The Trump administration is talking about using $40 billion to bail out a foreign country: Argentina.
So why is Trump abandoning his so-called “America First” stance to help a foreign leader? And who exactly is Argentina’s president Javier Milei, whose nickname is the “madman”, who calls himself an “anarcho-capitalist”, and who was the inspiration for Elon Musk’s federal cuts — and chainsaw stunts.
This is a story that involves election meddling, brutal anti-worker austerity, economic crisis, corrupt corporate payouts, and, of course, crypto scams.
Trump has bet a lot on Milei. The right-wing Argentine president is one of Trump’s closest allies on Earth. They have a lot of similarities. Like Trump, Milei won the election by cynically portraying himself as a “populist”, even though he chose the rich banker Luis Caputo to serve as his powerful finance minister, after he made a fortune trading stocks for the Wall Street mega-bank JPMorgan.
Trump and Milei have also both carried out similar corrupt schemes. Like the US president with his shady Trump coin, Milei scandalously promoted a meme coin rug pull that caused his own supporters to lose billions of dollars, in what became the biggest ever crypto theft.
Milei is likewise very close to the world’s richest man, the centibillionaire Elon Musk. In fact, Milei inspired Musk to launch his failed Department of Government Efficiency, or DOGE. And when Trump signed an executive order vowing to dismantle the Department of Education, he was echoing Milei.
It’s important to note as well that Elon Musk has a vested economic interest in Argentina. The electric cars made by his company Tesla need lots of lithium for their batteries, and Argentina just so happens to have some of the largest lithium reserves on Earth.
So what exactly is happening in Argentina, and why does Milei need to be bailed out?
This crisis actually goes back to 2018, when the first Trump administration pressured the International Monetary Fund, the IMF, to give the biggest loan in its history, a staggering $57 billion, to the conservative president of Argentina at the time, Mauricio Macri, who was a wealthy former business partner and personal friend of Donald Trump.
The goal of this previous bailout was to stabilize Argentina’s economy and reduce inflation in the lead-up to the 2019 election, which Trump wanted Macri to win. But the IMF loan instead provided the dollars needed to fund capital flight. This meant that the wealthiest people in Argentina converted their pesos to dollars and stashed the money in offshore accounts, while the poor in Argentina got even poorer.
Argentine President Mauricio Macri (right) with US President Donald Trump in Buenos Aires in 2018
Now, despite Trump’s meddling, his friend Macri was very unpopular, and he lost the 2019 election. But the new administration that followed was left with an enormous, unpayable debt owed to the IMF, and then, the pandemic hit, causing an economic crisis.
This is where Javier Milei came in. He exploited that economic crisis and won the next election on a false promise to solve all of Argentina’s economic problems by simply gutting government spending. Mere hours after he assumed the presidency of Argentina, Milei abolished over half of the government’s ministries, including the ministries of education, transportation, environment, employment and social security, science and technology, and many more.
He laid off huge numbers of government workers, slashed public sector salaries and benefits, cut pensions, and privatized state-owned enterprises. When workers and elderly retirees protested in the street, the libertarian president dispatched the police to violently repress them.
All of this resulted in rampant poverty and hunger. Official government statistics published in 2024 found that 53% of Argentina’s population was living in poverty, including 66% of children under age 14.
That national poverty rate grew by 11 percentage points in the first six months of Milei’s term, making it the largest increase in poverty in 20 years.
In 2025, Milei’s government published new figures claiming that poverty had fallen, but the accuracy of the data was called into question and accused of being politically motivated. Independent experts at a prestigious university, the Pontifical Catholic University of Argentina, said the government’s 2025 data was highly dubious and likely exaggerated.
A poll published in early October found that nearly two-thirds of Argentines, 64.2% of the population, do not believe that the poverty rate has truly fallen under Milei.
A key reason for this is that the purchasing power of Argentine workers has collapsed under Milei.
Real wages plummeted immediately after Milei won the October 2023 election. This was because Milei had promised to abandon Argentina’s currency, the peso, and to instead adopt the US dollar. Milei then devalued the peso, crushing the purchasing power of average Argentine workers, and causing inflation to rise much faster than wages. Real wages have slightly risen since then, but they are still only a fraction of what they were before Milei won.
Meanwhile, under Milei, Argentina has become the most expensive country in Latin America.
The costs of many basic foods, especially meat, have become prohibitively high for working-class Argentines. 28% of people are now suffering from food insecurity. The levels of hunger are at their highest level in decades.
Despite the growing hunger, Milei insisted that the government should not intervene and provide food, because, according to his libertarian worldview, people will simply work harder so they don’t die of hunger.
However, the Western financial press was busy heaping praise on Milei, claiming that he oversaw an “economic miracle” because he reduced the government deficit, while the stock market was soaring.
Rich investors were getting even richer. But the vast majority of Argentine workers did not benefit from the new record highs in the stock market. They were struggling to put food on the table.
Meanwhile, today, Argentina is facing not just one, but multiple crises. The country has suffered from some of the highest rates of inflation on Earth, and its currency, the peso, has fallen rapidly against the US dollar.
Moreover, the bond market has been in crisis, with foreign investors selling off Argentine government debt. Milei’s victory in the 2023 election had also led to the inflation of a massive bubble in the Argentine stock market, and that has burst as well. It has been in free fall for all of 2025.
So the Trump administration is stepping in not only to save Milei, but also to bail out rich American elites who invested in risky stocks and bonds in Argentina, to make sure they don’t lose their investments – all while the Trump administration cuts Medicaid and food stamps at home.
US Treasury Secretary Scott Bessent, a billionaire and former hedge fund manager, revealed that the US plans to give $20 billion in a swap line to Argentina’s central bank, so it has the dollars it needs to pay the debt it owes to wealthy bondholders.
The Trump administration later announced that it would facilitate an additional $20 billion bailout from private lenders, totaling $40 billion in assistance for Argentina.
Bessent also proposed that the US government could buy Argentine pesos, which would help prevent the currency from falling further.
Moreover, Bessent said the Treasury is willing to directly purchase Argentine bonds. This means that the US government will be lending money to the Milei administration, by directly purchasing Argentine government debt. By doing so, Washington can help Buenos Aires reduce its borrowing costs.
Bessent even revealed that the Trump administration is pressuring US companies to “make substantial foreign direct investments” in Argentina, “in the event of a positive election outcome”.
In other words, Bessent admitted that the US government is meddling in Argentina’s elections, which are coming up on 26 October. Why? Well, the Trump administration is afraid Milei and his right-wing allies could lose.
The Argentine capital Buenos Aires already held local elections in early September, and Milei’s right-wing party, which is called “Liberty Advances”, was crushed. Voters overwhelmingly rejected his anti-worker, pro-billionaire agenda.
The fact of the matter is that Milei is very unpopular. A poll published in early October found that 65% of people in Argentina oppose Milei’s government. Only 35% of the population supports his libertarian policies.
The same poll found that the majority of Argentines oppose Milei’s close alliance with Donald Trump. Nearly two-thirds, 64.6%, said that Milei’s trip to the United States in September will not bring real investment to Argentina, and that it was merely a symbolic political act.
A clear three-fifths of people in Argentina, 59.7%, also think that the country will not be able to pay the massive debts that Milei and his right-wing predecessors have taken on from the IMF and the US.
It’s very easy to explain why Milei is so unpopular. His policies benefit rich elites and hurt the vast majority of working-class Argentines.
Milei has also shown himself to be corrupt — and not just when he promoted a crypto meme coin scam that caused his own supporters to lose a fortune.
Milei has recently faced several other serious corruption scandals.
The day he came to power, Javier Milei repealed a law banning nepotism, so he could appoint his sister Karina as his chief of staff. Karina had no political experience. She was a tarot card reader who sold cakes on Instagram. But, like Javier, she is an avowed right-wing libertarian, and she has become one of the most powerful people in his government.
However, Karina Milei has been exposed for corruption. In August, a recording was leaked in which a member of Milei’s legal team discussed how a private pharmaceutical company was paying bribes to officials in the Milei administration, including his sister Karina, who was accused of stealing half a million dollars per month from Argentina’s National Disability Agency, by channeling it through the pharmaceutical corporation.
This scandal caused widespread outrage in Argentina, only adding to the country’s existing economic problems.
But that’s not all. Javier Milei set off another scandal in early October when it was revealed that, mere days after the Trump administration announced its bailout, the libertarian president signed an executive order that gives the US military access to multiple bases in Argentina, and allows the US Department of War to carry out military exercises in Argentine territory. Moreover, Milei rammed through this measure without approval from Congress, in blatant violation of the constitution.
People in Argentina were furious. Local politicians accused Milei of “surrendering our sovereignty” and handing over Argentine territory to the US military access as “a bargaining chip for his electoral purposes”.
Now, as if that weren’t already enough, more scandals struck in October, immediately after the Trump administration announced its bailout.
Milei faced lawsuits after he admitted in a TV interview that he meddled in Argentina’s judicial system, which is supposed to be independent and apolitical. Yet Milei boasted that he “took the decision” to imprison left-wing former President Cristina Fernández de Kirchner, his main political rival, on unsubstantiated, politically motivated charges of “corruption”.
Then, the same week, one of Milei’s most important political allies, the staunch libertarian lawmaker José Luis Espert, admitted that he had been given $200,000 by a notorious drug trafficker. Espert was literally at the top of the list of candidates from Milei’s “Liberty Advances” party, but he was forced to resign in disgrace, just weeks before the legislative elections.
Milei was already very unpopular in Argentina, yet these constant corruption scandals have only further outraged the country.
But the Trump administration is trying its best to help Milei. And that’s the real reason you’re hearing about this $20 billion bailout right now. But it’s probably not going to work:
It’s likely that Milei and his “Liberty Advances” party will lose the October elections.
And while the bailout could temporarily help the Argentine economy, it won’t permanently fix their crisis.
What’s also ironic is that Trump’s bailout of Argentina is hurting US soybean farmers, many of whom voted for him.
Meanwhile, journalist Judd Legum pointed out that one of the biggest benefactors of the Trump administration’s bailout is an American hedge fund billionaire named Robert “Rob” Citrone who has bet big on the Argentine economy. He also just so happens to be friends with Scott Bessent.
Citrone is also an important ally of Milei, and the Argentine president’s office has posted photos of him with the US billionaire oligarch on its official website.
Once again, Donald Trump is putting the interests of wealthy investors above those of workers.
So in short, those are the real reasons why the Trump administration is handing out $40 billion to the government of Argentina, while cutting social spending at home.
This video report was co-published with More Perfect Union in two parts.
