This article highlighted some of the challenges the United States is facing under the Trump administration, particularly in Argentina and China. Argentina's peso is experiencing a fall in inflation, which has slowed economic growth. There is also a very high unemployment rate, and exports have been below average. The president of Argentina, Javier Milei, has promised to cut the budget deficit; however, the public's support for these new policies will not last long. The Trump administration has a plan to let Argentina's currency float more freely, which will then stabilize growth and employment, and exports should resume. This will help the Milei government repay what had been borrowed.
In China, the constant war between Trump and Xi has no clear end in sight for the Trump administration. The promises from Xi to buy more US soybeans have been unfulfilled; however, Trump had held up his promise to scale back tariffs, suspend port fees for Chinese ships, and temporarily delay an expansion of the Entity List that had threatened Xi on rare-earth controls. Xi has the upper hand in this battle; if Trump threatens China with port charges, tariffs, or export controls, China will pull its rare-earth export controls. Rare-earth exports are vital for the US, and currently, China holds the monopoly, which will not last long.
https://www.project-syndicate.org/commentary/argentina-and-china-show-disarray-of-trump-foreign-economic-policy-by-barry-eichengreen-2025-11
3 comments:
It's interesting how the article highlights both Argentina and China, exposing weaknesses in Trump's economic strategy. The situation with Milei makes sense on paper, but it's challenging to envision the peso fixing deep structural issues without significant political pushback. And with China, the rare-earth leverage is a huge problem; the U.S. can't afford to provoke a supply cutoff. It really feels like the administration is trying to manage two different fires at once without a clear long-term strategy.
Argentina’s predicament demonstrates how hard it is to push reforms. What exactly is Americas plan to help Argentina?
I like how your article does a good job describing the U.S. plan to let Argentina’s currency float more freely, connecting this policy to possible improvements in growth, exports, and repayment of debt. How might the U.S. reliance on foreign trade partners like China for rare-earth elements or Argentina for debt repayment affect America’s long-term economic security, and what policies could reduce this?
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