Trump Admits $20 Billion U.S. Aid to Argentina Aims to Boost Milei Before Elections
President Donald Trump has openly acknowledged that a $20 billion U.S. financial lifeline offered to Argentina is designed to strengthen President Javier Milei’s chances in the upcoming legislative elections. His comments have stirred debate over Washington’s role in influencing political outcomes abroad.
Speaking from the White House, Trump welcomed Argentina’s libertarian leader, calling him a “bold reformer” and praising his free-market agenda. But his remarks quickly turned political. Trump made it clear that U.S. assistance to Argentina is directly tied to Milei’s success at the polls later this month.
“The election is coming up very soon — a very big election,” Trump said, seated across from Milei on Tuesday. “Victory for Javier is very important. I hear his poll numbers are good — and I think they’ll be even better after this. If he loses, we are not going to be generous with Argentina.”
The October 26 midterm elections are seen as a major test for Milei’s controversial cost-cutting reforms, which have polarized Argentines. While his supporters applaud his aggressive moves to slash spending and liberalize the economy, critics argue his austerity agenda is deepening poverty and inequality.
Washington’s Strategic Bet
The $20 billion currency support program, structured as a swap line between the U.S. and Argentine central banks, was announced as a measure to stabilize Argentina’s rapidly depreciating peso. But Trump’s blunt admission suggests the move is also a political gamble meant to keep Milei’s pro-U.S. government in power.
Trump was unusually frank in linking foreign aid to electoral outcomes — an approach that analysts say marks a shift in U.S. diplomacy.
“If a socialist wins, we’ll feel a lot differently about helping Argentina,” Trump added. “We’re not going to waste our time.”
For his part, Milei thanked Trump for his support, blaming Argentina’s financial chaos on what he called “sabotage by political opponents.”
“This liquidity problem is the result of the political attacks we have suffered,” Milei told reporters. “President Trump’s help shows who truly wants prosperity for Argentina.”
Economic Crisis and Political Pressure
Argentina’s economy has been in free fall for years, plagued by triple-digit inflation, shrinking foreign reserves, and recurring debt crises. Milei, who took office in December 2023, promised to reverse decades of mismanagement with radical reforms inspired by Margaret Thatcher and libertarian economics.
However, the president’s efforts have come at a steep cost. His austerity policies — including deep cuts to pensions, education, healthcare, and energy subsidies — have sparked protests and eroded public trust. While inflation has cooled somewhat, unemployment and poverty have risen.
Recent polls suggest Milei’s La Libertad Avanza (Freedom Advances) coalition is struggling to maintain momentum. Poor results in Buenos Aires provincial elections earlier this month rattled investors and fueled speculation about the sustainability of his economic program.
The Argentine peso, already weakened by years of instability, tumbled further after Trump’s press conference. Markets appeared skeptical that political backing from Washington would be enough to restore confidence in the currency.
Aid or Election Interference?
Critics have accused Trump of meddling in Argentina’s domestic politics, noting the irony given his previous denunciations of foreign interference in U.S. elections. Linking financial support to the outcome of another nation’s vote, they argue, blurs the line between diplomacy and manipulation.
Still, Trump’s aides defended the move, describing it as a pragmatic effort to safeguard regional economic stability.
A senior U.S. official said the $20 billion package aims to “prevent a full-scale financial collapse in Argentina that could destabilize South America.” Yet Trump’s public comments undercut that message by framing the aid as contingent on Milei’s victory.
Economists, meanwhile, warn that politicizing economic support could undermine its intended impact. The peso’s continued slide and the drop in Argentine stocks on Tuesday underscored market unease.
“This intervention, which should have stabilized Argentina’s economy, now looks politically conditional,” said Paul Triolo, a Latin America analyst at Albright Stonebridge. “Financial markets hate uncertainty, and Trump just introduced a lot more of it.”
Milei’s Uphill Battle
Even with Washington’s backing, Milei faces enormous challenges at home. His government lacks a congressional majority, limiting his ability to pass key legislation. Several of his executive decrees have already been overturned by opposition lawmakers.
In addition, a series of corruption scandals within Milei’s party have tarnished its anti-establishment image. Analysts say losing seats in the midterms could paralyze his reform agenda, potentially derailing Argentina’s path toward economic stabilization.
Milei’s critics say Trump’s public show of support might backfire, reinforcing perceptions that the Argentine president is too closely aligned with U.S. interests. Opposition leaders have already seized on Trump’s comments as evidence that Milei is “trading sovereignty for political survival.”
Still, some economists believe the U.S. intervention might stave off a deeper crisis — at least temporarily. Argentina owes $20 billion in debt repayments next year, and its foreign reserves are dangerously low. Without the new dollar swap line, Milei risked a currency collapse or another sovereign default.
Letting the peso devalue sharply could have triggered soaring prices and social unrest — a scenario many economists warned would be “political suicide” for Milei. The U.S. funds, therefore, provide short-term breathing room, though at a potentially high political cost.
A Calculated Gamble
Whether Trump’s $20 billion lifeline will translate into electoral success for Milei remains uncertain. Ordinary Argentines continue to feel the pinch of rising costs and reduced government services, and many are skeptical that foreign aid will change their day-to-day struggles.
Supporters, however, credit Milei with tackling inflation and the fiscal deficit head-on — achievements they say previous governments failed to deliver. They view Trump’s endorsement as validation of Milei’s pro-market reforms and his efforts to “rebuild Argentina’s credibility.”
But if the U.S. aid fails to stabilize the economy or if Milei’s coalition loses ground, both leaders could face political fallout. For Trump, it would highlight the risks of tying foreign policy too closely to personal alliances. For Milei, it could expose his government’s dependence on U.S. backing — and deepen public frustration ahead of the next presidential election in 2027.
As Argentina braces for a pivotal vote, the world will be watching whether Washington’s gamble pays off — or whether it becomes another chapter in the country’s long struggle with crisis and recovery.