- During the U.S. government shutdown in October 2025, rumors abounded that President Donald Trump sent a $20 billion to $40 billion “bailout” for Argentina using taxpayers’ money.
- U.S. Treasury Secretary Scott Bessent said on Oct. 9 the Trump administration agreed to a $20 billion aid package to help Argentina’s economy in the form of a currency swap. The package is not a gift, but a loan. The money will come from an emergency fund the Treasury can use without congressional approval.
- The conditions the Trump administration imposed on Argentina to receive this aid package were not clear.
- After announcing the $20 billion package, Bessent said the Trump administration aimed to double the aid to $40 billion. That extra $20 billion would come from “the private sector,” not U.S. taxpayers. As of this writing, banks and other private lenders were reportedly struggling to find collateral to back this addition to the package, according to The Wall Street Journal.
- On Oct. 14, Trump said in a meeting with Argentina President Javier Milei that if his party loses Argentina’s midterm legislative election on Oct. 26, the Trump administration would not help the country. We contacted the White House to inquire about this statement.
During the U.S. federal government shutdown in October 2025, rumors spread that President Donald Trump sent a multibillion-dollar “bailout” to help stabilize Argentina’s economy using taxpayers’ money.
For example, House Democratic Leader Hakeem Jeffries commented on the alleged bailout in a statement to the press on Oct. 15 (archived):
It’s perplexing to us that Republicans refuse to spend a dime to protect the healthcare of the American people, but somehow the Trump administration found $40 billion to bail out a right-wing wannabe dictator in Argentina in ways that are also going to continue to hurt our soybean farmers in Iowa and in the Midwest. That’s outrageous. This is corruption in real time.
Critics lambasted the purported deal, with some saying the money would have been better spent paying air traffic controllers or government-covered health care costs during the shutdown.
An anti-corruption nonprofit RepresentUs claimed on X the move benefited wealthy U.S. investors who supposedly bet on Argentina’s economic success such as Robert Citrone, of Discovery Capital Management, an alleged close acquaintance to U.S. Treasury Secretary Scott Bessent (archived). (Snopes unpacks the origin and facts of that specific assertion, below.)
It is true that the U.S. government said it agreed to help stabilize Argentina’s economy with billion-dollar funding packages. First, it said it agreed to sending $20 billion and then it said it aimed to double that number.
The Trump administration said on Oct. 9 that it had pledged the money, according to an X post by Bessent. The government inked the agreement on Oct. 20, according to another post by Bessent and a statement by Argentina’s central bank. The administration said the move was strategic, tying it to an effort to maintain influence over Argentina — the Americas’ southernmost country — against China.
Some critics of the Trump administration framed the bailout as a gift using taxpayer dollars, and financial experts described the deal as unusually risky for the U.S. considering Argentina’s history of defaulting on loans, per a Wall Street Journal report.
In reality, the deal was a loan in the form of a currency swap. The money would come from the Exchange Stabilization Fund (ESF), an account the Treasury Department can use for emergencies without congressional approval.
Further, the administration said half the money would come from private lenders, not the U.S. government.
After agreeing to send the initial $20 billion, Bessent said the Trump administration pledged an additional $20 billion from the “private sector,” such as banks and investors, as reputable news outlets such as The Wall Street Journal, NBC News and the The Associated Press have reported.
Whether Argentina actually receives the money was uncertain, as of this writing. After the Trump administration announced the aid package, Trump said his government would only help the country if the party of Argentina President Javier Milei, a Trump ally, won the country’s midterm legislative election on Oct. 26.
Also, it was unclear whether banks would supply their half.
Snopes contacted Argentina’s central bank, the U.S. Treasury Department and the White House about details in this report, and we will update our reporting if we receive responses.
Backstory: Argentina’s economic situation
Argentina defaulted on its debt nine times in its history, most recently in 2001, 2014 and 2020.
In December 2023, Argentina elected Milei, who outlined during his presidential campaign a libertarian program to supposedly fix the country’s longstanding economic woes. Milei promised to shrink the government, cut spending and get inflation under control.
Milei took office and slashed spending on infrastructure, civil servant wages and welfare, among other things. Initially, his reforms fueled optimism, which led foreign investors — including Citrone — to bet on the country’s economic recovery.
Milei’s policies brought the country’s inflation rate from 211% in 2023 to 117.8% in 2024, according to Banco Bilbao Vizcaya Argentaria (BBVA), a Spanish bank. After the economy contracted in 2023 and 2024, it grew in 2025. As of this writing, growth projections for 2025 ranged from 4% (BBVA) to 4.6% (World Bank).
But economic uncertainty returned when Milei lost popularity among voters after his austerity measures resulted in a historically high poverty rate and a corruption scandal engulfed his sister, Karina Milei. As a result, his party, La Libertad Avanza, lost ground in Buenos Aires’ provincial election on Sept. 7, 2025.
Voters will next decide on the fate of Milei’s party during the country’s midterm legislative election on Oct. 26. The election results will determine Milei’s ability to follow his plans for budget reform.
What happened in fall 2025
The outcome of the Sept. 7, 2025, election triggered a panic in financial markets. Investors began selling Argentine assets, including the peso.
The value of the peso dropped so sharply, the situation forced Argentina’s government to sell nearly $700 million to prevent the currency from falling further. (Buying the peso with dollars helps increase its value.) That defensive move by Argentina’s government depleted foreign-exchange reserves.
In September 2025, the U.S. government stepped in to assist the Argentine government in its attempt to support the currency (archived):
Bessent said in another post (archived) that the U.S. could help stabilize Argentina with tools such as “swap lines” and “direct currency purchases.” Bessent said that “opportunities for private investments remain expansive.”
After Bessent’s announcement, Argentine stocks soared. Weeks later, officials from the two countries met at the White House and agreed to a currency swap.
In such a deal, one country uses its currency to buy the currency of another (the one that needs help). In this case, the U.S. agreed to buy pesos with dollars. The country that receives the help must buy back its currency before an agreed date. Currency swaps are loans, not gifts.
On Oct. 9, Bessent announced the agreement on X, saying the Treasury had already bought pesos (archived):
In that post, he said the U.S. purchased pesos directly, and that the two countries agreed to a $20 billion currency swap with Argentina’s central bank.
On Oct. 17, Bessent said the U.S. bought more pesos the day before, without giving a specific total. (archived):
On Oct. 20, Argentina’s central bank announced it had signed the deal with the U.S. The central bank’s statement read:
The agreement sets forth the terms and conditions for the implementation of bilateral currency swap operations between the two parties. Such operations will allow the BCRA [Banco Central de la República Argentina] to expand its set of monetary and exchange rate policy instruments, including the liquidity of its international reserves, in accordance with the regulatory functions established in its Charter.
A day later, Bessent posted on X that this deal with Argentina was “a bridge to a better economic future for Argentina, not a bailout” (archived).
Much was unknown about the deal, as of this writing. Neither party has shared specific terms to which they have supposedly agreed. They have not said when Argentina would have to buy back its pesos, nor have they reported the amount the U.S. has already purchased. We asked for those details in our inquiries to the Treasury Department, White House and Argentina’s central bank.
The pool of US funding, explained
Money for this bailout would come from the U.S.’s ESF, which, as of August 2025, had a bit more than $43 billion available, federal records show.
The U.S. government used the ESF once before to support a foreign government in trouble. That happened in 1995, when then-President Bill Clinton failed to obtain congressional approval to bail out Mexico during its peso crisis.
But unlike the 2025 situation with Argentina, the U.S. did not rescue Mexico, a close trading partner, on its own. Clinton worked with the International Monetary Fund (IMF), an organization of 191 countries dedicated to helping nations regain economic stability when they can’t finance themselves through usual means. The IMF imposed strict conditions on Clinton’s aid package to Mexico.
In the case with Argentina, the Trump administration agreed to the aid package without IMF backing and did not publicly outline conditions for repayment, as of this writing.
Bessent said in the Oct. 9 X post Argentine Economy Minister Luis Caputo promised the government would maintain strict budgetary policies, following the IMF’s conditions for repaying that organization money.
The IMF has been supporting Argentina for years.
The organization announced in April 2025 its 23rd scheme to support the country’s finances. As of this writing, the country owes the IMF $57 billion (41.8 billion in special drawing rights (SDR), the IMF’s monetary unit), the highest amount any country has owed the lender.
The IMF expects the countries it supports to implement policies to rebalance their budgets, often leading to austerity measures.
Argentina should cut off Chinese helpline, US says
Argentina has made similar agreements with other governments before. In 2020, Argentina arranged an $18 billion currency swap with China, $5 billion of which Argentina activated in 2024 and renewed in 2025. (That happened despite the fact Milei called China an “assassin” state during his 2023 presidential campaign.)
After Trump imposed tariffs on Chinese products in 2025, China — the world’s biggest importer of soybeans that, under usual conditions, buys them from the U.S. — started relying more on Argentina for the product. This angered U.S. farmers.
The Trump administration saw this rapprochement between Argentina and China as a threat. Asked if he was trying to “drive a wedge” between the two countries, Trump defended the U.S.’s support of Argentina as a strategy to maintain influence in the Latin American country.
During the Oct. 14 meeting between Trump and Milei, Trump said, as part of the 2025 deal, Argentina should end its currency swap agreement with China.
WSJ sources: US is taking a risk
Economic experts reportedly expressed worry over the U.S.’s risk in offering the line of credit to Argentina, especially since some believe the country should let its currency depreciate rather than let it fluctuate within a tight band against the dollar.
For example, The Wall Street Journal quoted Brad Setser, a former Treasury official under former President Barack Obama, as saying, “Should the peso depreciate, which many think is not only likely but necessary, the Treasury would be left holding assets that have fallen in value,” after the currency swap with Argentina. In other words, Setser said the U.S. may not recover the entirety of the loan.
In the same article, The Wall Street Journal reported concerns among IMF officials that the U.S. would demand repayment of the bailout before Argentina repays the IMF the $57 billion it owes.
We asked for responses to these concerns in our inquiries to the White House, Treasury Department and Argentina’s central bank.
Also, whether private lenders will pull through on their portion of the Trump administration’s declaration to help Argentina remained unknown.
On Oct. 20, The Wall Street Journal reported that banks including JPMorgan Chase, Bank of America, Goldman Sachs and Citigroup were having difficulty finding collateral or obtaining guarantees from the U.S. government for the loan to Argentina, and that that portion of the deal may not happen as a result.
Snopes contacted those four banks to independently verify The Wall Street Journal’s reporting. Citigroup and Goldman Sachs declined to comment, and the others did not respond.
Claims the currency swap would benefit US investors
Claims about wealthy investors supporting the U.S.-Argentina currency swap for their own financial gain stemmed from reports about Bessent’s alleged ties to banks.
Citrone, of Discovery Capital Management, was in touch with Bessent before he announced the deal, The New York Times reported, citing two anonymous sources. (Due to the anonymity of those sources, Snopes was unable to track them down for independent verification.) Meanwhile, Bloomberg News reported that Citrone increased his investment in Argentine bonds in early September 2025, before the aid package announcement.
The New York Times named investment funds the bailout package would supposedly benefit, including PIMCO, Fidelity and BlackRock, and claimed the deal would favor investor Stanley Druckenmiller’s interests. He, Bessent and Citrone reportedly worked together for billionaire George Soros’ investment fund, though there was no verified evidence to definitively confirm that history.
Snopes reached out to these investors for confirmation. Citrone’s Discovery Capital declined to comment.
In an interview with CNBC, Bessent dismissed the claim that the government agreed to the bailout package to help wealthy U.S. investors.
Deal may hinge on upcoming election
The Oct. 26 midterm legislative elections in Argentina could affect the deal between the country and U.S.
In the Oct. 14 meeting with Milei, Trump indiciated the U.S. would not go through with the deal if Milei’s party loses on Oct. 26. “If he [Milei] does win, we’re going to be very helpful,” Trump said. “And if he doesn’t win, we’re not going to waste our time because you have somebody whose philosophy has no chance of making Argentina great again.”
We asked the White House if Trump intends to make good on this threat.
