The limits of the 'Donroe doctrine'

America's attention is turning to its own backyard, but it is discovering that it still can't go it alone.

- Rana Foroohar

To get a sense of how tricky it is for the US to move from a world of laissez-faire neoliberalism to one in which state control of markets is of much more importance, consider the great power competition going on in Argentina right now.

With the peso in freefall following a corruption scandal in President Javier Milei's government (which is ideologically aligned with Mr Donald Trump's administration), the US is trying to orchestrate a US$20 billion (S$26 billion) bailout for the country, which it hopes will remain a key regional ally. On Oct 9, the US Treasury said it had bought Argentine pesos in a bid to boost the currency.

But China which has its own US$18 billion swap line with Argentina is parachuting in and buying up the country's cheap soya beans, using money that previously would have gone to American farmers, in the wake of the US-China trade war.

That's bad news politically for the White House. Agricultural states tend to be run by Republicans, and farmers are a small but vocal political constituency in the US, as in Europe.

Mr Trump's trade wars mean that not only has China the largest global buyer of US farm products massively cut its purchases, but also that the cost of things like fertiliser and equipment is rising. This has led farmers to complain that Mr Trump is supporting their competitors.

The result is that the administration will probably unveil new support for American farmers in the coming days.