Argentina’s turbulent political and economic landscape has once again captured global attention, with a dramatic series of events that intertwine the fate of two nations: Argentina and the United States. In late October 2025, Argentina’s far-right President Javier Milei pulled off an unexpected victory for his party, La Libertad Avanza (Liberty Advances), in midterm elections marked by the lowest voter turnout since the country’s return to democracy in 1983, according to Liberdade, Socialismo e Revolução. This win, however, is just one chapter in a much broader—and more contentious—story of international finance, political alliances, and the shifting priorities of both countries’ leaders.
Milei, who assumed office at the end of 2023, wasted no time implementing a sweeping set of austerity measures. He slashed public spending, pensions, and subsidies for transport, heating, and electricity. He deregulated rent, attacked labor and democratic rights, and privatized state enterprises such as the metal firm IMPSA. While these policies were met with fierce resistance from below—including a general strike in April 2025—critics argue that opposition leaders failed to sustain or escalate the movement, allowing Milei’s agenda to advance. The Peronist-led trade union bureaucracy, in particular, was accused of holding back the struggle, even declaring a trace after a successful general strike, according to Liberdade, Socialismo e Revolução.
Initially, Milei’s hardline economic approach appeared to yield results. Annual inflation, which had topped 200% in 2024, plummeted to 32% by September 2025, largely due to extreme austerity and a gradual fall of the official dollar exchange rate. Argentina’s GDP, after two years of decline, showed signs of recovery at the end of 2024. But this rebound proved short-lived. By the second and likely third quarters of 2025, the economy was back in recession, with GDP falling again and monthly inflation ticking up to 2.7% in October from a low of 1.5% in May, as reported by Liberdade, Socialismo e Revolução.
Milei’s administration was not without scandal. In February 2025, Milei promoted a cryptocurrency that turned out to be a scam. By August, allegations surfaced that his sister, Karina Milei—who holds a key government post—had accepted bribes related to drug contracts for medicines for disabled people. In October, José Luis Espert, Milei’s main candidate for the Buenos Aires Provincial parliament, stepped down after accusations he had received money from drug traffickers. These controversies dented Milei’s popularity and added to the mounting sense of crisis.
But perhaps the most dramatic twist came not from Buenos Aires, but from Washington. As Argentina’s currency, the peso, teetered on the brink—having already been devalued by 800% to bring the official rate closer to the market—Milei’s government found itself running out of options. With the peso’s value rising more slowly than inflation, trade deficits ballooned, and Argentinians with means began hoarding dollars rather than spending. The only way to keep dollars flowing into the economy was through loans, and Argentina’s external debt had already reached a record $305 billion by the end of the second quarter of 2025, including $55 billion owed to the IMF, according to Liberdade, Socialismo e Revolução.
Enter the United States. On October 20, 2025, the US Treasury signed a $20 billion currency swap agreement with Argentina, expandable to $40 billion—a move confirmed by both Liberdade, Socialismo e Revolução and NJToday News. This lifeline was not just a matter of international goodwill; it was explicitly political. President Donald Trump, who publicly endorsed Milei, made clear that continued US support was contingent on Milei’s electoral success. He had a lot of help from us. I gave him a very strong endorsement, Trump said, as reported by Liberdade, Socialismo e Revolução. Treasury Secretary Scott Bessent confirmed that the administration was working to secure an additional $20 billion from private banks and sovereign wealth funds, potentially increasing total aid to $40 billion, according to NJToday News.
But the US intervention did not stop at financial guarantees. On November 6, 2025, Senator Elizabeth Warren released letters confirming that JPMorgan Chase had purchased Argentine pesos on behalf of the US Treasury in October, as part of efforts to shore up Milei’s government ahead of the pivotal election, further cementing the direct involvement of American financial power in Argentina’s domestic affairs.
Why such a massive commitment to a foreign country, especially one that has a history of debt troubles? Economists and critics, as NJToday News notes, are baffled. Many see the bailout as less about economic logic—Argentina is not considered systemic to the global economy—and more about politics and geopolitics. The US move is widely interpreted as an attempt to prop up a political ally and counter Chinese influence in a region where Argentina has significant natural resources, including the world’s second-largest shale gas reserve, fourth-largest shale oil reserve, and 20% of known lithium reserves, according to Liberdade, Socialismo e Revolução.
Meanwhile, the contrast with domestic US policy could not be starker. As tens of billions of dollars flow to Argentina, the Trump administration has been cutting funding for critical infrastructure and anti-poverty programs at home. Billions in federal support for projects like the $16 billion Hudson Tunnel Project between New York and New Jersey and a $2 billion expansion of Chicago’s elevated rail system have been terminated, risking tens of thousands of American jobs. Clean energy projects have also been defunded, putting an estimated 50,000 jobs at risk, as detailed by NJToday News. These cuts have disproportionately affected Democratic-leaning states and are widely seen as political retribution.
At the same time, the expiration of the expanded Child Tax Credit, which had cut child poverty by nearly half in 2021, has led to a resurgence in child poverty: 13.4% of American children, or 9.7 million, were affected in 2024. The administration’s new budget excludes the poorest 19 million children from Child Tax Credit benefits and reduces food and health assistance, leaving the lowest-income families worse off. The 2017 Tax Cuts and Jobs Act, Trump’s signature legislative achievement, provided disproportionate benefits to higher-income households and corporations, while increasing federal debt.
All this has left many Americans questioning the administration’s priorities. While Argentina’s government gets a lifeline, American working families, seniors, and children face new hardships. The “America First” promise, critics say, is being overshadowed by international political alliances and ideological projects.
Back in Argentina, resistance to Milei’s policies continues. In the October 26, 2025 elections, the Workers Left Front – Unity (FITU) won three seats in the lower house and 9.1% of votes in Buenos Aires city, making it the third largest political force there. Yet, the broader challenge remains: how to build a movement that can break free from the constraints of established opposition and offer a genuine alternative to crisis-ridden Argentinian capitalism.
For now, both countries find themselves at a crossroads—Argentina, balancing on the edge of economic collapse and political upheaval; the United States, grappling with the consequences of its leaders’ choices at home and abroad. The story is far from over, and the next act promises to be just as unpredictable as the last.
