In a dramatic twist that has rocked Argentina's already turbulent political landscape, the United States intervened directly in the country’s financial crisis just days before the pivotal October 26, 2025 midterm elections. The move, which saw the Trump administration orchestrate a $20 billion currency swap and even purchase Argentine pesos outright—a rarity in international finance—has injected both hope and confusion into President Javier Milei’s embattled administration.
According to NSJ Online, U.S. Treasury Secretary Scott Bessent confirmed last Thursday that after four days of intense negotiations in Washington, D.C. with Argentine Economy Minister Luis ‘Toto’ Caputo, the two countries finalized a $20 billion swap line. Bessent declared on social media, “U.S. Treasury is prepared, immediately, to take whatever exceptional measures are warranted to provide stability to markets.” The deal also includes the possibility of another $20 billion in public and private debt financing and direct purchases of Argentine assets on the open market.
President Milei, a self-proclaimed libertarian and fervent admirer of Donald Trump, expressed deep gratitude for the American intervention. In a social media post, he thanked Bessent for his “strong support” and Trump for his “powerful leadership,” adding, “Together, as the closest of allies, we will make a hemisphere of economic freedom and prosperity.” Economy Minister Caputo echoed the sentiment, writing, “Your steadfast commitment has been remarkable.”
Yet, the American rescue has not come without strings—or at least, not without confusion. Trump’s public remarks quickly muddied the waters, as he appeared to tie continued U.S. support to the outcome of Argentina’s upcoming midterm elections. “If he loses, we are not going to be generous with Argentina… if he wins, we are staying with him, and if he doesn’t win we are out,” Trump said, according to Buenos Aires Times. The ambiguity left many in Argentina and abroad wondering whether U.S. backing would truly last until 2027, as Milei later insisted, or if it hinged on the results of the October 26 vote.
The timing of the intervention could not be more critical. Argentina’s economy has been battered by a run on the peso, rapidly depleting foreign exchange reserves, and persistent political instability. The country owes the International Monetary Fund a staggering $41.8 billion, and Milei’s radical austerity program—designed to slash public spending—has so far failed to spark an economic revival. Inflation, once spiraling at over 200 percent, has dropped to a projected 27 percent by the end of 2025, and poverty rates have fallen, but the pain of adjustment has been severe. As The Atlantic reports, “Since you took office, 26 companies have been closing every day. Eighty percent of people can’t make it to the end of the month. Do you take that into account?” journalist Eduardo Feinmann recently asked Milei on A24. The president’s response: “The worst has passed.”
But patience is wearing thin. The October midterms are widely seen as a referendum on Milei’s free-market experiment. His La Libertad Avanza (LLA) party, which swept into power on a wave of anti-establishment anger, now controls just 37 of 257 seats in the Chamber of Deputies and 6 of 72 in the Senate. To pass his ambitious reform agenda, Milei has been forced to reach out to former adversaries, including ex-president Mauricio Macri and members of the traditional “political caste” he once derided. His administration now includes figures like Guillermo Francos, Patricia Bullrich, and Daniel Scioli—all veterans of previous Peronist or centrist governments.
Opinion polls suggest a technical tie between Milei’s LLA and the pan-Peronist Fuerza Patria, each commanding about a third of the electorate. Another 10 percent could go to provincial parties and the new coalition Provincias Unidas, with smaller parties, leftists, and undecided voters splitting the rest. Voter turnout has been historically low in 2025’s local elections, and the introduction of a new “single ballot” system nationwide adds another layer of unpredictability.
For Milei, success in the midterms means more than just survival—it’s about retaining enough seats to defend his veto power and build “circumstantial majorities” with remnants of the Juntos por el Cambio coalition. Without this, his vision for sweeping economic reform could be dead in the water. As The Atlantic notes, “Politics, not economics, dictates the pace of change.”
Yet, even as he courts political allies, Milei faces fierce internal battles. The role of political consultant Santiago Caputo—once hailed as the architect of Milei’s 2023 election victory—has become a flashpoint. Caputo, who has no formal appointment but wields significant behind-the-scenes influence, has clashed with Milei’s sister and chief of staff, Karina Milei, and other key lieutenants. The infighting has spilled into public view, further complicating Milei’s efforts to project unity and competence.
Corruption scandals have added to the administration’s woes. Milei continues to defend José Luis Espert, his former headline candidate in Buenos Aires Province, despite “convincing accusations of dealings with an accused drug-trafficker,” and has failed to adequately address the so-called “$LIBRA” cryptocurrency scandal or allegations of kickbacks involving his sister. According to The Atlantic, these scandals have led voters to see Milei’s “revolution” as increasingly indistinguishable from the politics-as-usual he once railed against.
Meanwhile, U.S. support for Argentina has come under fire at home. American farmers, already reeling from competition with Argentine soybean exports to China, have criticized the bailout. Democratic lawmakers, led by Senator Elizabeth Warren, introduced the “No Argentina Bailout Act” to prevent the Treasury from using its Exchange Stabilization Fund for Argentina. “It is inexplicable that President Trump is propping up a foreign government, while he shuts down our own,” Warren said in a statement. The controversy has forced the Trump administration to insist that the credit swap is not a bailout, even as critics argue it amounts to a preelection reward for a loyal friend.
All of this unfolds against the backdrop of Argentina’s long, tumultuous history with Peronism—a political movement that has dominated the country for decades, from the populist policies of Juan Domingo Perón to the progressive Kirchnerism of Cristina Fernández de Kirchner. Milei’s rise was fueled by public exhaustion with this status quo. But as the midterms approach, Peronism is showing signs of resurgence, particularly in Buenos Aires Province, where Governor Axel Kicillof orchestrated a crushing defeat for Milei’s coalition in recent local elections. Kicillof declared, “The ballot boxes shouted that you can’t defund health care, education, universities, science, or culture in Argentina.”
In the end, the outcome of the October 26 midterms will determine not just the fate of Milei’s presidency, but also the trajectory of Argentina’s experiment with radical free-market reform. The U.S. intervention has provided a financial lifeline, but whether it’s enough to steady the political ship—or simply prolong the country’s cycle of crisis—remains to be seen. For now, all eyes are on Buenos Aires, where the battle for Argentina’s future is about to reach its fever pitch.
