In a dramatic display of transcontinental political theater, United States President Donald Trump has tied a massive $20 billion economic lifeline for Argentina directly to the political fortunes of the country’s right-wing leader, Javier Milei. The move, which has sent ripples through both hemispheres, comes just weeks before Argentina’s crucial legislative elections on October 26, 2025—a contest that could determine whether Milei’s coalition, La Libertad Avanza (Freedom Advances), retains the power needed to continue his sweeping economic reforms.
Trump’s message was unequivocal. During a high-profile meeting at the White House on October 14, he told reporters, “If President [Milei] does not win, and I think I know who will compete against him and it will be a person from the extreme left, we will not be as generous with Argentina as has been the case up to now.” According to El País, he went even further, warning, “If they don’t do that, we’re not going to be around very long.” The implication: the $20 billion bailout, structured as a currency swap to stabilize Argentina’s battered peso, hinges on Milei’s party prevailing at the polls.
This conditional approach to international aid is as bold as it is controversial. Trump’s administration, through Treasury Secretary Scott Bessent, orchestrated a highly unusual intervention in Argentina’s currency market after Milei’s party suffered a landslide loss in Buenos Aires Province in September. The defeat, coupled with mounting corruption scandals and surging unemployment, triggered a crisis of confidence. Investors dumped Argentine bonds and the peso, forcing the country’s Treasury to burn through more than $2 billion in reserves in a desperate bid to keep the currency afloat—a move that risked exhausting even the funds received from the International Monetary Fund (IMF) just months earlier.
With Argentina’s economy teetering on the edge, Milei flew to Washington, seeking support. The meeting with Trump was more than a diplomatic formality—it was a lifeline. As AP reported, Milei arrived with two clear objectives: to negotiate US tariff exemptions for Argentine goods and to secure the $20 billion swap line that could replenish Argentina’s depleted reserves ahead of the midterms. The Trump administration responded with a direct promise: the US would allow Argentina to exchange up to $20 billion worth of pesos for dollars, a move Bessent described as “of systemic importance.”
But the rescue comes with strings attached. Trump’s public endorsement of Milei—“You’re going to win the election. We’re going to endorse you. I’m going to endorse you today, fully endorse you. People in Argentina like me. A lot of people like me,” he declared, according to Al Jazeera—was paired with a stark warning that a return to left-wing rule would end US generosity. “We would not be generous with Argentina if that happened. If he loses, we are not going to be generous with Argentina,” Trump said, underscoring the political nature of the aid.
The stakes for Argentina are enormous. Milei, a self-described anarcho-capitalist who took office in December 2023, has slashed inflation from its previous 200 percent peak but at a heavy cost. His austerity measures, including dramatic cuts to social programs, have drawn fierce backlash. In September, his coalition was trounced in Buenos Aires Province by the left-wing Justicialist Party, which secured over 46 percent of the vote to La Libertad Avanza’s 34 percent. The defeat was compounded by a scandal involving Milei’s sister, Karina Milei, who was accused of accepting kickbacks in exchange for government contracts—a charge both siblings have denied.
The political fallout has been swift. Argentina’s Congress has repeatedly overturned Milei’s vetoes, restoring funding for people with disabilities, universities, and pediatric healthcare by overwhelming majorities. The legislative pushback, coupled with Milei’s declining popularity, has left his government scrambling to maintain control ahead of the midterms. As political analyst Marcelo J. García told AP, “The government is trying to win some time to make it to the midterms without major course corrections, like devaluing or floating the peso.”
For Trump, the calculus is both ideological and geopolitical. He sees Milei as a key ally in Latin America, a bulwark against China’s growing influence in the region. Secretary of State Marco Rubio, present at the White House meeting, placed Argentina alongside Costa Rica and El Salvador as crucial partners in the US’s regional strategy. Trump even joked about sending “Tomahawks” to help Milei combat his opposition, drawing polite laughter but underscoring the seriousness with which he views the alliance.
Yet, the conditional nature of the aid has not gone unnoticed—or uncriticized—back home. US Representative Maxine Waters lambasted Trump for prioritizing a foreign bailout over resolving the ongoing US government shutdown, accusing him of “putting his political allies over the welfare of the American people.” The optics of bailing out a country with a history of serial defaults in the midst of domestic fiscal turmoil have raised eyebrows among economists and lawmakers alike.
Despite the lifeline, questions loom over Argentina’s ability to repay the US. The $20 billion swap comes on top of IMF loans totaling $54 billion, and Milei’s government has already missed early IMF targets for rebuilding reserves. As Brad Setser, a former US Treasury official, told AP, “I worry that this may prove to just be a short-term bridge and won’t leave Argentina better equipped to tackle its problems.”
Meanwhile, Trump and his officials remain bullish on Milei’s prospects. “We think he’s going to do quite well and then continue his reform agenda,” Bessent told reporters, reiterating that US aid is “predicated on robust policies.” Trump, for his part, defended Milei’s controversial reforms, arguing, “Argentina would be lost if he wasn’t there.” He blamed negative press coverage for Milei’s woes, saying, “He’s got one problem. He’s got people that are giving him tremendously bad press. Everybody knows he’s doing the right thing. But you have a radical-left sick culture that’s a very dangerous group of people, and they’re trying to make him look bad.”
The October 26 midterms will determine not only the fate of Milei’s coalition but also the future of Argentina’s economic relationship with the US. With half the seats in the Chamber of Deputies and a third in the Senate up for grabs, control of Congress will decide whether Milei can continue his cost-cutting campaign—or whether the country will pivot back toward the left-wing policies Trump has so forcefully denounced.
As Argentina stands at a crossroads, the world watches to see whether Trump’s high-stakes gamble will pay off—or whether the nation’s economic and political turmoil will deepen in the wake of such conditional support.