U.S. set to cut Palestinian funds

Sources say White House wants changes in U.N. agency

WASHINGTON — President Donald Trump’s administration is preparing to withhold tens of millions of dollars from the U.N. agency for Palestinian refugees, cutting the year’s first contribution by more than half or perhaps entirely, and making additional donations contingent on major changes to the organization, according to U.S. officials.

Trump hasn’t made a final decision, but he appears more likely to send only $60 million of the planned $125 million first installment to the U.N. Relief and Works Agency, said the officials, who weren’t authorized to publicly discuss the matter and spoke on condition of anonymity.

Future contributions would require the agency, facing heavy Israeli criticism, to demonstrate significant changes in operations, they said, adding that one suggestion under consideration would require the Palestinians to first re-enter peace talks with Israel.

The State Department said Sunday that “the decision is under review. There are still deliberations taking place.” The White House did not immediately respond to questions about the matter.

The administration could announce its decision as early as Tuesday, the officials said. The plan to withhold some of the money is backed by Secretary of State Rex Tillerson and Defense Secretary James Mattis, who offered it as a compromise to demands for more drastic measures by U.N. Ambassador Nikki Haley, the officials said.

Haley wants a complete cutoff in U.S. money until the Palestinians resume peace talks with Israel that have been frozen for years. But Tillerson, Mattis and others say ending all assistance would exacerbate instability in the Middle East, notably in Jordan, a host to hundreds of thousands of Palestinian refugees and a crucial U.S. strategic partner.

The U.S. is the agency’s largest donor, supplying nearly 30 percent of its total budget. The agency focuses on providing health care, education and social services to Palestinians in the West Bank, Gaza Strip, Jordan, Syria and Lebanon.

Hundreds of thousands of Palestinians either fled or were forced from their homes during the war that led to Israel’s establishment in 1948. Today, there are an estimated 5 million refugees and their descendants, mostly scattered across the region.

Eliminating or sharply reducing the U.S. contribution could hamstring the agency and severely curtail its work, putting great pressure on Jordan and Lebanon as well as the Palestinian Authority. Gaza would be particularly hard hit. Some officials, including Israelis, warn that it might push people closer to the militant Hamas movement, which controls Gaza.

The U.S. officials said any reduction in American assistance could be accompanied by calls for European nations and others to help make up the shortfall.

The U.S. donated $355 million in 2016 and was set to make a similar contribution this year; the first installment was to have been sent this month.

But after a highly critical Jan. 2 tweet from Trump on aid to the Palestinians, the State Department opted to wait for a formal policy decision before sending any of the $125 million.

Trump’s tweet expressed frustration over the lack of progress in his attempts to broker peace between Israel and the Palestinians, and he pointed the finger at the Palestinians, using all capital letters for the amount of money involved. “We pay the Palestinians hundreds of millions of dollars a year and get no appreciation or respect,” he said. “But with the Palestinians no longer willing to talk peace, why should we make any of these massive future payments to them?”

In a two-hour speech Sunday, Palestinian President Mahmoud Abbas railed against Trump for his treatment of the Palestinians.

“[Trump] said in a tweet: ‘We won’t give money to the Palestinians because they rejected the negotiations,’” Abbas said. “Shame on you. When did we reject the talks? Where is the negotiation that we rejected?”

Trump infuriated Palestinians and Muslims around the world when he announced late last year that the U.S. would recognize Jerusalem as the capital of Israel and move its embassy there, upending decades of U.S. policy and countering an international consensus that the fate of Jerusalem should be decided in negotiations between the sides.

Abbas has said that by siding with the Israelis on a sensitive issue, the announcement had destroyed Trump’s credibility as a Mideast peace broker.

“We can say no to anyone if things are related to our fate and our people, and now we have said no to Trump,” Abbas said. “We told him the deal of the century was the slap of the century. But we will slap back.”