Climate models struggle to produce sea surface temperature (SST) gradient trends in the tropical Pacific comparable to those seen recently in nature. Here, we investigate whether models systematically underestimate internally-generated SST trends by underestimating cloud feedbacks on SST gradients. A heat-budget analysis reveals coupling between cloud-radiative effects, circulation, and SST gradients in driving multi-decadal variability in the Eastern Pacific and suggests that biases in cloud feedbacks may be causing models to underestimate internal SST variability. We find that the magnitude of the cloud-SST feedback in the subtropical Southeast Pacific is correlated across models with the magnitude of Eastern Pacific multi-decadal SST variability. Using this relationship and observed feedback estimates, we estimate that internal Eastern Pacific SST variability is under-predicted in most models. Adjusting for model bias increases the likelihood of generating a cooling trend at least as large as observations in preindustrial control simulations by between ~10% and ~58%.