Republicans think Trump is losing trade war

President TrumpDonald John TrumpNFL players stand in tunnel during anthem, extending protests 12 former top intel officials blast Trump's move to revoke Brennan's security clearance NYT: Omarosa believed to have as many as 200 tapes MORE is facing a significant backlash from Senate Republicans over his trade talks with China, which they see as delivering far less than he promised. 

Several GOP senators say Trump has wound up on the losing side of the discussions, and his talk of lifting rules barring U.S. companies from selling to the Chinese telecommunications firm ZTE has prompted a revolt.

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The Senate Banking Committee on Tuesday voted overwhelmingly in favor of an amendment to block Trump from easing penalties on ZTE, which violated U.S. sanctions by selling equipment to North Korea and Iran. The panel’s action followed a similar vote by a House panel last week.

Treasury Secretary Steven MnuchinSteven Terner MnuchinWhite House says Turkey must release American pastor to cool tensions On The Money: US-China trade talks to resume | Mnuchin warns of more Turkey sanctions | How Turkey's financial crisis could roil the US | Senate GOP seeks tax law fixes Senate GOP urges non-legislative fixes for tax law MORE announced on “Fox News Sunday” that “we’re putting the trade war on hold” by pulling back on the threat of tariffs. But that announcement did not appease unhappy Republicans upset over the administration’s mixed messages.

Sen. Marco RubioMarco Antonio RubioGOP looks to injure Nelson over Russia comments Rubio’s pro-family, conservative family leave policy promotes stability Dems make history in Tuesday's primaries MORE (R-Fla.) blasted Trump’s trade strategy on Tuesday as ineffective.

“Sadly #China is out-negotiating the administration & winning the trade talks right now,” he wrote on Twitter. “They have avoided tariffs & got a #ZTE deal without giving up anything meaningful in return by using N. Korea talks & agriculture issues as leverage.”

Lawmakers from farm states have been the most vocal in pressing Trump to reconsider his tactics.

Sen. Ben SasseBenjamin (Ben) Eric SassePollster: Attitudes toward Trump's farm aid are 'highly wrapped up' in feelings toward president Poll: Majority of Americans support Trump's plan to offer aid to farmers hit by tariffs Hillicon Valley: 'QAnon' conspiracy theory jumps to primetime | Senate Intel broadens look into social media manipulation | Senate rejects push for more election security funds | Reddit reveals hack MORE (R-Neb.) said farmers and ranchers he met with on Tuesday are not reassured by Trump’s claim over the weekend via Twitter that “China has agreed to buy massive amounts of additional farm/agricultural products.”

“I’ve been meeting with farmers and ranchers all morning. I have not yet heard one who thinks the U.S. has won anything from the Chinese leadership,” he said. “They’re scared to death.”

Sasse, who ripped Trump’s trade policies earlier this year as the “dumbest possible way” to take on China, said Trump doesn’t appear to have made significant progress addressing two major economic threats facing the United States: China’s ambitions to dominate high-tech industries and its rampant theft of U.S. intellectual property.

“All that I have seen would suggest that China’s winning,” he said. “The big two are the Made in China 2025 initiative and the way they steal our [intellectual property].”

Even Trump’s most loyal allies are expressing frustration.

Senate Finance Committee Chairman Orrin HatchOrrin Grant HatchDem lawmaker calls Trump racist in response to 'dog' comment PETA calls out Trump for attacking Omarosa as a 'dog' Hatch 'not comfortable' with Trump calling Omarosa a 'dog' MORE (R-Utah) said he agreed with Rubio’s critique.

The criticism has put Trump on the defensive.

On Tuesday, he denied that his administration is on the cusp of a deal with China and vowed that ZTE will have to pay a massive fine.

“What I envision is a very large fine of more than a billion dollars. Could be [$1.3 billion]. I envision a new management, a new board, and very, very strict security rules,” he said during a joint press conference with South Korean President Moon Jae-in. 

“And I also envision that they will have to buy a big percentage of their parts and equipment from American companies,” Trump added.

Other GOP senators are faulting the administration for a disorganized approach.

They say Trump was wrong to threaten sanctions, causing turmoil in markets, only to pull back and declare the trade war over, before reversing course again with new threats.

“Is there a plan somewhere?” asked Sen. Pat RobertsCharles (Pat) Patrick RobertsThe farm bill gives Congress a chance to act on the Pet and Women Safety (PAWS) Act Kobach secures GOP nomination in hotly contested Kansas governor's race GOP senators surprised to attend Trump’s tariffs announcement MORE (R-Kan.), the chairman of the Senate Agriculture Committee.

Some argue it would be more effective to fight what they see as China’s unfair trade practices through the World Trade Organization (WTO) instead of threatening seismic trade penalties only to shrink away from them when faced with retaliation.

“What I’m concerned is there seems to be a lot of ad hoc-ery going on,” said Sen. Jeff FlakeJeffrey (Jeff) Lane FlakeVoters will punish Congress for ignoring duty on war and peace GOP Senate candidate truncates Trump tweet in campaign mailer GOP senator reviving effort to rein in Trump on tariffs MORE (R-Ariz.). “Steel tariffs — you impose them and then go to [foreign trading partners] and say ‘if you want an exemption, this is what you need to do.’ ”

“Then you end up with that ZTE debacle where you promise them some kind of relief from sanctions. We have a structure to this already. It’s called the WTO,” he added.

The ZTE fight has emerged as a flashpoint, and lawmakers grilled Mnuchin about the matter Tuesday when he testified before an appropriations subcommittee.

Sen. Christopher CoonsChristopher (Chris) Andrew CoonsGraham: Flynn should lose security clearance On The Money: Senators propose 'crushing' Russia sanctions | Trump calls for food stamp work requirements in farm bill | China tells US to 'chill' on trade | Apple hits trillion in value Let’s honor public service MORE (D-Del.) asked why the administration is “backpedaling to make it easier” for ZTE to “operate and compete with U.S. companies.”

Sen. Jerry MoranGerald (Jerry) MoranTougher Russia sanctions face skepticism from Senate Republicans Farm groups fear Trump aid won’t fix trade damage GOP senator: Trump said he never heard of anyone who didn’t want a payment from the government MORE (R-Kan.) asked Mnuchin to “justify” administration actions related to ZTE.

Reports of divisions within Trump’s economic team have widely circulated, including a story about Mnuchin and trade adviser Peter Navarro getting into a profane shouting match on the margins of talks in China.

After Mnuchin said the trade war was on hold, White House chief economic adviser Larry Kudlow and U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerMcConnell urges GOP senators to call Trump about tariffs Companies brace for trade war MORE undercut him by claiming that tariffs are still possible.

“You cannot remove tariffs as a negotiating tool or an enforcement tool from this process,” Kudlow told CNBC’s “Squawk on the Street.” “I don’t think tariffs are over. Far from it.”

Some Republicans think that Mnuchin may be playing the role of “good cop” to Lighthizer’s “bad cop” to maximize leverage in the negotiation. But a senior GOP aide admitted this interpretation was “reading the tea leaves.”

GOP senators were unwilling to bring up their concerns on trade during a meeting last week with Trump, but frustrations are boiling over as they fear U.S. exporters are being hurt by the unpredictability of the administration’s approach. 

“I don’t think anything’s been settled yet. It’s still in the development stage. I think we have maybe too many cooks in the kitchen,” Roberts said.

“When people talk about things, they don’t realize how market sensitive it is,” he added, noting that farm commodity prices took a hit earlier this year after China threatened retaliatory measures. 

Harper Neidig and Niv Elis contributed.