Milei Calls Business Owners Heroes and Rules Out Monetary Easing

A supply shock, not a policy failure

Speaking at the event marking the 160th anniversary of the Argentine Rural Society, President Javier Milei attributed the country's slower growth to an external supply shock and dismissed fiscal or monetary stimulus as the answer, while casting business owners as the economy's central engine. Economy Minister Luis Caputo and Foreign Minister Pablo Quirno had also spoken from the same stage earlier. Milei noted that he had landed from Spain after seven in the morning, and he took the floor past midday before an audience that included representatives of farming, energy and mining.^[S1]

The president's core argument rested on the idea of a negative supply shock: reduced oil supply caused by tensions in the Strait of Hormuz raises production costs, pushes prices upward and forces central banks to lift interest rates, which in turn cools activity. He told the business owners present that they were living through such a shock. From that reading, he sharply criticized those who propose offsetting it by expanding aggregate demand, whether through monetary or fiscal channels.^[S1]

Easing monetary policy when the broad monetary base has gone almost twelve months without growing, he argued, would amount to pouring fuel on a fire. Turning to fiscal deficits, he added that they are unworkable given current conditions in international credit markets. He said he did not know whether such proposals stem from ignorance or intellectual dishonesty, mainly among economists who insist on those alternatives, and he left open a third possibility: that some simply want the country to burn so it can return to its old ways. He concluded that nothing can replace sound economic policy.^[S1]

Heroes, rules and the role of the state

A substantial part of the address was devoted to defending the figure of the entrepreneur in theoretical terms. Milei cited the economist Israel Kirzner to explain that entrepreneurs spot a profit opportunity where others see a problem or see nothing at all, and the researcher Hernando de Soto to argue that this function creates information that did not previously exist and coordinates millions of people who do not know one another.^[S1]

On that basis the president drew a line between the state and the private sector: the former should set rules rather than distort them, while wealth creation belongs to business owners. He argued that prosperity results from institutions and the free interaction of individuals rather than from a nature that precedes human action. For that role he reserved a label that contrasts with earlier descriptions, saying he could find no other name for business owners than heroes. Outlets covering the event highlighted that characterization in their headlines.^{[S1][S2][S4][S7]}

Fiscal balance and the case against devaluation

Another stretch of the speech defended fiscal balance as the axis of the economic program and warned against those who propose qualifying it. Milei linked unbalanced public accounts to the macroeconomic distortions that, in his account, punished Argentina for nearly a century: debt, inflation, regulations and price controls are, in his reading, direct consequences of the fiscal deficit. He said every regulation and every devastating macroeconomic effect endured over eighty or ninety years corresponds to fiscal imbalance.^[S1]

The president was blunt with those who say they want a surplus but with sectoral exceptions. He argued that behind every caveat lies a spending commitment someone wants to preserve, and he summarized the position by saying that those who ask for a surplus with conditions are really asking for a deficit. A surplus, he added, requires political effort as well as economic effort, and he warned that those who promise paradise to win power can never sustain it. He closed that passage by saying fiscal balance is not negotiable, not even with any condition, to applause.^[S1]

Milei also rejected devaluation as a route to competitiveness, describing it as making Argentine goods cheaper at the expense of Argentines, eroding wages, destroying savings and devaluing companies overnight. He dismissed the underlying argument by noting that within months of a devaluation prices adjust and the structural problem remains. Instead he defended the path he said his government chose: lowering the tax burden and the cost of capital, deregulating the economy and promoting infrastructure through the private sector. He cited the tender for 9,000 kilometers of roads, progress on another 6,000 kilometers and the deregulation of the waterway, describing this as the genuine route by contrast with previous governments.^[S1]