Greg Morin is the CEO and owner of Seachem Laboratories Inc.
Greg is a chemist, entrepreneur, writer/blogger on a host of libertarian topics, and a Mises Institute Society Member. The following interview is an excerpt from The Austrian 1, no. 6 (2015).
GREG MORIN: Quite by chance, actually. Back when the bubble was collapsing in the fall of 2008 I was on an adult recreational league soccer team and one of the other team members was Erich Mattei — a former Mises U grad and student of Walter Block’s. There was an email exchange between some of us on the team about all the silly things they were doing to stem the market collapse and after the jokes died down Erich suggested I check out the Mises Institute if I wanted to learn more about what was actually going on. So I did. And I ended up buying The Mystery of Banking by Murray Rothbard, and that was that. I was drawn in by the clarity of his prose and the undeniable logic of the ideas and soon ordered book after book.
TA: Why did you decide that the Mises Institute was something you wanted to support?
GM: I decided to support the Mises Institute after attending some of their events (Mises Circle events and the Austrian Economics Research Conference) and it became clear that everyone involved or associated with the Institute were true scholars and professionals. I knew my money would not be wasted. I also quickly came to appreciate the importance of what the Institute was doing — not merely acting as a think tank or clearing house of information but rather as a catalyst to ensure these ideas are passed on specifically to the next generation. Although “the children are our future” is certainly a clichéd insight it is nevertheless true. The more of the youth who understand the foundations of liberty today the greater the likelihood we will have a freer future. That mission, perhaps more than any other, is why I support the Mises Institute.
TA: As a business owner, what do you think, for you, are the most valuable insights the Austrian school has to offer?
GM: To be honest, I’m not sure. I say that not to discount the Austrian school but rather because of the fact that I’ve never taken any formal economics classes. I was not exposed to the subject at all until I encountered the Institute, so in learning economics the “proper” way from the beginning, I’m not sure what would be different had I learned it the other way. One tangible effect it has had in my business is how it has shaped our market investment decisions relative to my awareness of the market distortions caused by state intervention. I definitely don’t invest in any sort of government bond!
I’ve also mostly divested out of the market because it is apparent it is more akin to a government-run casino than a real market. Manipulation of the market fosters volatility and that makes it very difficult to make rational investments. I suppose I can say though that the purchase of gold and silver as an inflation hedge are definitely an outgrowth of my knowledge of AE. I’ve also come to realize that as entrepreneurs, none of us has any idea what we are doing! We make the best guess with the information we have and hope for the best and if we are wise (and lucky) we’ll adjust quickly if we can.
Ultimately it is the market that decides if we know what we are doing or not. I guess to sum it all up, Austrian insights distill the complexity of what we business owners do down to a very simple mantra: satisfy the desires of others. That’s it, that’s all any of us are trying to do. As an aside I’d say unexpectedly it’s given me better insights into how an employee relates to an employer. An employee is like any other vendor. They are a business unto themselves. If they wish to “win” in the employment market they must do what any vendor would, offer a product so good your customers wouldn’t dream of going anywhere else.
TA: Having worked in your field for more than one business cycle, how has the boom-bust cycle impacted your business and your employees, and how has your knowledge of Austrian economics helped you gain insight into the process?
GM: I’ve always run my business very conservatively even before I was aware of Austrian economics, so perhaps I was predisposed to its teachings as they made a lot of sense to someone that rejects the notion of massive amounts of leverage in order to foster growth. Prior to exposure to the Austrian school things like the Accumulated Earnings Tax were a baffling mystery to me. Now the motivation for this tax is all too transparent: the more times cash churns back and forth through the economy the more opportunities the state has to take its cut. Likewise, compelling companies to run on a shoe-string of cash means they have to borrow simply to maintain operations — and more borrowing means more inflation (due to fractional reserve lending) which means more tax revenue. I recognize how this mode of operation leaves a business financially fragile and at the mercy of the banks. I refuse to play that game. We maintain “large” (what I consider reasonable) cash balances and the stability we have gained from owning our cash (vs borrowing it) has allowed us to weather these storms. During the downturn in 2000 I learned the hard way the truth of the aphorism that a banker will give you an umbrella when it is sunny and take it away when it rains. Never again.
TA: Has Austrian economics helped you better understand how the government’s response (i.e., stimulus, taxation, regulation) to economic busts has impacted you and your business?
GM: I already had an intuitive sense on these things that they were bad for business (well everyone knows taxes are bad!). But yes, Austrian economics did help bring some focus in my mind as to just how disruptive state interference can be to running a business. The pain of these things has always been there, AE simply helped bring it into sharper focus. Unfortunately there’s not much one can do with that knowledge in either case. The state will do what the state will do and as business owners we are powerless to stop it. We have large capital investments and are relatively immobile. We are also “plugged into” the banking system. We cannot simply choose to go our own way or thumb our nose at the state. We are under constant threat of financial retaliation if we do not comply. Even if relocation were a viable option (it’s not for us because of the enormous capital investment needed to make that transition) there really isn’t any place on this planet significantly better. So as I mentioned with the second question, all we can do is hope that the next generation is influenced by the Mises Institute and that the investment we make now in supporting the Institute will pay out dividends of liberty in the future.