“The dollar always talks in the end,” Donald Trump wrote in his 1987 bestseller The Art of the Deal.
Javier Milei’s surprise triumph in Argentina’s midterm elections – after Trump bailed him out with 40bn of them – suggests there may be some truth to that assertion.
The US president had vowed to jettison his South American ally if, as widely predicted, the radical libertarian fared badly in Sunday’s make-or-break legislative vote. “If he doesn’t win, we’re gone,” Trump declared when Argentina’s shaggy-haired president visited him in Washington earlier this month to plead for economic help.
Milei’s political woes have been building in recent months, with growing public frustration over Argentina’s sluggish economy translating into market jitters and a pasting in Buenos Aires’ provincial election in September. Trump stepped in after that humiliating result, offering a $20bn (£15bn) currency swap deal and a further $20bn in support for an economy he claimed was “dying” – although the US president indicated such “generosity” would evaporate if Milei failed to win big on Sunday.
Milei’s opponents accused Trump of flagrantly meddling in Argentina’s electoral process with his explicit message to voters. Some predicted an anti-Trump backlash, similar to the one felt in neighbouring Brazil as a result of Washington’s ham-fisted attempt to force its authorities to abandon the coup trial of former president Jair Bolsonaro.
But on Sunday night there was scant sign of voter reprisals over Trump’s intervention. If anything, some suspected the gambit might have paid off by swaying voters’ minds.
Diego Guelar, an Argentinian politician and former ambassador to China and the US, voiced unease at how Trump had warned voters “they had to vote for his friend [Milei] or he would abandon them”. But Guelar thought the US president’s “direct intervention”, while “awful”, had worked, with voters accepting “the need for American assistance” and blaming the economic crisis on the opposition.
Brian Winter, an Argentina expert who edits the Americas Quarterly magazine, said: “It has the appearance of a masterstroke by Donald Trump. He threw a lifeline to somebody who was drowning at just the right moment.”
Milei’s libertarian party, La Libertad Avanza (Liberty Advances), captured nearly 41% of the vote – considerably higher than expected after a miserable spell of corruption scandals and growing economic crisis – compared with his Peronist rivals’ 32%. Argentina’s bonds, stocks and currency, the peso, surged on Monday as Milei celebrated what he called a vindication of his two-year-old “shock therapy” crusade.
Winter was still trying to gauge the extent to which Trump’s $40bn rescue package – and pre-election admonition – had affected the result, which underlined how many voters still blamed the Peronists for years of economic chaos, even if they were increasingly disillusioned with Milei.
“But the way politics works, Trump will get credit for this,” Winter predicted. “It looks like a bold bet – and not just a bold bet. The appearance, at least, is that he showed the value of being an ally to Donald Trump. And this is a White House that is making more use of carrots and sticks in Latin America than any White House in probably 50 years.”
Trump’s unexpectedly intense focus on Latin America – which also includes the highly controversial naval buildup off Venezuela’s coast, accusing Mexico’s leaders of narco ties, threatening to forcibly “take back” the Panama canal, and slapping 50% tariffs on Brazil – may not be winning him many friends in the region, beyond Milei’s movement.
But Winter believed it was, for better or worse, influencing people: “He has helped cajole the Mexicans into a more active approach on security and migration. He has convinced the Panamanians to push the Chinese out of the proximity of the canal. He appears to have backtracked on a failing strategy in Brazil – and now both sides are talking about a significant deal on rare earths, critical minerals and potentially other areas.”
Trump’s distinctly 19th century-style doctrine – “rescue packages and loans for his friends and gunboat diplomacy for his enemies” – could easily backfire over time, Winter admitted. “But for now, most of them are producing results.”
Above all for Milei, now Trump’s best regional friend, who used X to thank his North American underwriter as the scale of Sunday’s victory became clear.
“You are a great friend of the Argentine Republic,” Argentina’s president told Trump, before signing off with a rallying cry they now share: “Maga.”
Additional reporting by Facundo Iglesia
