By: Anabell Alfonso
The United States has launched a series of unexpected financial maneuvers to support Argentina’s currency—moves that appear as much political as economic. Washington announced it would be stepping in to bail out Argentina’s economy. Since October 9, the Department of the Treasury has purchased roughly 400 million pesos, although neither government has confirmed the amount. The administration also plans to conduct a twenty billion currency swap—funded by U.S. taxpayers—and buy pesos to prop up the currency’s value. Additionally, Treasury Secretary Scott Bessent announced another twenty billion loan package backed by private-sector banks and sovereign wealth funds to help reduce Argentina’s debt. However, the swap line was contingent on President Milei’s party performing well in Argentina’s midterm elections.
Argentina has long battled chronic economic instability and struggled to control inflation. Since the 1950s, it has received more than twenty bailouts from the International Monetary Fund (IMF). President Milei, a libertarian who campaigned on free-market reforms, inherited triple-digit inflation when he took office in Buenos Aires. Known for wielding a chainsaw during rallies to symbolize his austerity agenda, Milei has slashed government spending in an effort to control inflation.
Since President Trump’s win in 2024, Milei has aligned himself with Trump, both economically and ideologically. The alignment seems to have paid off when the U.S. Treasury helped expedite IMF approval for a twenty billion recuse package—the second largest IMF deal of its kind—and later arranged direct support through the controversial swap line. The deal came with the caveat that U.S. backing could be withdrawn if Milei’s party faltered in the midterm elections. Furthermore, Milei’s ability to carry out his economic agenda rested on securing a legislative win. On October 26, Milei’s La Libertad Avanza party received 40.7 percent of the vote, sending Argentina’s currency and government bonds surging.
Trump congratulated Milei on the victory, viewing Argentina as a stepping-stone to reducing Chinese influence in Latin America. Yet these actions have fueled criticism that Trump is abandoning his “America First” platform. Trump, who campaigned on prioritizing American interests, faced questions from both supporters and economists about his economic strategies towards Argentina. Domestic polls indicate nearly half of Trump’s supporters oppose the plan.
To add fuel to the fire, Trump has decided to quadruple the tariff-free quota on Argentine beef, drawing backlash from many farm-state Republicans. Representatives from agricultural regions—many of them Trump allies—called the decision a “misguided effort” that would harm American farmers and ranchers. Trump argues that importing beef from Argentina would lower the prices for consumers, who have faced increasingly high beef prices. Many American farmers fear the move could further strain rural economies already under pressure.
