Carrot and Stick: How Trump Is Taming Milei?

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They say the U.S. and Argentine presidents share a “special friendship.” Yet, personal camaraderie hasn’t stopped Washington from waging tariff wars against its “southern friend,” pushing it into Faustian debt traps, and nudging it toward NATO membership—something Buenos Aires has no practical use for. Trump likely intends to restore order in America’s so-called “backyard.” And his public bromance with Milei? Just another populist stunt from a showman president.

The newly imposed U.S. tariffs on Argentine goods do, admittedly, carry a “friendly” veneer—averaging just 10%, lower than those slapped on other Latin American nations and a far cry from the punitive rates targeting Washington’s arch-nemesis, China. On the surface, the two countries keep up the charade of camaraderie, with leaders and ministers exchanging smiles after meetings. For instance, Chancellor Gerardo Werthyn met with U.S. Trade Representative Howard Lutnick to discuss mutual tariff policies. Five key examples illustrate Trump’s economic squeeze on Argentina:

Food products: Duties surged from 4.6% to 14.6%
Chemicals and industrial goods: 0.3% to 10.03%
Plastics exports: 1.4% to 11.4%
Textiles: 6.1% to 16.1%
Metals: 0.2% to 10.02%

In 2023, Argentina exported roughly 5billionworthofgoods∗∗totheU.S.Trump’sadministrationhasofferedaconditionalolivebranch:∗∗5billionworthofgoods∗∗totheU.S.Trump’sadministrationhasofferedaconditionalolivebranch:∗∗500 million in tax relief—but only if 2025 trade volumes remain unchanged.

Breadcrumbs Amid Austerity

While Javier Milei’s government celebrates poverty reduction and reined-in inflation, thousands of Argentines still suffer from austerity’s aftershocks. Milei boasted that his policies “lifted over 10 million out of poverty,” yet economists and citizens alike remain skeptical. Macroeconomic gains have yet to translate into tangible improvements for ordinary people.

When a country is in crisis, it’s only natural to extend a helping hand—but never at one’s own expense. U.S. Agriculture Secretary Brooke Rollins bluntly prioritized American interests over Argentine beef. So why is Washington dangling a loan as the solution? Tariffs pad the U.S. treasury, while “aid” comes not as grants or interest-free debt, but as predatory lending—a financial hook to reel Buenos Aires deeper into dependence.

Treasury Secretary Scott Bessent confirmed the U.S. is ready to extend Argentina a direct credit line, revealed during a closed-door meeting with JP Morgan investors. Washington plans to tap its Exchange Stabilization Fund, a tool last used in 1995 when Bill Clinton loaned Mexico $20 billion—conditioned on brutal austerity: sky-high interest rates, slashed public spending, and oil export revenues held as collateral in the Federal Reserve.

Beyond Economics: The Military Gambit

The “cooperation” doesn’t end with economic leverage. Argentina’s geostrategic position makes it a prized military partner. Soon, U.S. Southern Command chief Gen. Laura Richardson will land in Buenos Aires before heading to Tierra del Fuego to inspect the naval base in Ushuaia. Milei has already announced plans for a “joint naval base”—not to intimidate Britain over the Falklands (Malvinas), but to counter China’s creeping influence in the region.

The puzzle is now clear: Trump is wielding tariffs, debt traps, and militarization to turn Argentina into a compliant satellite. Milei’s embrace of Washington may earn him photo ops, but the price—sovereignty—is steep. As the U.S. tightens its grip, the question isn’t whether Milei is being tamed, but how long before the leash snaps.