Why Is Trump Bailing Out Argentina’s Milei?

The vision of US President Donald Trump about how America has made great again more geographically, with the latest ideas for an ideological ally, about 5,000 miles away.

The Trump administration, through Treasury Secretary, Scott Payette, has placed the full belief and credit of the US government behind the besieged Argentina President, Javier Miley, whose radical economic reforms have succeeded only partially that face decisive elections in congress later this month. The United States and Argentina are in talks about the possibility of clicking up to $ 20 billion in emergency support to support Argentine peaso, buy Argentine bonds, and keep Milli in the office.

The vision of US President Donald Trump about how America has made great again more geographically, with the latest ideas for an ideological ally, about 5,000 miles away.

The Trump administration, through Treasury Secretary, Scott Payette, has placed full belief and credit of the US government behind the besieged Argentina President, Javier Miley, who only has radical economic reforms I worked partially And who faces elections in Congress later this month. The United States and Argentina in talks about Click the possibility Up to $ 20 billion in emergency support to support the Argentine peaso, buy Argentine bonds, and keep Milli in the office.

The question is why. Initially, Pisent said that the financial and financial problems of Argentina were from Regularity Attention to the United States, which, given the small trade and financial flows between the two, will not only Be right If Washington introduces the country $ 20 billion. Then it will be.

“I don’t think it is very important,” said Brad Cedar, a coworous colleague of the international economy in the Council of Foreign Relations and the former US Treasury official. “It is assumed that it meant Argentina is a model they believe in.”

How Argentina Facing a problem It is an old and familiar story, although only a millimeter’s mistake. Miley came to his position two years ago, pledged to reform all the damage caused by years of misleading Peronic policies, and was in some of the senses successful. It has almost reduced inflation from the superior to something annoying: the fact that the annual inflation is only It is considered 20 percent a victory According to Argentine standards.

But at the same time, much of the treatment of Miley shock was painful. Unemployment is creep Partially because the strongest bizo that Millie motivated to slaughter the inflation dragon made the economy less competitive. Recently, the Argentine Central Bank has spent money hardly to support the bizo Fears About the future of the country’s policy and economic options, making investors tense. The uterus was destroyed Electoral loss By the Miley party last month of Peroni candidate in the densely populated Buenos Aires County, suggestion Milli economic reforms can lead to disappointment to choose a return to performance.

As Nobel Economist Paul Crowagman also noted, the Argentina dilemma is not new. It is similar to the previous financial crises in Latin America, where an exaggerated currency leads to controlling inflation, leading to a lack of confidence. “Argentina suffers from a classic currency crisis, as the capital escapes from the country because investors are afraid of the collapse of the Biso, and this capital journey [is] The bizo is closer to collapse, “Crocman books In my country last week.

On the surface, the American rescue plan for Argentina has precedents. The United States came to save Mexico in 1995 during “Tikilaso“ The crisis in a similar way, Backstopping Peso sliding with US dollars. But Mexico, one of the neighbors and the last signature of the North American Free Trade Agreement, Really was Of the regular interests of the United States.

It is difficult to present this issue to Argentina – unless Crowgman and others, like Senator Elizabeth Warren, right and he is a purely politician. Millie was preferred for Trump even before his election, and his liberation views on how to reform the Economy of Argentina, while he was inconsistent with count Displayed in Washington, still strikes the right ropes.

Or as Pisent itself He said Last week, Millie presented the International Citizen Award for the Atlantic Council during the preparation of a US government-backed rescue plan: “One of the government men was the solution-the problem was.

The contrast between the Trump administration’s approach to Argentina and Brazil is an illustration. Brazil, one of the 10 largest economies in the world, has a president who tends to the left and a court system Prosecution Consputing coup. Both caused them in Trump, which first leads to 50 percent arbitrary Definitions On Brazilian exports and recently to the Ministry of Treasury Setting penalties Brazilian judges who apply their country’s laws.

It is not a Trump administration’s exit. Famous Vice President JD Vance rebuke The Europeans this year in Munich on “freedom of expression”, Trump and delegates have strengthened right -wing political formations in Europe, including the far -right alternative to Germany.

But there is still a paradox in the despair of Millie. Argentina is Elderly The borrower from the International Monetary Fund, with another $ 20 billion Involve this year. It raises the issue of how, if any, may be any American money ever Fill.

“If the following wants to be a liberal, he needs to rely on his own resources, yet the bizo is only sustainable for borrowed funds,” Citzer said.

Another paradox in the United States is accelerating to help Argentina. To win the hard currency, the Milli government recently suspended taxes on agricultural commodity exports: While tax revenues are required to balance books, real funds are needed to rebuild exhausted reserves. China immediately It has passed in He bought a lot of soy crop in Argentina. The losers were the American farmers, who have already seen the destroyed export markets – through Trump’s wars (although he pledged recently Surrendered To them with subsidies, again). Pesin recently said the end That tax vacation, and Argentine export, will be part of bilateral discussions.

But even the Life Blind in Washington may not be sufficient to provide the peaso, although the availability of the promised dollar has already calmed the Argentine markets a little. In a research note, Oxford’s economy said that the strong American financial support package may not be sufficient: “The installation may be out of reach if the markets expect a government defeat in the presidential elections for the year 2027.”

Unlike previous US financial interventions, this may be less than a bridge loan and more than a bridge anywhere.

“I doubt that this will even transfer Milli to the elections without reducing a forced value. If they use money, how do you get money?” Setzer said.