of year. It's not so easy as in May when the G36 is on. But yeah there's a lot of plenty of options of flights. Some people choose to come stay overnight, the night before. Some people come in on the Saturday and go on the Sunday. Yeah I mean I flew in at four o'clock yesterday sat in a cafe and then raced at 12 and I'm flying back today so I haven't even needed a hotel. Yeah so it makes it fairly cheap as well. Yeah but it's good. You don't get the full beauty of the online G36 because it's dark but you do get this sense of isolation. So it's a particular kind of race isn't it? You need a challenge. You're looking to step up. You want to do some night running. You've maybe got another race coming up that has night running in it and you need to practice or you need to practice on the cliffs or you just want to do something completely different for the adventure of it? Yeah absolutely and I mean I can't stress the safety as well. You get the feeling of isolation but you're never actually really far from civilization and we have motorized sweepers to go around. The extremely safe environment. If you might be nervous at night running in other locations you don't need to be nervous in Guernsey it's perfectly safe. So if you've never been to Guernsey before why not and maybe you're new talk to running why not come and do G36 if you love it which you will come and do gun 31 and have a real challenge. Thanks Peter. Thank you. Right I'm going to go and sit in a cafe for hours.


This lecture is on the minimum wage. I know it sounds like a simple straightforward type of issue, maybe not as consequential in terms of the overall economy. But it is a good way to illustrate the Austrian approach to economic analysis versus our mainstream friends and how they approach economic analysis. And also the minimum wage is indicative of the amount of government intervention in labor markets more generally. So if you see a political unit with a high minimum wage, chances are it's also going to have a lot of other similar types of government interventions. This is also related to a certain extent to other hot topics in the media these days. In addition to the minimum wage, of course, there's equal work for equal pay, the living wage, all these things are in the news on a fairly regular basis these days and increasingly on government ballots. So the main thing, some of the main topics that we're going to look at here is the fact that the minimum wage law is a classic example of economic analysis of government intervention. As I said, it's related to other issues, issues for which there's a great amount of confusion between various political ideologies on the left and on the right. This is a very ideologically driven issue. As I said, it's not all that consequential, but there's a lot of people that have strong views on both sides of the issue, and just as a disclaimer to this whole lecture, I just wanted you all to know that I actually do hate the poor. And as a result of mainstream analysis of this issue, there's a lot of confusion. It seems like one study will come out and exonerate the minimum wage, say that it doesn't have a negative effect, and then other studies which actually do come out and say it does cause unemployment, it does hurt various groups. And so there's a lot of confusion about this issue, and Austrian economic analysis brings a lot of clarity to this issue. And so the Austrian approach to this is a little unique. We don't necessarily expect an immediate increase in unemployment across the economy, for example. As a result of a new minimum wage or a higher minimum wage, there's a lot of other factors in the Ceteris-Perovis condition where we hold all things equal in order to be able to make that statement. So for example, if I said that the city of Atlanta has just voted, or voted at one time, to increase the minimum wage from the federal level of $7.25 to $10 an hour, starting at the end of June 1996. Well, you would think that's a pretty big increase. Atlanta is a relatively low wage city, so we might expect a great deal of unemployment as the figures start to come out. But at the end of June of 1996, of course, the summer Olympics began in Atlanta, so that would completely obliterate the fact that we could hold supply and demand for low-skilled labor constant. There would be a big increase in the demand for low-skilled workers in July of 1996 in the city of Atlanta, so we can't make any perfect predictions about these things because of other factors that we want to consider. And in addition to that, changes in the real world, Austrians take a very holistic examination of labor markets in all of the factors that might impact employment and the well-being of the employees that are being affected. So before we get to that, basically, minimum wage law is a floor on payments to labor. In other words, people are not allowed to contract between employee and employer below a certain level. So you can pay higher than the minimum, obviously, but not lower. Currently, the federal minimum wage law in the United States is $7.25 an hour. That goes across the country, you can't pay less than that. 31 states have higher minimum wage laws. In some cases, it's only like $7.30 an hour. In other cases, state law can bring it up close to $10 for the minimum. And then, of course, most notably, cities around the country have enacted higher minimum wages in their cities than their state or federal law would permit. And of course, we'll concentrate a little bit here on the city of Seattle because it's in the news on a regular basis. An article was just posted on Mises.org about the situation in Seattle. But other places have done it as well. So 31 states have higher minimum wage laws. 14 states are equal to the federal minimum wage law. And five states have no minimum wage law. And so you find those states without any minimum wage. You still have to pay $7.25 an hour. But they never had reason to pass a minimum wage law because they know that it would hurt their businesses and their workers. And so states in the poor south, which includes Alabama, don't have a minimum wage. So it's the realization of the negative impact that the minimum wage could bring about. Now, conventional economic analysis, the types of studies that you read about in the media are based on a simple supply and demand framework. And so you have the wage law here setting the minimum so that wages can't go below that level, where the market wage would be down here. And so as a result of this higher wage, the demand for labor, employer's demand for labor is reduced and the supply of people wanting jobs increases. That's very important to determine who exactly is being unemployed in this market. Now, this looks, first of all, it makes it look like it's a drastic effect on the labor market. But this is only the market for low-skilled labor. It's a very small segment of the labor force, about 2% of the overall labor market is this low-skilled labor market. And so your expectations of the amount of unemployment that you would get, this graph kind of exaggerates. And it's also important to note that over time, even though you might not get any increase in unemployment immediately, that over time employers are going to adjust and so the unemployment effect of the minimum wage law can actually get worse over time. But notice this really gives the mainstream economists very little information to work with. They have two data points. Basically the price of labor or wage rate and the quantity of labor that's employed or unemployed. Austrian economic analysis is going to take a much more holistic view so that we actually try to understand what's going on in labor markets beyond the two data points of wage rate and amount of employment and unemployment. As a result of their bare-bones approach, there's a lot of confusion within mainstream economics about what's going to result from a minimum wage. Okay, so on the one hand, you have economists who say, and I'll read this for those in the back, quote, there's just no evidence that raising the minimum wage costs jobs, at least when the starting point is as low as it is in modern America. This apparent defiance of the laws of supply and demand occurs because, quote, the market for labor isn't like the market for, say, wheat, because workers are people. Okay, so on the one hand, the minimum wage does not cause a loss in jobs. On the other, we have economists who believe, quote, any Econ 101 student can tell you the answer. The higher wage reduces the quantity of labor demanded and hence leads to unemployment. Clearly, these advocates of the minimum wage law very much want to believe that the price of labor, unlike that of gasoline or Manhattan apartments, can be set based on considerations of justice, not supply and demand without unpleasant side effects. So, one group say there's no evidence that it costs jobs, and the other side says it's obvious that it's going to cause jobs. And Sue, who are these people who said these quotes? Well, on the first hand, it's Paul Krugman. But on the other hand, it's Paul Krugman. If you write long enough and unorganized enough as Paul Krugman does, eventually you will end up taking both sides of every issue. More recently, of course, the debate that's in the media today is the Seattle minimum wage debate because studies have been coming out examining the effect of Seattle's move from $11 to $13 to $15 an hour. It's staggered and it's confused because if you pay health benefits, you can be exempt. If you're small business, you can be exempt for a little while. And so it's a lot more complicated than that and difficult to study empirically. Okay, so the University of Washington study came out and it looked not just at food service, but for all industries with much in the way of low wage workers. And they found that it reduced the number of hours worked in those industries by 9%. They found that the increase in wages in those industries was about 3% because it's looking at the entire workforce in these low wage industries so you don't get a big 18% increase. And this reduced monthly pay by $125. So if you were a low skilled worker working in a job, you got an increase in your wage rate, but you also lost hours. And so you ended up with actually a smaller paycheck. And also they found that in these same industries that there was a big increase in the hiring of people earning $19 or more. So in other words, skilled labor, their output actually expanded. So we're not talking about the dishwasher, we're talking about the cook or the chef. Now, in the University of California at Berkeley study, and by the way, the University of California at Berkeley study came out mysteriously very recently. It seems that the University of Washington study, a draft of that was shown to the city council and the mayor. And the mayor made a special call to Berkeley because if you want a positive spin on the minimum wage, where better to go than Berkeley? The People's Republic of Berkeley. And so their study finds that the increase of 18% from $11 to $13, that there was no change for labor in the high-end restaurants, restaurants where you get waited on, there's people dispensing water and drinks, so on. So this is the relatively high-skilled people within the food industry in Seattle. So these people could be exempt if they collected tips or if they gave healthcare benefits, but they actually saw an increase in employment within this group of in the food service where you're getting full service.  Limited service, they saw increases of about 4%. And they saw a decrease in the number of hours worked by 13%. And so if you increase wages across the food service industry by 4%, but hours worked declined by 13%, which is not surprising, giving that the minimum wage increases by 18%, then your paycheck is going to decline, although the study itself didn't, I didn't see any actual numbers about that decline. So the University of California at Berkeley had a very positive spin, no harm here, not much harm here. The Washington study found that there was basically, for low-wage people were hurt, their paychecks were lower, and high-skilled workers were helped. Now in the press, this is discussed as if it's one side versus the other, but actually both studies say similar things. You would never know it just by reading the New York Times or the Seattle, whatever the newspaper is there. It's always one versus the other. But if you want to look at both studies carefully, they both basically say the same thing, that higher wages led to a decrease in the number of hours worked and that reduced monthly pay. So in the immediate run, the response in terms of the employers was not to fire people, but just to take away their hours. It takes some time to reduce your workforce.  That's very bad for morale. But if you reduce people's hours, some people will quit and you'll end up creating unemployment over the intermediate term. And both studies find a substitution of high-skilled workers for low-skilled workers. Okay, whether it's low-wage industries or the food service industry, basically you saw relatively more of the high-skilled workers getting their jobs, keeping their hours, or finding more employment when the real harm comes to the low-skilled people. Okay, and also they kind of left out, although there's a lot of debate between the two teams, but Seattle, Washington is the biggest bubble in the world right now. Okay, it is one of the coolest cities and they have great employers that pay high wages, Boeing, Microsoft, Amazon, Nordstroms. These are all kind of very trendy, big and important industries, companies. And the Seattle area is in a complete and utter bubble. You've probably seen the construction cranes in Auburn. Actually, for a couple of days we had three of them in the city. We've never had one in the past. In Seattle, the super-high construction cranes, the ones that go up 40, 50, 60 stories, there are now more super-high construction cranes in the city of Seattle than in the city of New York and Los Angeles combined. So there's a bubble throughout the American economy, but the bubble is most intense in these trendy cities like Seattle, which is the best example of what's going on. Okay, the Austrian perspective, the minimum wage law is going to cause some combination of the following effects. So again, we're looking at multiple effects, not just unemployment, but certainly unemployment is one of them. We expect first fewer hours than fewer jobs, ultimately fewer employees, excuse me, employers. And for the employers, hardest hit will be small businesses, small businesses that don't have corporate headquarters that can steer them through the troubles that the minimum wage brings about. So mom and pop restaurant can't adjust the same way that McDonald's can. So McDonald's has responded to this wave of minimum wage law increases by developing and now installing kiosks. And I've seen them not in Auburn, but around, where you place your order into a computer kiosk, and so that eliminates the person who takes orders and makes change. It's all automated, you pay with a card. So that's going to happen. There's going to be a decrease in job benefits as a result of increases in the minimum wage, so you can expect things like, these are things you've heard of, health insurance, vacation and sick days, or even clean uniforms. So some businesses provide you with a clean uniform to wear every day you come to the job. Other places might give you a couple, but you've got to clean them and so forth. So those kind of benefits can be diminished as a result. So the employers, the contract seems to be just wages and hours, but it also implies everything else about the business, everything else about the job. So that employees should experience less job satisfaction. As the minimum wage is raised, you get more dollars, but you get less employee satisfaction from these other aspects of the job. Then decreased job desirability. Okay, these are things that are also under the control of the employer. So for example, the employer can make you work harder. So instead of coming in at lunch from 10 to 2 to work at a restaurant, you may come in at 10.30 and leave at 1.30. The easiest hour is at the beginning and end of lunch when there's very few customers, right? The hardest part of the job is when there's always a line waiting to get in to a restaurant. They can make you work harder. They can hire janitors for a smaller number of hours so that the place is dirtier, greasier, whatever. They can reduce the amount of lighting. They can reduce air conditioning just by changing the thermostat or heat. All of those things can be changed by the employer. And then on the capital side, you see that an increase in the minimum wage for low-skilled workers can increase the demand for high-skilled workers. And we saw that in both the Berkeley and the University of Washington study that the group with high skills actually saw an increased demand for their labor and possibly even an increase in their wages. And then of course I already mentioned that jobs can be automated with capital. McDonald's is nothing but a study in the replacement of labor with capital. The more increases you get in the minimum wage law, the more likely you are to see automation as part of the workforce. Again, small businesses can't do something like this. They don't have corporate headquarters working on a kiosk for their business. The minimum wage law can also lead to discrimination. Remember at the very beginning I said that raising the minimum wage decreases the demand for labor and increases the supply of labor. So that now employers have a choice over a wider variety of possible employees without any differentiation in wages. Potential employees cannot compete on the basis of wages. And so this opens up the potential for discrimination in labor markets. So when the minimum wage is increased, we see an influx of middle and upper income teenagers entering the workforce. We see housewives get into the workforce with those higher minimum wages. So there's a much bigger supply and much less demand. And so this opens up the opportunity for employers to discriminate. In other words, if they do have bias in their heart, this allows them to exploit that bias in the workforce by choosing either more productive people or just people they would prefer to work around. When discussing this at Auburn University with my freshman students, I say, well, let's look at rent control, which is a similar type of price control. Let's say Auburn passed a rent control where apartments could be priced at no more than $200 a month. And I've got an apartment that I used to be able to rent for $550 a month. And you own the apartment. And I want you to tell me what person in this room, if I want the apartment, he wants the apartment, he wants the apartment. Everybody in here wants the apartment. Who are you going to rent the apartment to? Or you'd rent it to me. Yeah. You're going to rent it to your teacher. Well, that's the same thing goes on in labor markets. People can exploit their biases in the form of discrimination of the employees that they hire. So there tends to be a lot of discrimination against minorities. There tends to be a lot of discrimination towards people without any experience. Or there's more discrimination against people who have, for physical, mental, whatever reason, have lower productivity than the average person in the low-skill labor market. So we would expect to see minorities and teenagers and others with much higher unemployment rates and actually some mainstream economists actually get this point about discrimination. I don't want to insinuate that they don't. So let's look at unemployment rates in the U.S. economy. The latest reporting quarter, second quarter of 2017, total unemployment rate is 4.2%. That's 100% of the labor market according to the Bureau of Labor Statistics. So unemployment is relatively low right now. If we looked at all teenagers, people with low levels of experience, the unemployment rate is 16.4%. Now if teenagers could offer their services at less than $7.25 an hour, we would expect that the difference between total unemployment and total teenage unemployment to be almost zero. It might be a little above or a little bit below, but we wouldn't expect this huge difference here between the total market and the market for teenage unskilled, unexperienced workers. White teenagers actually have a lower unemployment rate than total teenage unemployment. So employers are marginally discriminating in favor of white teenagers. Black teenagers, however, have an unemployment rate of almost 28%. So there's evidence that employers are able to discriminate against black teenagers, although there are other circumstances that we'd like to take into consideration, like the location of people, the location of jobs and so forth, that might reduce that differential. Hispanic teenagers fall somewhere in between about 19% unemployment. And the thing about this is that learning to be an employee, to work in the workforce, to integrate yourself into a job is very, very vital, especially if you're from low income or even lower middle income, getting job experience. And it's not like learning how to wash dishes type of experience. It's like experience of showing up for work, ready to work on time every day that you're scheduled. You need to learn that kind of thing early on because if you don't and you fail to learn that quickly and early, your outcome in the labor market over the course of your life is going to be much diminished. Okay, so basically, Austrians have a different, more holistic approach to this and it's not just a matter of wage rate. It's not just a matter of the number of people employed. It's how many hours are they getting? What kind of job satisfaction are they getting? What kind of non-wage benefits are they receiving? What are the conditions within the workplace? All of those things really matter. They're not accounted for in any of these studies. This study looked at the average unemployment rate in the European Union with countries with a minimum wage and without a minimum wage. They're asking, oh my God, there's countries without a minimum wage? When they just explode and fall apart and the world would come to an end? No, I think it's like 20% of the European Union countries don't have any minimum wage and typically they have very low unemployment and they have relatively low teenage unemployment. Actually there was another study about Denmark. In Denmark, they have a minimum wage for teenagers and their teenage unemployment statistics look pretty good. But once you turn 18, the minimum wage for 18 plus goes up by 40%. Not surprisingly, a lot of people on their 18th birthday lose their job. It's an enormous difference that occurs on the 18th birthday. So we know that that unemployment is the result of the jacking up of the minimum wage at that point. But basically the orange line here on top is the countries with a minimum wage and the blue line below is countries without a minimum wage. And this is overall unemployment, not teenage unemployment. So that during the bubble here from 2004 down to 2008, you see the bubble having its effect on reducing unemployment rates and there's not much of a differential here. And then when the bust comes in Europe, the unemployment rate in countries with a minimum wage goes up to 12% and it increases in the bust in countries without a minimum wage to 8%. So the unemployment rate, if we could rely just on this one factor, which we actually can't, but if we just looked at that one factor, the unemployment rate of countries with a minimum wage has an unemployment rate 50% greater than those countries without a minimum wage. So it's fairly clear, it's fairly open the impact there. This is another study in the U.S. that looked at teenage unemployment from January of 2008 at the beginning of the bust to October 2009. And this is all on an index level so that before the increase took place in mid 2009, this is the last time we raised our minimum wage, throughout this bust in the economy through 2008 in the first half of 2009, teenage unemployment decreased by about 10%. So it took 18 months for the unemployment rate of teenagers in the United States to fall about 10%. Either in anticipation of the increase or because of the bust in the housing market. But then after the increase took place, the three months after the increase took place, teenage unemployment fell by 8%. So 10% over 18 months versus 8% over three months. So there was a drastic decline after the minimum wage was increased. And so it's pretty clear what's going on here. The increases in the minimum wage, which took place in July of 2009, really did matter a significant amount when you basically reduce employment by 8% after you've already seen a 10% increase in unemployment. So in conclusion, wage rates determine market conditions, are determined by market conditions, the relative scarcity of human and non-human resources are capital. I don't know why I used non-human resources. That's more of a mainstream approach. And that's very clear from the Austrian analysis. There's no ambiguity in the Austrian analysis. There is no unemployment in a pure free market economy. So anytime we look at situations of high unemployment, what we're really seeing is government interventions or business cycle associated unemployment. Real wage rate increases in the free market are not driven by the political process, but they're dominated by economic processes of savings turning into investment, creating better tools for workers to work with, increasing their productivity, and therefore increasing their wages and their standards of living. So the way you make people wealthy is through savings and investment. Workers are going to get part of the benefit of successful investments in the economy. If you make workers more productive, employers are going to have to pay them more. You're going to develop more skilled workers and less unskilled workers in that type of an economy. So it's also related to the expansion of the structure of production. You expand the structure of production, you produce more product, you have more productivity, wages go higher. That's why wages are relatively high in the United States and Canada and relatively low in Mexico and Central America. It's capital investment that drives that whole process and savings drives investment. And very noteworthy to make is the point that early experience in the job market is vital to the full lifetime development of a worker. And ultimately the minimum wage hurts their intended beneficiary. The minimum wage is supposed to target poor people, people with low income. People have a harder time getting into the labor market. But that's precisely the people who are being hurt. As more people come into the workforce to take advantage of the minimum wage, you're really forcing out those who have low skill levels like teenagers, who have disadvantages in the job market such as minorities, disabled people and so forth. Those are people who are basically driven from the labor market left to their own devices. There are lots of things you can do to help the poor. I've listed just a few of them to give you some idea of the types of things that ultimately help the poor and make it easier for them to transition from being poor into being not poor. That's the key. I would eliminate the minimum wage law and compulsory education. Given the state of public education in certain areas where people are most negatively affected by the minimum wage, I would let people out of school and into the workforce if they wanted to because job experience leads to higher wages over their lifetime. I would eliminate monopoly grants by governments over certain professions so that more people could get into those professions and hire more people to work in their businesses. This lowers the cost of living for everybody and increases opportunity for everybody. I would eliminate taxes on labor. That's no brainer. You get more labor if you don't tax it. You get higher incomes after tax incomes, obviously, if you reduce or eliminate taxes on labor. Certainly we could eliminate a lot of the deductions that people see in their paychecks in terms of taxes and unemployment insurance and all that. If you have a free market in labor, you don't need unemployment insurance. People would have higher wages and incomes and there would be more jobs available. I would also like to eliminate the welfare trap, which people who are eliminated as a result of the minimum wage ultimately find themselves trapped in the welfare system, which again is very destructive to lifetime earning capacity. In final summary, the minimum wage is bad. It hurts their intended beneficiary, and there's a lot better ways that we know would work to make these people better off. Okay, thank you very much. We've got about four minutes. So what are the sides that you used to look at how minimum wage hurts or do you look at the unemployment rates? Maybe in a better way, because I feel that it hurts them even more if we just looked at workforce participation rates. Well, that certainly isn't... You know, you want to look at a lot of statistics. I can't present them all here, but I think it's important that Austrians already look at more of these vital signs than mainstream economists. Yes? I don't have anything on the tip of my tongue, but certainly there have been studies of that that people who entered the workforce at 16 in this type of job do better than someone who enters when they're 20. Now, of course, if you looked at people who stayed out of the workforce and went to college, they're going to do better than the person who doesn't have that opportunity. So it's a little tricky to say that that applies globally to everyone because it certainly doesn't apply in the past at least to students who stayed out of the workforce, went to college and learned both more generally about the world and more specifically about doing an occupation. So basically just kind of taking back off of that. At least this is an assumption I'm going to make. Correct me if I'm wrong. You say that compulsory education isn't the way to help with the poor. So would you say that it doesn't necessarily lead to going to college or would it be connected to it? Yeah, I mean, if you're stuck in a poorly performing school district, I think it's generally, it helps people to get work skills, whether that's part-time and staying in school or whether that's full-time and hopefully transitioning to a higher-skilled job. I mean, I've seen this growing up is that, you know, high school students take particular jobs. I'm thinking one I had myself was dishwasher, janitor type stuff in a hospital cafeteria and some of those high school students would graduate from high school and go to college. Others would graduate from high school and stay in the hospital cafeteria. They wouldn't be dishwashers. They'd probably be cooks and things like that. So it depends on the individual. What I'm hoping to do, what I'm hoping to explain is that you need to increase the opportunities for people and the minimum wage is something that squashes that to a certain extent. Yes? If we were to abolish the minimum wage, I mean, I don't kind of get a point about it on the sticky wages. What would the time frame look like on that? Like in the United States, how long would it take for us to be able to see that? Well, it would take some time. Just as it takes time for employers to make adjustments throughout their business to how many people are working, how many hours, how much capital versus labor, how much high-skilled versus low-skilled, they've got to make all those adjustments. So it's going to take a matter of a few years for things to fully adjust and for people to get used to a different set of knowledge so that the starting salaries for low-skilled workers in hope like Alabama might fall to $6 an hour. In New York City, they wouldn't fall at all. So it depends on the local economy as well. There would be no need for adjustment in certain places and there would be need for substantial adjustment in other places, and so that might take a year, 18 months, two years or longer for a full adjustment to take place. Thank you.


So currently we're uninstalling, reinstalling and conducting an expeditionary certification on the two AM2 pads at the PMM squadrons. This actually allows us to work in the Marine Corps organically to do these certifications on these pads. And this kind of goes hand in hand with General Berger's EBO concept of being able to do these expeditionary airfield operations organically to ourselves without having to spend the money on a civilian engineer to come out and certify a pad. This is actually one of the first times that we've been able to conduct as 7002s and 7011 EF Marines to conduct an expeditionary certification on any EF asset in the AOR since OIF. We've usually been able to bank on the civilian certifiers to come out, but like I said, this allows us to work organically amongst ourselves. Doing a project like this really adds to the camaraderie amongst us as a Marine Wing support detachment out here. The airfield operations Marines working alongside the support machine Marines conducting the horizontal construction just adds to our operational readiness and it strengthens our bond amongst ourselves as a detachment.


When I first came to getting in Hackerspace, I thought it's just a flat in the city center of getting in, but then I was welcomed, oh, oh, you cannot just enter, you need to log in by SSH, we need your key. So I got my key into the server and then the Arduino, when I logged in, there were four options. One of them was open the lock. The second was arm the lock and the third was this arm the lock, and then the doors opened. After I came in, I was welcomed by people who did 3D printing all the time, and on the wall what I've seen was the electronics shop, basically. All the components nicely sorted all the capacitors and the resistors and everything. Next to it was of course the electronics bench, and people have met there usually every week to pursue their projects. Most of them were staying in Hackerspace, usually that was explained by the fact that most of the people found their partners and families more willing to look at the device for a short time, but more not necessary for a long time. So pretty much all the Hackerspace was mechanized and it also has an awesome wiki that classifies all the available components there. So it looks like electronics shop. Also there were a lot of meetups for the crypto parties and Fryfunk, and now they got connected to this Fryfunk initiative in Germany. They also have their own software for it that basically tries to connect Wi-Fi networks in a mesh manner. They still have to have a broadband connection to Sweden to get around the laws of Germany that as a network provider you are responsible for the content that is on the network. So it's still not optimal, but they end to just connect themselves to the Rhineland Fryfunk that already provides the free network everywhere because it has the official registration as a network provider large enough that they don't are not anymore responsible for the content in their network, otherwise they could be sued. The other makerspace that I visited was Amsterdam Makerspace that basically has all these data printers and when I came there I believed that because they have like a separate hardware room that most of what they do with printers is producing new printers, really. So that was a short trial, I would encourage you to visit both makerspaces. They of course have very strong makerspace component and since I've played with hardware more I didn't really look into the other parts. I have a question, actually it's a question for everybody because I experienced


From the SiliconANGLE Media Office in Boston, Massachusetts, it's theCUBE. Now, here's your host, Stu Miniman. Hi, I'm Stu Miniman, and welcome to a special CUBE conversation here in our Boston area studio. Happy to welcome to the program first time guest, Patrick Morley, who's the CEO of Carbon Black, course recently announced acquisition by VMware of $2.1 billion. Patrick, thanks so much for joining us. Stu, thanks for having me. All right, so we love digging into tech. There is no hotter space than security, all the cybers, really exciting stuff, and even your company's Waltham-based, so actually a little closer to Boston than we are here in Marlboro, Massachusetts. When we had a green screen, we used to kind of fake it with the skyline, but the Boston area, people know more than just Massachusetts tech, but a lot of great technology in Boston, of course, a lot of good technologies, a lot of good schools that have driven things. You have been CEO since 2007, and have seen quite a bit. Merger, Bit9 and Carbon Black many years ago. IPO, not that long ago in the past, and now acquisition, as we said, for $2.1 billion. So give us a little bit of a step back as to the journey, how we got here, and what's it like to be kind of at the home with your crew through all of those changes? Yep, well, certainly very proud and very thankful to all of the customers that have been with us for many, many, many years. And as you said when you first started here, Boston is an awesome place for cybersecurity. I think it fits a bit of the personality on the East Coast, and if you just look at Boston in general, there's a lot of great cybersecurity talent, a lot of great cybersecurity companies, and I'm extremely proud and grateful to all of my employees in Massachusetts who have built Carbon Black over the last number of years. And of course we have offices elsewhere across the globe, but Boston and Massachusetts is where the company's roots really come from. And as you said, 2007 is when I joined the company. Obviously, cyber was a very different world back then, and it's amazing if you just kind of roll back. In 2007, the idea of a CISO, a chief information security officer, was still very new. And most companies we dealt with back then did not have a CISO. They had a network administrator or somebody. So that's all changed. If you look at security as a board level issue, in 2007 there were certainly some areas of some sectors like the government where it had a lot of importance, but outside of that it did not have the same visibility as a strategic issue as it does now. It's amazing. So much, my background is networking and virtualization. I spent a lot of time, since 2007, looking at all the cloud world. And as I said, back in the early 2000s, security was top of mind, but often bottom of budget. The network people, back in the day, it was like, can't you just lock the door or make sure the rack is secure and well, we'll run things over optical and therefore we'll know if somebody splices into it from a networking standpoint. Today, as you stated, clearly it's board level discussion, CISOs rising power in the organization and often dictating a lot of how the stack is built. Absolutely. So, wow, it brings a little bit, your portfolio, security is not a thing. Any customer I talk to, there is no such thing as a silver bullet in security. Most customers I talk to really think of security as a programmatic effort. So, help us understand a little bit where carbon black fits today and then we'll get into your broadened scope once you're gonna be under VMware. Yeah, so the core founding idea behind carbon black was a simple one, which was that fundamentally, the adversary was in a position where they eventually would figure out a way to get in. And if you fundamentally believe that, then you do everything you can to stop the adversary, but you say I need telemetry, I need data in order to understand what's happening across my environment in order to be able to see and stop the adversary. And so, we began a journey to essentially be able to collect and analyze all the data that an adversary, that an attacker would touch in order to run their program. And we always have equated it to essentially a movie camera that allows you to rewind the tape. And with all that data that we collect, we can run tremendous analytics against that in order to be able to see and stop the adversary and understand what's happening across the environment. We essentially created a market that's now called EDR, End Point Detection and Response. And it's that simple idea of being able to understand and have situational analysis, situational visibility across the whole enterprise. We did that initially on premise. So we did all that analytics and each one of our customers back ends in their data center. And two years ago, we began a journey to say, look, we want to do two things. One is we want to leverage that data to be able to provide more security capabilities across a platform. So let's revolutionize, continue to revolutionize cybersecurity by offering a cloud-based platform. We're going to move all of that analytics up into the cloud. All those capabilities up into the cloud and offer a multi-tenant cloud-native SaaS platform. And over the last two years, we've done that with multiple services now up on that cloud with thousands of customers who are using it. And the benefits of the cloud are pretty straightforward and they've revolutionized other industries. They're revolutionizing cyber right now. Certainly, you can analyze data at a scale that's just not possible when that data is locked up in multiple customers. So that's one big change. Obviously, you- Yeah, I just want to help unpack and tease out that data piece. We always hear out there and it almost, it's a bit trite, the importance of data. Data is the new oil, it's the rocket ship. But the value of that data, how much of that is Carbon Black leveraging the data? How much can the customer themselves take advantage of that data? Or this isn't in the vacuum. There are other security products, other pieces of that vendor stack that might be able to leverage that data. Yeah, well, Carbon Black's a cloud native platform, security platform is built on a totally, it's totally open. So from an API basis. So you should think about it. Our customers certainly think about it this way. As one, we're leveraging that data. We analyze a trillion security events a day. One trillion, just immense. And the benefit of that is if we see something across the globe that has a high risk score that's known now, where that might be a new form of attack, that might be a living off the land attack, all of our customers get the benefit of that analytics. So Carbon Black, we certainly leverage it. But in addition, the way we've built the platform, customers can get access to all the data from their enterprise. And they can correlate that data with other aspects of their security or their IT infrastructure in order to build a more holistic view across the entire enterprise. And we also have third party partners out there, managed security service providers and others, who also have access to that data for their customer set to be able to run analytics on it. So when we think about data, as you said, as the oil of the new world, we think we need to leverage that data. But we also need in this new world order to give our partners and our customers the capabilities to do what they want with that data as well for their own data. Yeah, love that. Especially if you're talking in that cloud native world, it can't just be something that's locked up and only used for environment. We track the observability companies out there. They have similar type of messaging. Of course, data protection. Once there is that breach, how do I recover from this information? So that ripple effect and love, openness, APIs, making sure that can be shared. Maybe not something that traditionally I'd heard from VMware when you talk about the openness and where they're doing. Maybe, I think there are a couple of things you want to talk about Carbon Black, but want to get to the VMware piece. Yeah, well, I was just going to, on the cloud side, the power of the cloud, obviously it's revolutionized other industries. And certainly one of it is the ability to provide analytics at scale. The other piece, which I already mentioned is the network effect of my ability to see something somewhere across the globe and help millions of other customers across the globe when I see something. And the other piece is just my ability to deploy quickly and my ability to innovate quickly. Because rather than having to deliver new software into each enterprise, I can do that on my cloud native platform. So I think it positions the defender, the security teams around the globe, where they can be more on the offensive than they've ever been before. Because suddenly I don't have to spend my time worrying about deployment mechanics or other pieces. I can focus on what I really want to do, which is I want to secure my environment. I want to be able to understand what the adversary might be doing. So we're real excited about what we've done over the last two years with our cloud platform. Okay, so the deal hasn't closed yet, but it's been announced that you will be leading up the cloud security group at VMware. Gives a little bit directionally, where's that heading? What will that mean? Of course, we've tracked where VMware touches a lot of that environment. With my background in networking, I talked to the ICERA team before and then through what's become a very successful NSX. Sanjay Poonan with the AirWatch acquisition and where they've gone, of course I would expect that. That's the closest piece that you started out with the endpoint protection with that team, with the workforce one. So explain kind of the security portfolio and interesting cloud security is the discussion because that's the newer piece of the carbon black portfolio, help us understand how the whole, all the pieces fit together. Yeah, so first I'll just reiterate what you said, which is the transaction is not yet closed. So everything I'm talking about is pre-closed and obviously post-closed will have additional commentary about what everything will look like. But absolutely we are very, my team, my customers, we announced the transaction a little over a month ago. Everyone is really, really excited. And I think fundamentally they're excited because organizations understand what carbon black delivers today and what we deliver are great security products. And increasingly the majority of those products are in the cloud. And VMware has a tremendous reputation in the industry for the technical capabilities, for the value that they provide to customers and just for the breadth of the portfolio that they have. You mentioned a few of them, right? Many organizations and people think about VMware from a virtualization standpoint. But increasingly over the last few years they've dramatically expanded their portfolio, network virtualization, NSX, the Workspace One as well, which was based on the AirWatch acquisition they did. Those are big businesses today and they're helping organizations transform their infrastructure, the way they manage devices, et cetera. And so carbon black on the security side, we've been partnered with VMware for the last couple of years. We've had an opportunity to get to know each other quite well. We had an opportunity to integrate in two key spots. One, we've integrated with their APTI capabilities, which you can think about essentially as helping to protect and provide telemetry for what's happening inside of the virtualized environment. And then secondarily, we've also partnered with Workspace One as well, again more on the device side. Those are two natural points where security, building security intrinsically into that compute stack we've seen with customer reaction has a fundamental impact on being able to have security right there rather than having to bolt it on afterwards. Yeah, you walk into an interesting configuration. First of all, as you said, VMware not thought of as a security company per se, lots of products that absolutely fit in the security space and are there. When you look out, of course, VMware, primarily owned by Dell, there's SecureWorks, there's RSA, those are well-known security brands. Give us how you think of how all those pieces go together and kind of the trajectory of where things are headed. Yeah, well, goal number one, once we close the transaction, goal number one is to do two things. One, we're going to continue to drive forward with the cloud roadmap that we have. It's an aggressive roadmap. We've been innovating aggressively over the last couple of years and we're going to continue to do that within VMware. The second piece is obviously to maximize the opportunity to build security into the compute stack of VMware so that when customers think about security, they don't have to think about it as a separate piece, but it's already there at their fingertips. And then as you mentioned, so those are two big goals right there. And as you mentioned, obviously Dell has a large portfolio. There's other security products within the Dell portfolio. And when we think about that, obviously over time, we're already partnered with some of those. SecureWorks, for example, has been a very close and valuable partner of Carbon Blacks for many years. You'll see us continue to partner. There's other parts of the Dell family where we have partnered in the past, not tightly, but I think we'll have the opportunity to do more as part of the Dell family. All of this means for customers more value. Because rather than having to go and figure it out themselves, we're going to be delivering it in conjunction with the solutions that are already using. All right, Patrick, I want to help you have you address a schism I see in the marketplace when it comes to the messaging around security. When peers of mine went to the RSA conference this year, they came back almost unanimously with two words, doom and gloom. Right. In Boston this year, Amazon held the inaugural reinforce, positioned itself as the cloud security conference for the industry. We covered that with both of those shows with theCUBE and Stephen Schmidt from AWS said, the state of cloud security is strong. VMware very much, we hear from Pat, we need to do over security is broken. Friends of mine in the security industry, Carbon Black's been around since 2002 is come on. It's not just another acquisition. It's not going to be a point product. Yes, we have work to do as a whole, but saying we need to do over it's broken is a bit hyperbolic from my peers in the industry. So what is the state of the industry? Is there traditional storage and cloud storage? Is all rainbows and unicorns or where do you see it today? Of course we know as an industry there's always work to do, but how do you round that circle? Yeah, I would take it. And you're right by the way, I hear all the same commentary. And I think we have to take a step back and just look at industry, the industry in general, look at security in general. We started the interview talking about well what was the world like in security in 2007. Security has gone from, hey, it's a niche area over here and we know it's important but don't talk to us to super strategic. Again, at a board level, at a company level. And so that rapid growth has driven a lot of funding into the environment, a lot of vendors. There's over 5,000 security vendors out there today all competing. I don't know how CISOs and CIOs and practitioners really figure out who does what, it's very challenging. And at the same time, you've got the adversary, this third party continuing to advance their attack types, using new techniques. You've got ransomware, which is a huge industry now driving billions of dollars. So you have all of that happening and so in hyper growth environments like that, you get a lot of vendors. The average enterprise security team has 75 different products and so they have to stitch that together. So the fundamentals of what, the way you described it, I think are accurate on both sides. One, security's broken, it is broken. We've got too many vendors and we're bolting it on. We've got to fix that. VMware is in a position partnered with Carbon Black to do that, I think, really well. The second piece is that the cloud does allow us, I'm not sure about rainbows, but the cloud does allow us to change security fundamentally because of some of the characteristics I described earlier. And if you take Carbon Black plus VMware, plus what VMware is doing to deliver across any cloud, any device, any application, I think we're in a really interesting spot to help customers get more value from their compute stack and from security. Yeah, one of the things that VMware has always done well is they play in multiple environments. Back in the early days of server virtualization, didn't matter what hardware, they would get that across. Their cloud strategy went through quite a few iterations. Sanjay Poonan came in our program and said, VCloud Air, we failed, we got it wrong, we did it, but today, every cloud show I go to, there's a VMware piece of that. They're partnering with AWS, with Azure, with Google, with Alibaba, with Oracle even, and IBM recently. But still one of the critiques I have for VMware is, VMware does good at managing their house. But security customers, as you said, they've got 75 tools and they're going to have their VMware state and they're going to have their native cloud pieces and they're going to have their non-VMware environment. So how can, once you're under VMware, participate in that environment, will you primarily be VMware environments in the VMware cloud environments or will it be a broader cloud security strategy? Yeah, well, I think certainly VMware has done an amazing job over the last few years of really pushing this any cloud model, right? Hey, no matter where your workloads are going to be in a hybrid cloud environment, we're going to be there to help you and help run them more effectively, more efficiently, faster, better performance, strong ROI. And so if you look at Carbon Black's roots, and I mentioned this earlier, one of our core beliefs is that one vendor can't do it all. You have to build on an open, extensible API-based platform and that's what we've done since the beginning of the company. And so you will not see Carbon Black change our philosophy. We will continue to be very, very open. And I think, by the way, that reflects very much VMware strategy as of late, which is an open strategy where they're playing with lots of providers in the marketplace. Again, the benefit of Carbon Black plus VMware on that platform is that for VMware infrastructure, their products, I think you're going to see out of the box security capabilities that are going to give advantage to customers from ease of use, from the way that that security works, et cetera.  All right. Patrick, we know, you mentioned how many different tools customers have to deal with. There are more new threats coming out every day. There's no way that a person or a team can keep up with all of this. So is AI the answer? How are these technologies going to be able to allow our systems to be able to protect us better in update? We haven't talked about AI yet. I know it does fit into your portfolio. So just understand how the systems and the software and the solutions are going to help enable teams to be able to keep up with the rapidly expanding and changing landscape insecurity. Yeah, AI is a tool. We use it. And just as I've mentioned cloud, right? Along with the ability to analyze trillions of events on a daily basis, things like AI can play a very significant role in helping me to understand what's happening across very large corpus of data. And so we use a lot of it. And that allows us to understand when there's an anomaly somewhere across the globe on some system, some endpoint or device anywhere across the globe and then leverage that to help our other customers. So AI is playing an important part. It will continue to play an important part. But AI leverages the data that we collect. So if you go back to where Carbon Black is today with all that data that we're analyzing, one of the really interesting things is VMware today has 70 million VMs. 60 million of those are on-prem, 10 million of them are on the cloud. Part of the benefit that Carbon Black gets from VMware is we're going to get all this additional telemetry that we're going to be able to again consume, leverage AI-like capabilities to help with the analysis of that. And again, provide more customer back to the value on seeing and stopping the adversary. That also extends to what VMware's doing on the device side with Workspace One, et cetera. So there's a lot of opportunity over the coming quarters and years to provide more value for customers in understanding what's happening across their environment. Because of all of the touch points we're going to have as part of the VMware compute stack. All right, Patrick, final thing. What does this mean for your customers? I think back to, not that long ago you did an IPO. What would that mean for the growth, the investment into technology and growing the team? Now, in industry parlance, you had another exit and you will be part of VMware. So we might not get as much visibility into the specific revenues and the hiring that you're doing there. But what will this ultimately mean for Carbon Black's current and potential future customers? Yeah, so we have over 5,000 global customers out there today. And first and foremost, it's going to mean more investment from a product roadmap standpoint. If you look at 2019 this year, the number one area of investment for Carbon Black was in R&D. And as we move forward, again, post close, you, our customers are going to see continued investment in the platform, in our cloud security platform, in order to ensure we continue to bring more capabilities to market. And then, as I said earlier, in conjunction with that, do everything we can to integrate in with the VMware product portfolio, again, so that security's not bolted on, but it's intrinsic to the compute stack. And so I think that's the biggest thing. I have had the opportunity to go out and speak to many customers over the last four weeks. Customer and partner reaction has been outstanding. They get it, they understand it, they understand that there's a better way, and that's what we're going to be doing as part of VMware. Yeah, any surprising nuggets in the last month talking to the customers and partners more that you've learned? It's going to sell in self-serving, but it's the truth. I will tell you that the VMware reputation out there is outstanding. I mean, and I have been surprised at how little I have to do to tell them why this makes so much sense. They get it, the majority of our customers get it, they understand the possibilities of what we can provide, and there's a level of excitement out there, again, with our customers and partners. It's just, it's awesome. Patrick Morley, CEO of Carbon Black, thank you so much for joining us on theCUBE. Stu, thanks. All right, lots of coverage, of course, through 2019 and gearing up for 2020, where we'll all have perfect hindsight, I'm sure. Check out thecube.net for the events we've been at, search where we're going to be, and please reach out if you have any questions. I'm Stu Miniman, and as always, thank you for watching theCUBE.