[programmertote]

What's the benefit for trump and co. helping out Argentina (other than helping a kindred spirit, the current Argentinian president)? I really can't see any benefit for the US in this move. Hopefully, someone more versed in economics can explain what the missing angle is, if any.

[nradov]

I'm not convinced this bailout is good policy but you could maybe make a case that it's the least bad option. If the USA doesn't help Argentina then the lender of last resort becomes China. Do we want China to gain more control and influence in the Americas?

https://sccei.fsi.stanford.edu/china-briefs/chinas-overseas-...

[estearum]

The US is not the global or continental lender of last resort. The IMF traditionally holds that role and it appears to be at its limit with regard to Argentina due to serial defaulting, political instability, corruption, and overall lack of credibility.

Not compelling at all to say the US just generally has an imperative to buy debt or lend to countries whenever they're least creditable just because China might do it anyway.

[thrance]

If your goal is to help the Argentinian people, you would let Milei's extremely destructive and incompetent government fail and fall. This bailout only gives "General AnCap" more time to sell the country's future.

[donavanm]

Its intervening to save a democratic and aligned country from yet-another economic collapse and political crises at their upcoming national elections. Not dissimilar to what the us did for mexico during the peso crisis and revaluation in the 90s.

I dont know why “bail out” is the headline term, it’s closer to a “currency backstop” AFAIK. The us is effectively extending hard dollars in exchange for pesos, allowing the argentine govt to not be destroyed in the open currency markets. If this works the peso would retain (or gain) value as the country recovers (economically, due to the ongoing reforms) and the us could feasibly even profit.

On the USD and peso backstop its important to note that “dollarization” was a big talking point for milei. But argentina never had anywhere close to enough USD reserves or even USD economic flows to make that at all feasible ever. Like many many billions away from plausible. So there was a background theme of trying to catch them out on that as well since the last elections.

Edit: and for context the current run against the peso is effectively because of dumb milei posturing ahead of regional elections, and a strong populist/peronist result. Lots of fear that if its repeated at the upcoming national elections then argentina goes back to kirchner style populism and debt/economic blow up.

[coliveira]

The only people who will benefit from this are the financial elite in Argentina who are selling pesos and getting dollars as quickly as they can, and the hedge funds who invested in Argentina and need a way out. The current government, which is a bad joke, will never win anything else. The economy will continue to go south because this plan doesn't work even in the short term.

[clipsy]

> I dont know why “bail out” is the headline term, it’s closer to a “currency backstop” AFAIK. The us is effectively extending hard dollars in exchange for pesos, allowing the argentine govt to not be destroyed in the open currency markets. If this works the peso would retain (or gain) value as the country recovers (economically, due to the ongoing reforms) and the us could feasibly even profit.

If.

[jordanb]

Argentina wouldn't be "destroyed" by a currency devaluation. But Milei wants to keep the Peso strong so his upper/middle class supporters can keep buying electronics and going on international vacations.. at least until the next election.

[estearum]

Scott Bessent is besties with Rob Citrone who is one of the largest purchasers of Argentine debt. He lobbied Bessent, Bessent said "Sure!"

Sometimes it really is that simple.

https://paulkrugman.substack.com/p/bailing-out-bessents-budd...

https://www.nytimes.com/2025/10/09/us/politics/argentina-bai...

https://www.motherjones.com/politics/2025/09/trump-argentina...

[martythemaniak]

Talking about the naked, open corruption and bribery is considered gauche in polite society. Executing random Colombian fisherman, OTOH, is perfectly fine.

[jauntywundrkind]

The connection is very clear. Amazing Krugman piece. There's still a little bit of a why question to me? What will Citrone or anyone else ever be able to provide back, since they all know this is going to fail, & are using this loan to jack up prices & exit their positions?

Maybe there's some more elaborate way this will enrich certain American cronies. Maybe.

But I tend to think the answer comes if we look back 80 years. A lot of bad evil people needed a friendly state to run to after WWII ended. Today, beyond just being friends-of-an-(evil-doing)-feather together with some other exploitative public-services-destroying extremists, part of me thinks, maybe perhaps: Argentina is being set up as a new exit, a new place to flee too, when justice comes a calling.

[treis]

>So while millions of children must die to save a few billion dollars, taxpayers are on the hook for billions more to bail out Bessent’s hedge fund buddies in a predictably futile attempt to save the Elon Musk of the South.

It's a good thing he didn't give into hyperbole...

[refurb]

The claim that it was done to help his hedge fund buddies has no source.

[piva00]

Bessent's friend Rob Citrone is heavily invested in Argentinian bonds, and companies [0].

[0] https://www.bloomberglinea.com/2024/10/18/exclusive-rob-citr...

[vkou]

1. Every dollar that he can spend on whatever he wants without congressional permission is another nail in the legal theory of 'The president is an unaccountable god-king.'

2. What kind of god-king wouldn't reward his friends and allies?

[clipsy]

Perhaps some of his administration consider Argentina a back-up in the event that things go poorly for them in America. I've heard of something like that happening before.

[WhereIsTheTruth]

I'd guess it's because of its natural resources and "cheap" labor which is only getting cheaper, whether this was done intentionally or not, it seems to go hand in hand with CHIPS Act

https://www.csis.org/analysis/south-americas-lithium-triangl...

[bediger4000]

There is no benefit for the US as a country. You're forgetting that Trump's first impeachment showed us he runs foreign policy for his own benefit. Trump is almost certainly getting some of that money as a kickback.

Speculation is that some of Bessent's buddies are financially exposed to an Argentinian default, and that this keeps them safe from losing money on a sovereign default.

[denkmoon]

Trump views Milei as a buddy, it's that simple. The personal angle is more important than you might think. Plenty of insiders have discussed this aspect of Trump's foreign policy, most recently I watched this podcast with John Bolton talking about it https://www.youtube.com/watch?v=T_BB-96D6qg

[nashashmi]

This is the first attempt at aligning the world to a Trump World Order and away from the New world order started by Eisenhower.

[hulitu]

Monroe doctrin.

[watwut]

Billionaire friends of mister Besset need that bailout, cause they invested into Argentina. They need out.

That is it.

[jordanb]

Apparently there are a lot of hedge funds invested in Argentina. Presumably Trump's support will decline once they've covered their positions.

[gdulli]

Make America's Accredited Investors Great Again

[ta9000]

It really is that simple, corruption.

[dysoco]

What follows is just my theory, but I think it's merely a matter of politics and culture.

Trump doesn't want Milei's government to fail, he needs successful examples of neoliberal, anti-woke, populist, anti-inmigration governments and Milei is probably his best bet. He's not helping Argentina, he's helping a political ally's party.

Betting on the Peso doesn't make sense. It's a lot of money but it's <1% USA's budget. Trump was probably thinking the American media would not pay too much attention to it but apparently it slightly backfired and they did.

[loeg]

Why would Trump care about neoliberalism in the slightest? Trump is anti-neoliberal.

[nine_zeros]

They used taxpayer money to help the original investors into Argentina who invested a few years ago. It went to wall street.

[thehappypm]

If America saves Argentina, and Argentina becomes a powerful country again, that is a powerful ally we could have for a century.

[anonymars]

Have you paid any attention to how the US has been treating its actual existing powerful allies this year? Is Argentina a more valuable ally than, say, Canada?