NEGOTIATE OR NO MONEY, TRUMP TELLS PALESTINIANS.

DAVOS, SWITZERLAND • U.S. President Donald Trump threatened Thursday to write off the Palestinian leadership and withdraw further U.S. aid if Palestinians are not serious about negotiating peace with Israel, deepening a diplomatic rift and putting Trump’s hopes for a historic agreement on hold.

Trump cast doubt on whether talks could happen now, and blamed Palestinian intransigence rather than his decision to shift decades of U.S. policy on the status of Jerusalem. “That money is on the table, and that money is not going to them unless they sit down and negotiate peace,” Trump said of the hundreds of millions in U.S. aid for the Palestinians.

“Because I can tell you that Israel does want to make peace. And they’re going to have to want to make peace too, or we’re going to have nothing to do with it any longer.”

A State Department official confirmed that all U.S. aid to the Palestinians is under review, though nothing has been decided other than a previously announced US$100 million cut to the United Nations agency that focuses on Palestinian needs. The UN Relief Works Agency for Palestine Refugees made up about half of the US$700 million the United States donated last year, most of it for economic programs.

Sitting with Israeli Prime Minister Benjamin Netanyahu on the sidelines at the global economic forum here, Trump said that his decision last month to recognize Jerusalem as Israel’s capital had removed a major obstacle to a deal. Trump also described an accelerated timetable for moving “a small version” of the U.S. Embassy from Tel Aviv to Jerusalem.

The Jerusalem move upended decades of U.S. policy that set the status of Jerusalem as undecided and a matter for mutual agreement by Israel and the Palestinians. Trump’s willingness to withdraw funding for the Palestinians is also a departure from long-standing U.S. policy that sent millions to the Palestinian Authority and other agencies for schools, economic development projects and other support to Palestinians in the West Bank and elsewhere.

Trump said past efforts were too timid in using U.S. contributions as leverage. He also suggested past U.S. negotiators were also too hidebound in their view of Jerusalem.

“This was never brought up by other negotiators, but it’s brought up by me. So I will say that the hardest subject they had to talk about was Jerusalem. We took Jerusalem off the table, so we don’t have to talk about it anymore.”

Netanyahu responded, “This is a historic decision that will be forever etched in the hearts of our people for generations to come. People say that this pushes peace backward. I say it pushes peace forward because it recognizes history, it recognizes the present reality, and peace can only be built on the basis of truth.”