If you’ve heard this story before, you’re not alone. Argentina is particularly adept at leaping from crisis to crisis. A collapsing Argentine peso, desperate negotiations in Washington, and a high-profile U.S. rescue are all features once again.
But this time, with libertarian President Javier Milei at the helm, the script was supposed to change. He was meant to bring about the end to Argentina’s woes in a libertarian utopia that would slash government spending, central banks, and the country’s rampant inflation.
Instead, the news cycle is churning with déjà vu and growing skepticism about whether the U.S.’s latest multibillion-dollar backstop marks the beginning of Argentina’s monetary freedom, or the end of a libertarian experiment that never began in earnest. As Max Keiser simply put it:
“The U.S. should be buying Bitcoin with that money and Argentina should too.”
Bailouts, dollar diplomacy, and a shaken faith in Argentina
President Trump’s administration authorized a substantial U.S. financial package ($20 billion) to Argentina, specifically to prop up the reeling peso and calm local markets. The deal came against a backdrop of Milei’s dollarization promises, intensified capital flight, a rapidly deteriorating fiscal picture, and local faith in the peso hitting record lows.
For the U.S., this isn’t the first rodeo. The Trump administration’s “second bet” on Argentina follows a disastrous first-term rescue that ended with little reform and even less market confidence. As Bloomberg notes, the White House is betting on Milei’s outsider status to break the cycle, attacking what it views as decades of political malpractice in the region. The hope: bold reforms, market discipline, and a new era of dollar stability.
But look under the hood, and the picture isn’t so clear. Argentina’s latest bailout looks suspiciously familiar to previous rescue packages; a Band-Aid, not a cure.
For all of Milei’s anti-establishment rhetoric, the U.S. deal does not mark a clean break with the past. The negotiations have forced Argentina to retrace old steps: fast-track austerity at the cost of social pain, currency manipulation rather than real monetary reform, an