The Trump administration has unveiled plans to provide up to $40 billion in financial support to Argentina, marking one of the most significant U.S. economic interventions in a foreign nation in decades. The assistance comes as Argentine President Javier Milei faces mounting economic pressures and crucial midterm elections on October 26, 2025.

Treasury Secretary Scott Bessent announced on October 15 that the U.S. is working on an additional $20 billion facility that would complement the $20 billion currency swap line already pledged to Argentina earlier this month. The new funding would be structured as “a private-sector solution to Argentina’s upcoming debt payments,” according to Bessent, who indicated that numerous banks and sovereign wealth funds have expressed interest in participating.

The initial $20 billion commitment is a currency swap agreement with Argentina’s central bank, effectively allowing the country to exchange pesos for U.S. dollars to stabilize its faltering currency. This marks the first large-scale financial rescue directly financed by the United States since the Clinton administration provided Mexico with a $20 billion loan in 1995.

The U.S. Treasury is utilizing the Exchange Stabilization Fund (ESF) to finance the rescue package. The ESF, established in 1934 as a reserve to stabilize the U.S. dollar, holds approximately $43 billion in immediately available funds. Bessent confirmed that the support would be backed by International Monetary Fund Special Drawing Rights (SDR) assets held within the ESF, which would be converted into dollars.​

The Treasury has also been directly purchasing Argentine pesos in the open market since October 9 to defend the currency’s value, with Bessent confirming these purchases were continuing as of October 15.

The U.S. financial assistance is explicitly tied to political outcomes in Argentina. During a White House meeting with Milei on October 14, President Trump stated that continued U.S. support depends on Milei’s party succeeding in the October 26 midterm elections. “If he loses, we are not going to be generous with Argentina,” Trump declared.​

The midterm elections will determine half the seats in Argentina’s Chamber of Deputies (127 seats) and one-third of the Senate (24 seats). Milei’s La Libertad Avanza party currently controls only 37 of 257 seats in the lower chamber and 6 of 72 in the Senate, forcing him to rely on coalitions and executive orders to advance his reform agenda.​

Treasury Secretary Bessent later clarified Trump’s comments, stating that U.S. support is “policy-specific” rather than “election-specific,” explaining that Argentina will receive support “as long as Argentina continues enacting good policy.” A victory for Milei would mean maintaining enough legislative seats to block opposition attempts to override his vetoes, which requires approximately one-third of votes in both congressional chambers.

The bailout has sparked significant controversy in Washington, drawing criticism from both Democrats and some Republicans. Senator Elizabeth Warren (D-Mass.) attempted to advance the “No Argentina Bailout Act” to prevent the Treasury from using ESF funds for Argentina, but Senator Tim Scott (R-S.C.) blocked the legislation, calling it “unnecessary” and advocating for U.S. support of “an important ally in South America.”

Warren criticized the move as misplaced priorities, stating, “For Trump, the leader of Argentina is more important than American families struggling with rising costs for health care.” She also highlighted that Argentina recently made deals to sell soybeans to China, undercutting American farmers already hurt by tariffs.​

Representative Marjorie Taylor Greene (R-Ga.), typically a strong Trump ally, sharply rebuked the administration, posting on social media: “Americans are being crushed by soaring living expenses and rapidly increasing insurance rates. Many have no savings, and some are relying on credit cards just to get by. Explain to me how it aligns with America First to bail out a foreign nation with $20 billion or even $40 BILLION of taxpayer funds.”

Republican Senators Josh Hawley (R-Mo.) and Rand Paul (R-Ky.) also expressed skepticism. Hawley stated, “My intuitive response to bailouts in general, whether talking about bank executives or foreign countries, is to be very skeptical.” Paul declared, “I am against bailing out any countries. We have a significant debt issue in our nation.”

Agricultural state senators including Chuck Grassley (R-Iowa) and Kevin Cramer (R-N.D.) raised concerns about supporting a country that subsequently sold crops to China, disadvantaging American farmers.

Analysts have raised significant concerns about Argentina’s ability to repay the assistance. Since 2000, Argentina has defaulted on sovereign debt three times—in 2001, 2014, and 2020. The country currently owes nearly half of the IMF’s non-concessional lending globally, with all Argentine sovereign bonds rated as junk by credit rating agencies.​

In April 2025, the IMF approved a separate 48-month Extended Fund Facility arrangement for Argentina totaling $20 billion, with an immediate disbursement of $12 billion. The World Bank and Inter-American Development Bank followed with another $22 billion in financing. Combined with the new U.S. assistance, Argentina has secured extraordinary levels of international support.

The Trump administration has framed the intervention in geopolitical terms. Bessent described the assistance as aimed at preventing Latin American countries from moving leftward, stating, “We’re having to intervene militarily with the narco traffic coming out of Venezuela. Much better to use the heft of the U.S. economic power, rather than have to use military power.”

Milei has emerged as a key U.S. ally in the region, attending Trump’s January 2025 inauguration and maintaining close ties with the administration.

Senator Patty Murray and other lawmakers have stated that Trump’s bailout for Argentina “would fund at least a year of ACA tax credits millions rely on to afford health care” in the U.S.

The Commonwealth Fund estimates that federal funding for marketplace premium tax credits will decline by $31 billion in 2026 if the enhanced subsidies expire. The Argentina bailout would cover this decline with $9 billion to spare.​

The CBO projects that permanently extending enhanced premium tax credits from 2026-2035 would cost $349.8 billion over ten years, averaging about $35 billion annually. The $40 billion Argentina package would cover approximately 1.14 years of subsidies at this average rate.