GOP lawmakers press Trump to cut deal with China at G-20

Senate Republicans are pressing President TrumpDonald John TrumpTrump says his advice to impeachment defense team is 'just be honest' Trump expands tariffs on steel and aluminum imports CNN's Axelrod says impeachment didn't come up until 80 minutes into focus group MORE to strike a trade deal with China or to at least make significant progress at the Group of 20 (G-20) summit in Osaka, Japan, where Trump will meet with Chinese President Xi Jinping.

Republican lawmakers are eager for Trump to reach an accommodation with China, or at least hold off on another round of tariffs on $300 billion on Chinese imports that would hit American consumers by raising the prices of agricultural imports, housewares and electronics.

GOP senators at a private meeting this week impressed on Trump’s top economic adviser, Larry KudlowLawrence (Larry) Alan KudlowMORE, the need for a breakthrough.

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“I really hope President Trump and President Xi can put aside the differences and do what’s in the best interests of both countries,” said Sen. Ron JohnsonRonald (Ron) Harold JohnsonGraham vows Biden, Ukraine probe after impeachment trial GOP warns of 'drawn out' executive privilege battle over Bolton testimony  Senate Republicans confident they'll win fight on witnesses MORE (R-Wis.). “In terms of the economy, I think it’s pretty important.” 

“I think we haven’t really begun to see the true impact to our own economy,” he added. “I hope both sides will recognize the economic benefits to doing a deal. I hope both sides will be gracious to the other. Trade should be a win-win situation.”

Johnson said he delivered that message to Kudlow during a meeting with the Senate Republican Conference. 

Trump and Xi are expected to sit down together Saturday.

U.S. and Chinese trade delegations met Friday, with U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerGOP senator warns quick vote on new NAFTA would be 'huge mistake' Pelosi casts doubt on USMCA deal in 2019 Pelosi sounds hopeful on new NAFTA deal despite tensions with White House MORE and Treasury Secretary Steven MnuchinSteven Terner MnuchinCommerce Department withdraws Huawei rule after Pentagon pushback: reports  Hillicon Valley — Presented by Philip Morris International — Bezos phone breach raises fears over Saudi hacking | Amazon seeks to halt Microsoft's work on 'war cloud' | Lawmakers unveil surveillance reform bill On The Money — Presented by Wells Fargo — Mnuchin says officials working on new tax cuts | Watchdog charges former execs over Wells Fargo accounts scandal | Study questions Biden, Sanders tax plan claims MORE and Chinese Vice Premier Liu He in attendance.

The U.S. and China account for almost 40 percent of global gross domestic product — 22 percent and 15 percent, respectively.

Economists warn that the global economy will slow if the trade war drags on. That, in turn, could dampen demand for U.S. products in markets around the world. 

Morgan Stanley warned in a note to clients last month that if the U.S.-China trade talks fail and Trump increases tariffs on more Chinese imports it could push the world economy into a recession.

Senate Republicans are taking those red flags seriously. 

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“What I want to see from the G-20 is China and America back at the table,” said Senate Finance Committee Chairman Chuck GrassleyCharles (Chuck) Ernest GrassleyGraham vows Biden, Ukraine probe after impeachment trial Social security emerges as latest flash point in Biden-Sanders tussle Trump to sign USMCA next Wednesday MORE (R-Iowa). “Their economy is hurting, ours is slowing down. The world trade is slowing down. It might be a little bit negative right now.”

A trade deal “is going to benefit China, it’s going to benefit us — it’s going to benefit the whole world,” he added. 

But Grassley said he is not optimistic about a deal coming out of this weekend’s talks.

“All you can expect is just to get back to the table,” he said.

Democrats, meanwhile, think Trump’s trade war with China can help them increase their share of the vote in rural parts of Senate battleground states next year.

“The tariff stuff — there’s no explanation for this,” Sen. Jon TesterJonathan (Jon) TesterDemocrats feel political momentum swinging to them on impeachment Nadler gets under GOP's skin I'm a conservative against Citizens United MORE (D-Mont.), a former chairman of the Democratic Senatorial Campaign Committee, said when asked what’s giving Democrats more optimism about taking back control of the Senate next year. 

“Why do I say tariffs when there are a lot of other things? Those are areas he won and he’s hurting those people the worst,” Tester said of the impact the trade war is having in rural areas of Senate battlegrounds like Montana, Iowa and North Carolina, where farming is a big part of the local economy.

Kudlow told GOP lawmakers that the most likely outcome of this weekend’s talks with China is a return to where things were in early May, before the breakdown that caused the stock markets to drop, according to senators who attended the meeting. 

“He’d like to get back to where they were in May,” said Sen. Pat RobertsCharles (Pat) Patrick RobertsSenate fails to get deal to speed up fight over impeachment rules Juan Williams: Counting the votes to remove Trump Senate GOP hopes to move new NAFTA deal before impeachment trial MORE (R-Kan.), adding that Kudlow only said the outcome of the weekend talks is “to be determined.”

GOP senators say a lot is riding on averting a full-blown tariff war with the world’s second-largest economy.

“I think it would be pretty important to show some progress. There are a lot of people I know in farm country that want to see evidence that they’re making some significant headway toward a deal,” said Senate Republican Whip John ThuneJohn Randolph ThuneNo. 2 GOP leader eyes Wednesday of next week for possible votes on witnesses Restlessness, light rule-breaking and milk spotted on Senate floor as impeachment trial rolls on Republicans take aim at Nadler for saying GOP senators complicit in 'cover-up' MORE (S.D.).

“It’s good news to me that they think they’re 90 percent of the way there. I hope that’s correct, and I hope they can get the other 10 percent quickly because this prolonged dispute is having some pretty harmful economic consequences in ag country among other places,” he said. 

Republican lawmakers are especially concerned that Trump may slap a 25 percent tariff on another $300 billion in Chinese goods if the talks fall flat.

That would include hundreds of items like gloves, mittens, overcoats, shoes, sneakers, toys, cameras and wristwatches. 

“If in fact things would not go well, there’s always the threat of the president using an additional tariff and then we go down that road again. That would be most unfortunate,” said Roberts, who is concerned about Chinese retaliatory tariffs against U.S. farm exports.

Trump on Wednesday said he might place a lower tariff on the $300 billion in additional Chinese goods if the talks hit an impasse this weekend. 

“Phase two doesn’t have to be 25 percent. It could be 10 percent, which people can absolutely handle,” Trump told Maria BartiromoMaria Sara BartiromoTrump defenders argue president can't be removed for abuse of power Trump lawyer: Abuse of power, obstruction articles 'have not fared well' Cruz: Hearing from witnesses could extend Senate trial to up to 8 weeks MORE of Fox News on Wednesday.

One Republican senator who requested anonymity to discuss the negotiations said those tariffs, known as “list 4,” would hit American consumers more than past rounds because of the products targeted. 

“I hope the list 4 tariffs can be avoided,” the lawmaker said of the outcome of the weekend negotiations.