Along the northern banks of Argentina’s Riachuelo River, luxury car dealerships are buzzing with activity. Sales have soared ever since libertarian President Javier Milei lifted import restrictions, a move applauded by many.
In the vibrant Puerto Madero financial district, bankers laud Mr. Milei’s decision to end the lengthy ban on online dollar sales. Upscale restaurants, meanwhile, cater to Argentine oil executives who express enthusiasm for his initiatives to attract foreign investment.
Yet, across the polluted Riachuelo waterway, 34-year-old Veronica Leguizamon faces a starkly different reality. Her pantry is nearly bare, holding just a few eggs, a carton of milk, and a handful of bread rolls.
Just last Friday, she braved a downpour, clutching a Tupperware container, to bring dinner home for her four daughters from a soup kitchen in her Isla Maciel neighborhood. This has become her daily routine since President Milei drastically cut public service subsidies and removed price controls on essential foods. “Before, we had choices about what to cook,” she lamented. “Now, we rely entirely on others just to know if we’ll have a meal.”
The stark contrast between these Buenos Aires neighborhoods, separated by merely a kilometer, vividly illustrates the deep divisions polarizing the Argentine electorate ahead of Sunday’s nationwide congressional midterm elections (October 26, 2025).
As citizens head to the polls, their profoundly differing views on the economy will decide President Milei’s political fate, and whether the U.S. Administration continues its crucial financial rescue plan for its ideologically aligned, cash-strapped ally.
“In my immediate circle, everyone is pleased with the current situation,” remarked Fernanda Díaz, 42, who operates a yacht rental business in Puerto Madero. “But as soon as I venture out, I see people genuinely struggling to make ends meet each month.”
Market Jitters Over Milei’s Political Challenges
Ahead of the midterm elections, former U.S. President Donald Trump issued a warning, suggesting he would withdraw a substantial $20 billion aid package to Argentina if President Milei were to be defeated by a “socialist or communist” government. This statement immediately triggered a sell-off in Argentine markets.
Trump’s remarks seemed to target Peronism, Argentina’s influential populist movement, which many blame for the economic disarray President Milei inherited when he took office in late 2023.
A history of irresponsible public spending by various Peronist administrations, including that of former President Cristina Fernández de Kirchner (currently under house arrest for corruption), famously plunged Argentina into cycles of hyperinflation and sovereign debt defaults.
“We desperately needed a significant change,” stated Ms. Díaz, who, prior to starting her yacht business, had lost her executive position when Chilean retail giant Falabella exited Argentina. This departure was attributed to rampant inflation, strict import controls, and an unstable exchange rate under the preceding Peronist government. “I initially voted for Milei’s government with great enthusiasm.”
The mere prospect of Peronism regaining power sends shivers through financial markets.
Indeed, when the Peronist coalition secured a decisive victory over President Milei’s Libertarian Party in last month’s Buenos Aires provincial elections, investors reacted with panic. Fearing a loss of support for the President’s free-market reforms, capital quickly flowed out of the country.
In an exceptionally unusual intervention, the U.S. Treasury stepped in, selling dollars to satisfy the immense demand for the currency. They also extended a $20 billion credit line and pledged an additional $20 billion in aid from private banks, thereby avoiding direct funding from U.S. taxpayers.
Following each announcement from the U.S. Administration, asset values surged. Having narrowly averted a currency crisis, President Milei and his supporters experienced a fleeting moment of triumph.
“I am proud of the U.S. support; it empowers us,” declared Luciano Naredo, 28, a luxury car salesman in Puerto Madero. “I believe Argentina is at last claiming its deserved position on the global stage.”
Growing Discontent with Austerity Measures
While Isla Maciel has historically been a Peronist stronghold, a significant 42% of the broader Avellaneda municipality voted for Mr. Milei for president in 2023. They had placed their hopes on the unconventional political outsider to stabilize the economy and curb triple-digit inflation.
Symbolizing his drastic approach with a diesel-powered chainsaw at rallies, President Milei proceeded to eliminate tens of thousands of government positions, drastically reduce state expenditure, and deplete foreign exchange reserves in an effort to stabilize the constantly depreciating peso.
Inflation did decrease, a direct fulfillment of Milei’s key campaign promise.
However, nearly two years into his economic overhaul, purchasing power has also fallen significantly. With annual inflation still exceeding 30%, residents of Isla Maciel have witnessed their wages, pensions, and welfare payments rapidly lose value.
“You simply cannot survive on 290,000 pesos a month with current inflation,” stated Epifanía Contreras, 64, as she filled her plastic bowl with rice and peas at the Foundation of Isla Maciel soup kitchen, referring to her $200 monthly pension. “The situation is steadily deteriorating, and it’s deeply unfair.”
Volunteers at the soup kitchen, serving traditional sopa paraguaya (a custardy cornbread) to a steady line of patrons last Friday (October 24, 2025), reported that demand has more than doubled in the past year. Many who previously sought occasional meals to save money are now arriving genuinely hungry.
“People are showing up out of absolute necessity,” remarked Maria Gomez, a volunteer cook. “It’s complete chaos.”
In last month’s provincial election, support for Mr. Milei’s Libertarian Party in the Avellaneda municipality dropped by a third compared to 2023. Many residents voiced a longing for the redistributive policies of the opposition Peronist party, even with its recent history of economic mismanagement.
Despite this, Milei has reiterated his commitment to his stringent austerity program in campaign speeches. However, his iconic chainsaw prop, once a fixture at his rallies, has been conspicuously absent for months.
Argentinians Grapple with Lingering Uncertainty
Most polls suggest a very close contest between President Milei’s La Libertad Avanza (Liberty Advances) party and the Peronist coalition. Sunday’s elections (October 26) will see half of Argentina’s lower house (127 seats) and one-third of the Senate (24 seats) contested.
With less than 15% control of Congress, the government’s last successful legislative effort was in March. La Libertad Avanza aims to secure enough seats to safeguard its austerity policies, sustain presidential vetoes, and enact crucial labor and tax reforms.
The implications are significant. A defeat for President Milei could intensify pressure on the peso, potentially leading to a painful devaluation of the controlled exchange rate, which would fuel inflation and jeopardize his primary economic accomplishment.
Once again, weary Argentinians are preparing for the potential fallout.
“Every new government arrives, criticizes its predecessor, pledges fundamental changes, and ultimately delivers the same or worse outcomes,” observed Matías Paredes, 50, a real estate broker whose international client base evaporated due to Mr. Milei’s strong exchange rate policies. “This country perpetually operates in cycles.”