Trump-pledged Support For Argentina Stirs Anger Among Republicans

President Donald Trump’s potential $20 billion financial backstop for his ally, Argentina’s leader Javier Milei, is running into growing opposition from Democrats, Republicans and farm groups over concerns the deal would hurt farmers and use U.S. taxpayer resources to backstop a flailing foreign economy at U.S. taxpayers' expense.

Trump and Treasury Secretary Scott Bessent earlier this week pledged a major economic rescue package for Argentina. Bessent, who has been touting the plans on social media and TV appearances in recent days, says the deal is needed to stabilize the nation’s financial turmoil ahead of October midterm elections that are critical to Milei retaining power and continuing reforms that supporters say will turn around the country’s floundering economy.

But the economic lifeline to a foreign country — one which has struggled for decades to pay its international creditors and rein in government spending — also carries some political and financial risks for the White House. Democrats have already seized on the opening to criticize a foreign bailout at U.S. taxpayer expense.

And powerful agriculture groups and their Republican allies in Congress are also sounding alarms about the deal.

“Why would USA help bail out Argentina while they take American soybean producers’ biggest market??? We shld use leverage at every turn to help hurting farm economy Family farmers shld be top of mind in negotiations by representatives of USA,” Sen. Chuck Grassley (R-Iowa) said on X Thursday.

Grassley said farmers were “very upset” about Argentina “selling soybeans to China right after USA bail out.”

The American Soybean Association said Argentina, a major agricultural producer, sold 20 shiploads of soybeans to China around the same time Bessent announced the U.S. was exploring a financial package. The transaction was eased by Buenos Aires waiving taxes on its soybean exports. China has turned to other major soybean exporters, such as Argentina and Brazil amid a trade war with the U.S.

The White House directed POLITICO to Trump's comments in the Oval Office on Thursday, where he said he'd use some of the windfall from tariffs to support U.S. farmers. The White House added that the administration believes an Argentine economic collapse would hurt U.S. farmers more by lowering the price of Argentine agricultural commodities. Treasury did not comment.

A person familiar with the discussions within the Trump administration about Argentina, indicated Milei’s star has dimmed in some corners in the administration. The person, who was granted anonymity to speak freely about the administration's evolving approach to Argentina, said this policy is being mainly pursued by Treasury and expressed concerns about Milei’s ability to actually lift his country out of its economic doldrums.

“Milei is done politically, his sister is corrupt, his finance minister is an insider trader, and they have pissed away $15 billion in IMF money and $15 billion in central bank reserves propping up a crap currency, and now Treasury wants American taxpayers to double down on stupid,” the person said. The person added that Milei “was a fraud. Came in, betrayed all the conservatives and libertarians that supported him … it’s all a wash.”

The fast-moving deal to help Milei, which is still being negotiated, underscores the extent to which the Trump administration is willing to go to help a political ally who has cultivated strong ties with the president and American conservatives in recent years. Bessent on Wednesday praised Milei “for his tireless efforts to Make Argentina Great Again” at an award dinner honoring the Argentine leader on the sidelines of the United Nations General Assembly in New York.

Bessent, who is the driving force behind the aid package, has explicitly said the financing is meant to shore up support for Milei ahead of a contentious election. Milei’s party got walloped in consequential local elections earlier in September, and his political movement is expected to face a similar electoral battering in legislative elections later this year as Argentines decry rising poverty as a result of Milei’s austerity policies and corruption within Milei’s government.

The economic lifeline for Argentina would be an unusual maneuver for the U.S., particularly for an administration that has eschewed large foreign interventions. Bessent said he was prepared to use Treasury’s Exchange Stabilization Fund to support Argentina through a purchase of the country’s debt or currency. The fund hasn’t been used in that way since at least the 1990s when President Bill Clinton’s administration approved a loan to prop up a cratering Mexican economy.

Proponents of the deal are selling it as a way for Trump to counter China’s growing influence in Latin America.

“This is a huge American First project,” said Barry Bennett, a former Trump campaign adviser whose lobbying firm does work in Argentina. “We need lithium, uranium, and they've got energy to boot. American companies are going to do extremely well in Argentina.”

“If the US is serious about countering China, this is exactly the way to do it” Bennett said. “Use the markets, use our tools, use our expertise, and we just forced China out of the country,”

Milei has long been seen as one of the best opportunities for Washington to improve its ties with Buenos Aires, which suffered under the successive left-leaning governments of Nestor Kirchner and his wife, Cristina Fernández de Kirchner. Their governments, buoyed by high commodity prices in the early 2000s, flouted obligations to international creditors, increased social welfare and pursued closer relations with Russia, China and other U.S. adversaries. Those moves made their Peronist political movement popular with voters, though worsened Buenos Aires’ decadeslong debt woes when commodity prices fell and the Argentine government found itself unable to sustain the high cost of the country’s social safety net.

In 2023, the Biden administration and lawmakers sympathetic to Milei, who ran on a platform of embracing the United States and pursuing massive cuts to government bureaucracy and bloat, worked to give his then-fledgling government more time to settle debt obligations with the IMF and other creditors. Milei then embraced Trump, endorsing him and increasing his overt outreach to Trump’s inner circle.

Despite “yellow flags” flashing, some analysts say the risks for a one-time investment in Milei’s economic project could be worth the potential reward.

“We've seen this movie in some ways before,” said Eric Farnsworth, who served in a variety of roles at the State Department, White House and the Office of the U.S. Trade Representative. “And the question is, is it different this time? And that's what the administration is not just gambling on, but trying to make sure it is different this time.”